Software Licensing and Asset Management: Trends and Insights

In the technological space, the software licensing and asset management industry is a constantly changing landscape.

Nowadays, providers can no longer solely dictate the terms of how they sell and price their products.

Customers are more discerning and judge the software by its ability to contribute value.

Another recent change was brought about by the COVID-19 pandemic.

With the shift to remote working environments, there continues to be a strong demand for software to be more accessible for both consumers and businesses.

Unless businesses adapt, they might not be able to offer what the market needs, which means their position in the market is not secure.

Fortunately, industry trends and insights can help organizations understand consumer demand and develop products with their customers in mind.

Knowing these will also allow businesses to evaluate and optimize their software licensing approach, leading to new and innovative revenue streams and increased operational efficiency.

In this article, we’ll introduce you to key trends and insights you need to know to help you navigate the software licensing and asset management space.

Software Licensing and Asset Management: An Overview

For the uninitiated, software licensing management and software asset management are disciplines of the broader IT asset management (ITAM).

Here’s what each subset means:

Software licensing management (SLM)

This is the process of reducing, documenting, tracking, and controlling the software used in a company. SLM helps organizations monitor and maintain all their various software licenses, ensuring they avoid non-compliance with software vendors and the penalties that accompany a compliance breach.

Software asset management (SAM)

This business practice focuses on determining the right software type, quantity, or function an organization needs. It also helps manage and optimize the purchase, deployment, maintenance, and disposal of various software applications across the organization.

Here’s a look at how asset management trends and software licensing trends can affect or help your business.

The software asset management market is expected to be worth 4.8 billion by 2026

Business organizations recognize the importance of software asset management now more than ever, which explains its accelerated growth.

Through SAM, you can identify the number of licenses you have from every software vendor and then assess the usability of the software across your organization.

Under-utilized software needs to be reevaluated or redistributed to departments where it can be fully utilized.

Furthermore, SAM is used to ensure an organization’s compliance with regulatory standards.

Software audit activity from software vendors is on the rise


Software vendors that have not been traditionally active in auditing will start to push for software license audits.

Given the increased competition from smaller vendors and the lack of innovation on newer versions of most software, there exists a value gap where businesses have become slower to upgrade.

These give way to declining revenues, and software companies need to figure out how to close the revenue gap. Furthermore, with the ongoing recession, software companies may experience flat or decreased sales.

Vendors are relying on audits to make up for lost revenue and consolidation in the industry.

Expect certain vendors to aggressively increase their efforts to ensure license compliance. Non-compliance can carry hefty penalties. Without accurate usage metering tools, organizations should be wary of vendor audits.

Traditional software licensing schemes are shifting to more flexible buying models


In the past, customers would find themselves buying an entire package of licensing software because that’s what was available or offered to them.

Even if they were not certain how they would use the product in their organization, there was no other recourse but to buy in bundles.

The good news is, that’s no longer the case today.

Customers now have more freedom in choosing which assets to invest in as part of their license management software agreement with the vendor.

From trial to paid subscriptions, vendors are letting end-users decide which products and features will be more useful for their business.

The Rise of Cloud Asset Management

Cloud offerings and the process of determining what exactly is required with premium features have become increasingly complex.

This means overcharging may run rampant.

Vendors are expected to shift from traditional software licensing schemes to consumption-based models.

Thus, to control costs, the importance of being able to monitor cloud-based applications and services in real time has become more evident.

For instance, if a user is only licensed to access the basic features of a specific software, some premium features can also be made available at a click of a mouse. When they access these premium features, your company must license them as such.

Real-time reporting is crucial, so you can determine what employees have access to and which features are active.

This will encourage the shift from traditional software asset management to cloud asset management.

Cloud asset management is an optimized and secured process, as it provides visibility and control over all assets in the cloud infrastructure.

Through it, organizations can keep track of their cloud assets as cloud infrastructure runs smoothly.

IT is going green, too

Green IT recognizes that business organizations have an important role to play in promoting sustainable development.

Specifically, companies must strive to minimize the negative impact of technology consumption on product chains and ecosystems.

To achieve this goal, businesses must start making ecologically sound choices and decisions, such as extending the lifecycle of software licenses.

This way, energy consumption can be drastically reduced as it takes more energy to develop something from scratch than reusing, recycling, or repurposing company assets.

    Riding the Tide of Change

    Software licensing and asset management trends will always be an ever-changing industry—and will continue to move forward.

    To thrive in this environment, your business must foster a culture and environment that is highly adaptable and willing to embrace change, starting with relevant software solutions.

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