Providers of software monetization/software license management tools are gradually shifting away from business models focused on traditional user- and site-based licensing policies to monetization models centered on the actual use of on-premises and cloud software, according to the latest research from Frost and Sullivan.

The three key SLM functions include defining software versions and licensing rules (development), automating license issuance and invoicing (deployment) and ensuring that software is used in accordance with terms of a purchased license (enforcement), according to the firm.

Software monetization solutions provide greater flexibility and lower costs for organizations, Frost & Sullivan said. SLM products are gaining popularity as they allow software publishers and intelligent device vendors worldwide to efficiently monetize their products, particularly for enterprise, networked, and cloud-based deployments.

While business-to-business publishers are the most mature users of software monetization technologies, intelligent device manufacturers are becoming a growing end-user segment.

"With the rise of the Internet of Things, embedded device vendors are actively embracing SLM technologies to limit counterfeiting on the production line, achieve dynamic adjustment of product stock keeping units after deployment, and manage complex licensing models," Avni Rambhia, Frost & Sullivan digital media research industry manager, said in a statement. "As SLM solutions become more user-friendly and compatible with new deployment models such as virtualization and mobile computing, they will attract other vendors not only for protecting top line revenues through piracy management, but also to dramatically improve the bottom line through software-based SKU management and usage analytics."

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