Notes for Chp. 4 of "Beyond Software Architecture"

Chapter 4. Business and License Model Symbiosis

Software vendors normally have one or more license models on each of their products.Why do we need a license? Because software is different from solid objects. You cannot stop people from copying it, redistribute it, and even reverse-engineering it. License is a legal way of protecting people from abusing the product while still enjoying not only the product but also the services around the product.

There are several common software business models. For example, users can by access or use of application for a period of time, or they can be charged at a percentage of their cost saved from using the software (enterprises tend to be resistant to this model), or they can be charged per transaction, or the vendors can be more precise by metering the users accesses on different resources(for example, the amount of concurrent users). Users can also be charged on the hardware that runs on the software instead of the software itself. Another way is used by the open source tool vendors.An open source tool is free. But if you want specialized services on top of the tool, it comes with price.


I have two reflections on the pricing models.

First, modern software tends to provide more features with online access. One example being the anti-virus software which normally needs to updates its virus library regularly. By using the Internet,one can find certain ways of protecting the software from abuse. In fact, in the architecture design process, one must try to include this business model in the technical design.

Second, software vendors must think of their architecture to have specialized support of more precise pricing models, such as the metering. Not all software can be priced by the metering way. But it is preferred by some customers.

There can be different rights and restrictions (most of them are very technical) associated with each type of business models. Again, the tarchitecture is very important in embedding such rights and restrictions in the technical design.

So, how can tarchitecture help the business model? I am sure that may technical architects have quite a lot of ideas in their mind. There are following things that one should always be careful with.

1. The most important thing is to capture the necessary data for the business pricing. This has to happen within the architecture.

2. Give the necessary report so that both the vendors and customers can be aware of the details of the cost.

3. Put something there to enforce the business model in case the license is violated.

4. Sometimes, the price can also be linked with those "-ility" such as scalability and reliability. The architecture should be able to support it.

5. Successful tarchitecture must also try to help customers to save their budget on other things such as the hardware investment.

6. Vendors should regularly adjust the parameters used in the pricing models. Everything changes over the time,especially in the IT world.

There are many ways of enforcing the licensing models. One can always try to link the architecture with online access to ensure that people are serious when using and paying the software. However,up to now, I have not heard any 100 percent secure licensing model if there is no law to protect the copyright of software.

Finishing on the tarchitecture, let us get back to the marchitecture. In fact, in the beginning of specific software market, vendors can make the business models very simple so that customers can easily understand and decide to buy. The idea is of course to occupy the market first.

The maturity of the market decides on the business model, indeed.