monetizing the cloud
DESCRIPTION
Robbie Forkish of Aria Systems discusses current billing and chargeback systems for cloud-based applicationsTRANSCRIPT
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Monetizing the Cloud
Aria Systems
Billing and Subscription Management
Robbie Forkish, Senior VP, Engineering
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Agenda
Aria Systems introductionThe Challenge of Cloud MonetizationReal-world examplesQ&AResources and contact info.
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We are the technology leader in billing and subscription management
Founded in 2003 – The pioneer in SaaS billing
>300% growth in monthly recurring revenues in 2009
Broad Customer Success
Cloud Providers: SaaS, PaaS, IaaS
Telecommunications
Publishing
Social Media
Entertainment
On-Line Retail
Online Gaming (MMO)
Aria Systems: Company Profile
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The Challenge of Cloud Monetization
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The Cloud: Great News for App. Developers
Flexibility• Wide range of platform choices
Elasticity• Scale up applications without
purchasing infrastructure
Lower costs• Pay-per use• Low/no fees to get started
Distribution• New way to make pre-configured
apps and stacks available on a global basis
• No infrastructure purchase required for customers / end users
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“It’s Not About The Money….”
“Oh Yes It Is!”
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Considerations for Cloud Monetization
Economic modelsDistribution / SalesService DeliveryOther subtleties and complicating factorsAutomation
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The “Dark Side” of Pay-Per-Drink
“Pay-per-drink” is the early dominant model for cloud application usage“Grew up” at Infastructure-as-a-Service (IaaS) layer, largely driven by Amazon.com and DevPayGood fit for infrastructure• Storage• CPU• Memory• Bandwith
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But The Cloud Isn’t JUST Infrastructure
Compute | Network | StorageInfrastructure
Components | ServicesPlatform
User Interface | Machine Interface Application
Cloud Computing Stack Monetization OpportunitiesUsers, Seats,
Features
Content, Security, etc.
Storage, CPU, Bandwidth
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Economic Models: Monetizing Your Value
The cloud doesn’t have to take away your ability to monetize the value of your application.How do you measure that value?• Transactions?• Records?• Views?• Service Level?• Features?• Seats?• Songs?• Instances?• Combination?
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Resellers and distributors can be force multipliers in the cloudHow do you sell and distribute your application?• Online?• Direct?• Via Partners?• Geographic Resellers?• OEM’s?• Changing mix over time?
Considerations• What can they sell?• How do they get paid?• What’s your connection to the end
customer?
Distribution / Sales
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Delivery
Someone just purchased your cloud-based serviceWhat do they need to use the service?• One or more accounts?• Physical device?• How many of your services
need to be turned on?• What about third-party
services?
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Other Subtleties and Complicating Factors
Time-bound free trials• Opt-in or opt-out
Freemium products and services• Track usage or time to provide targeted “upgrade” notices
Pre-paid usage• Tracking debits against pre-paid credits• Reminding subscribers when it’s time to re-up
Hierarchical accounts• Associating “household” accounts in B2C• Associating departments and business units in B2B
B2B• Custom contracts, discounts, etc.
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The Automation Imperative
Preserving margins with cloud-based apps requires significant automation• Subscriber signup (including
channels)• Activation of services• Management of entitlements• Billing and payments• Customer service and online self-
service
Without automation, you can’t scale, and miss out on the opportunity of cloud computing
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Real-World Examples
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Real-World Examples: SaaS Startup
Launch of AWS-based collaboration platform for designers and marketing/ad agenciesChallenges• Automating monetization
of discrete feature values• Value of application had
no relationship to storage, bandwidth, or other units supported by Amazon DevPay
Voice Over IP
Video Conferencing
File Storage
Future Add-ons
Core Application
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Real-World Examples: EMC Mozy
Offering cloud-based backup for consumers and small businessesChallenges• Subscription fees plus usage
(storage)• Multiple OEMs and
distributors• Branded signup and self-service• While retaining pricing and
offering control for Mozy
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Real-World Examples: RightScale
Offering management tools for popular cloud platformsChallenges• Billing for millions of hours of usage
in dozens of countries• Accepting multiple payment
methods – net terms (B2B), check, credit card
• Tracking usage during free trials• Customized B2B contracts with
changes to rates and usage tiers per-contract
• Providing integrated invoicing for B2B customers with multiple departmental users of RightScale
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Questions?
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Resources
www.ariasystems.com• Product information• Customer examples• White papers and technical information
www.ariasystems.com/contact• To contact our team
[email protected]’s speaker• Robbie Forkish, [email protected]• Lance Walter, [email protected]
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Thank You!Monetizing the Cloud
Aria Systems
Billing and Subscription Management
Robbie Forkish, Senior VP, Engineering