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what are acceptable licensing terms?
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Posted by moritz
May 18, 2009 at 03:56 AM
Owning multiple PCs, I have found myself looking more closely at licensing terms for “single user” scenarios.
I would like to collect your thoughts (maybe to guide some of the software authors lurking on this forum) on what would be “reasonable” for your purposes.
Here are some examples from software that I own or didn’t buy because of licensing terms (all of these scenarios are for SINGLE USER):
category 1—license works on 1 PC, second PC requires additional license
examples: RoboForm
con: can get too expensive if alternative in category 4, 3, 2 (in order of preference) exists
category 2—license works on 2 PCs, some sort of online activation scheme
examples: Microsoft Office, Buzan iMindMap, MindManager post-7.1 some photo editing apps (e.g. Capture One)
con: becomes a burden if activation scheme doesn’t work reliably and tech support needs 4 days to reset activation counter (e.g. iMindMap—reason I didn’t update to 4.0 Ultimate)
con: gets increasingly expensive with number of PCs (I keep old PCs around, currently own 10 PCs)
pro: (kudos to Capture One): Assuming the activation scheme allows me to reset activation for all PCs, I have found that very effective to overcome the activation blues.
category 3—license “says” that you are only allowed to use it on 2 PCs
examples: MindManager pre-7.2
pro: no activation hassle (those schemes tend to break, e.g. if you run the same Windows partition on a Mac both from Bootcamp and Vmware/Parallels)
con: expensive if you are strict about licensing terms. If you just keep it around on some PCs for use once per quarter that’s still technically possible (e.g. if one of your 2 primary machines is getting serviced and is unavailable).
category 4—license “says” you can only run one copy at a time (no technical checks), but unlimited number of PCs (for one “named” user!)
examples: Personal Brain, Zoot, OmniOutliner, OmniGraffle
pro: I feel that I am getting my money’s worth—“per user” license allows me (as an individual) to use the software when and where I need it.
pro: because of the higher value I am getting for my money I am more likely to support the company/author in the future and recommend the product.
pro: I can use the product more often than I would in any of the other categories.
category 5—license states “non-commercial use only”
examples: InfoQube
pro: cheaper prices for hobbyists
con: in this case (commercial price 6x higher than personal use) ignores the fact that in a large corporation I have to buy it out of my own pocket anyway (procurement costs + current state of the economy getting in the way of having the company buy it for me).
con: affects only people with a conscience and/or very strict licensing tracking in the workplace (I could lose my job over licensing violations).
con: dishonest people not affected by licensing terms (but then maybe they are running a pirated copy anyhow)
So to sum it up, I will buy
cat 4 - true “personal” license without reservation
cat 3 - carefully consider if the 2 PC limitation describes 99% of my use (and if need be acquire additional licenses)
cat 1 - similar to 3, but by default almost always 2x more expensive (so multiply MSRP by 2)
cat 2 - be wary but buy if no alternative exists (e.g. Microsoft, Adobe)
cat 5 - impossible for me. If I am spending money on software I want to be able to use it to get ahead in my job, even if my company doesn’t fund it.
What are your thoughts, did I miss any single user licensing/activation categories and do these differences affect your buying decisions as much as they affect me?
Posted by Pierre Paul Landry
May 18, 2009 at 04:24 AM
Hi,
I’m one such developer.
InfoQube being still in beta, licensing is yet to be finalized. However, as stated here:
http://www.sqlnotes.net/drupal5/index.php?q=node/168
“Personal license: $70. $50 Introductory price. Fully working license. Free minor updates. Can be used for personal use. Can be used for work related activities in large corporations, when license purchase is not possible due to restrictive purchasing policies.”
If you must buy it yourself, you definitely fall into that category. Medium to large size organizations can afford a $300 software, if it improves productivity. Individuals probably cannot afford it.
Also of interest:
“Educational / non-profit license: Same price as the Personal license. Can be used by students, teachers and non-profit organizations.
Small Business license: Individually at 50% off the Full license. A 3-license pack for the Full license regular price. “
Pierre
Posted by moritz
May 18, 2009 at 05:47 AM
thanks Pierre, your perspective as a software developer is much appreciated!
Also reassuring for me that your licensing terms are not as prohibitive as I had thought (I recall having seen a mention of a “90 day transition period before you have to pay for full commercial license”?).
If you can clarify that your only restriction is “single user” then you can expect my order shortly!
Interestingly some of the examples above are great tools (MindManager, iMindMap) that either have always been super restrictive (and with a broken copy protection technology!) like iMindManager or recently increased their “protection” through additional activation measures.
Years ago I was about to buy MindGenius rather than MindManager 2002 (current version at that time) and although I liked MindGenius better, the “single PC” licensing killed it for me. Subsequently I have purchased every single MindManager update (5,6,7,8) and I know that 1000s of copies of MindManager have been purchased by companies based on my recommendation, so I am wondering if MindGenius have benefitted in the long run from their more restrictive licensing (which they are entitled to, just trying to point out that in an age where more people have 1 PC at work, 1 at home + likely one notebook or netbook the 3x price increase is likely to become a sales blocker more often than not).
So why did I post this? I feel that we have a voice as a community to give software developers a chance to rethink the way they want to interact with our group of compulsive buyers :-)
Posted by Stephen Zeoli
May 18, 2009 at 01:39 PM
Speaking as someone who has bought A LOT of software over 25 years as a computer owner, I’d like to add my two cents to this:
I want the licensing to be as easy as possible.
I don’t want to have to pay additional fees to use the software on multiple computers… you’re just adding an additional hassle to someone who has already agreed to be your customer. It just feels like the developer is trying to squeeze more money out of me—if you can’t sustain the product on the fee for one computer, raise the price. Buying software that can only be used on one computer is like buying a car that can only be driven on one highway.
I tend to distrust developers who do not trust me to be an honest user, so don’t have complicated processes for how to register the software. This isn’t a James Bond movie.
Developers worry someone might be using their application without paying for it. While that might be true, my guess is that those people who do so, would never have bought if you’d made it more secure. So you haven’t really lost any revenue. But you might lose revenue from honest users like me who decide not to use or buy your software because of the convoluted licensing and registration scheme. (Just to be clear, I’m not aiming this statement at the friendly developers who contribute to this forum.)
In short, keep it simple and trust your customers.
Steve Z.
Posted by dan7000
May 18, 2009 at 05:00 PM
To echo Steve’s sentiment: The single-computer license is the worst. However, it’s also the easiest to enforce. If they provide an easy way to transfer licenses, I can sometimes deal with it. My license to Taskline has followed me through 3 computers now and it’s still going strong.
Some of you know I used to manage software development at Intuit. For a while, I was on a team attempting to design new DRM-based licensing schemes for the company’s software. I always have thought that service-based pricing, tied to free software, is the best scheme. For instance, we designed the scheme in TurboTax wherein you get a free copy of the software, but it costs money to either print or e-file your final return. I thought that was a really elegant, and 100% enforceable, way to charge people for software. Unfortunately, when it came out, users were pissed off and it got lots of bad press. I think that the furor has died down, though, and I believe that TurboTax still uses that model, at least for some set of its distribution.
User-based pricing is also a great model. Unfortunately, it’s hard to implement any enforcement scheme that isn’t prone to error. People get very upset when they buy software and then get locked out of it. This is one reason that web service tie-ins are so great: they let you do user-based software pricing. I.e., EverNote, etc. (They also let you charge per year instead of per release, which some users dislike).