patterns for monetizing the iot
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© 2015 Flexera Software LLC. All rights reserved. | Company Confidential1
Edward McNeilSoftware Monetization ServicesFlexera Software
Patterns for Monetizing the IoT
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential2
New Business Models
Industrial IoT =
Opportunity
Challenge
Data, Data, Data …
Hardware + Software+ Connectivity
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential3
Adoption and Impact of the Industrial IoT*
Operational Efficiency• Asset utilization• Operational cost reduction• Worker productivity
New Products & Services• Pay-per-use• Software-based services• Data monetization
Outcome Economy• Pay-per-outcome• New connected ecosystems• Platform-enabled marketplace
Autonomous, Pull Economy• Continuous demand-sensing• End-to-end automation• Resource optimization
Near-Term Long-Term
*Industrial Internet of Things: Unleashing the Potential of Connected Products and Services, World Economic Forum, 2015
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential4
Key Questions• What do I need to implement new business and revenue models and to
start selling services rather than products?
• How do I monetize my solutions and increase renewal rates?
• How do I move to SaaS and Cloud to fulfil my customer’s needs?
• Do I really know my customer base and provide them with a great experience?
• How do I support scalability & rapid change at low cost?
• What does it take to manage customer entitlements in a multi-level sales organisation?
• How do I get my Sales team to change habits to sell software ?
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential5
Adoption and Impact of the Industrial IoT*
Near-Term Long-Term
Operational Efficiency• Asset utilization• Operational cost reduction• Worker productivity
SKU ReductionIndustrial automation firm reduced # of unique control panels from ~500 to ~5
Use Case:
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential6
New Products & Services• Pay-per-use• Software-based services• Data-monetization
Adoption and Impact of the Industrial IoT*
Near-Term Long-Term
Cloud Based Power Management SoftwareRecurring revenue subscription license model for cloud-based IT systems management control and monitoring.
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential7
Outcome Economy• Pay-per-outcome• New connected ecosystems• Platform-enabled marketplace
Adoption and Impact of the Industrial IoT*
Near-Term Long-Term
Ultimate OutcomeCharge per hours of operation, and provide all ongoing maintenance and support.
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential8
Autonomous, Pull Economy• Continuous demand-sensing• End-to-end automation• Resource optimization & waste reduction
Adoption and Impact of the Industrial IoT*
Near-Term Long-Term
Public Safety …. As-a-Service?Monetize embedded and server software across an entire public safety value chain from radios & cameras to video processing and jail management. Can offer an entire solution as a service – priced per public safety officer per year.
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential9
A unit of Usage to Apply Pricing• Simple, Fair, Scalable, Measurable• CPU, Server, named user, etc• Use Model
Revenue Generation Model• Recurring vs. Up‐front Revenue• Perpetual, Subscription, Utility, etc
Compliance Approach• Philosophy & Vision• User Experience
Technology Considerations• Common License Layer• License Key Methods & Structure
License Entitlement & Fulfillment• Business Systems & Integration• Business Processes
Commercial Structure• Product Taxonomy & Structure
‐ Products, Bundles, Suites….‐ Upgrade, Upsell, Update, etc
• Commercial Units
SWM Success Framework
License Model
Product (Line) Strategy & Structure
Corporate Business Drivers & Principles
Prospect‐to‐SupportSystems & Processes
Customer Needs
Product & Market Climate
License Metrics
Compliance Strategy
Enforcement
RevenueModel &CommercialIntent
Compliance & Enforcement
Policies:• Moves• Transfers• WAN• Mobile Users• Demo• Development• Maintenance• EOL
EntitlementManagement
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential10
How Do I Get Started? Prepare . . .
Define . . .
Execute . . .Go‐To‐Market
Software
© 2015 Flexera Software LLC. All rights reserved. | Company Confidential11
How Do I Get Started?
Act Quickly
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