Chris Weston and Matt Ballantine invited me to be interviewed for their WB-40 podcast on Licensing in the Cloud. You can listen to the full podcast here.
We discussed loads of stuff, but the thing that stood out for me is that the shift to cloud is transformational not just for customers, but also for the software vendors as well.
In the past, software vendors could get away with simple box-shifting (or providing downloads!) of their software, charge support and maintenance and not worry too much about whether or not the software was actually being used. Of course, if the customer loved the product that would drive additional sales, but if the customer was silly enough to buy more software than they actually needed, then the software vendor wasn’t going to complain.
The fact that there is an underlying infrastructure to Cloud Services means that has changed for two reasons:
Firstly, the betting is that cloud services is a winner takes all market, so grabbing market share is absolutely critical for future business prospects, and being able to trumpet their market share in the media is great marketing.
Secondly, the last thing a cloud services provider wants is unused infrastructure that they installed in order to gear up for usage that doesn’t materialise. It destroys the economies of scale that they rely on to allow them to continually drive down prices in their search for market share, so if they won’t want you as a customer unless you can convince them you will actually use their services.
This all has interesting implications for negotiating with cloud service providers, which I’ve explored in this LinkedIn post.