Patterns for Monetizing the IoT

© 2015 Flexera Software LLC. All rights reserved. | Company Confidential1

Edward McNeilSoftware Monetization ServicesFlexera Software

Patterns for Monetizing the IoT


New Business Models

Industrial IoT =

Opportunity

Challenge

Data, Data, Data …

Hardware + Software+ Connectivity


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


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 ?



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:


New Products & Services• Pay-per-use• Software-based services• Data-monetization


Near-Term Long-Term

Cloud Based Power Management SoftwareRecurring revenue subscription license model for cloud-based IT systems management control and monitoring.


Outcome Economy• Pay-per-outcome• New connected ecosystems• Platform-enabled marketplace


Near-Term Long-Term

Ultimate OutcomeCharge per hours of operation, and provide all ongoing maintenance and support.


Autonomous, Pull Economy• Continuous demand-sensing• End-to-end automation• Resource optimization & waste reduction


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.


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


How Do I Get Started? Prepare . . .

Define . . .

Execute . . .Go‐To‐Market

Software


How Do I Get Started?

Act Quickly


THANK YOU!

www.flexerasoftware.com/swm

Edward McNeilDirector Software Monetization ServicesFlexera [email protected]