Does Subscription Pricing Fits a Shrink Wrap Software Model?
See post on subscription based pricing for software - Feld Thoughts: Subscription Pricing.
I could not agree with one comment Brad makes in his post - “Make sure you separate concept of the way you sell your software (subscription vs. perpetual) from the way you deliver your software (ASP / hosted vs. “shrink wrap” – remember when Apple II and TRS-80 software came in ziplock bags). I find that - even today – lots of folks that I talk to get tangled up in the difference between these two constructs.” - I think that although you can artificially separate the pricing model from the software delivery model still there is a very tight link in the way you combine these two models that enforce sometimes a specific pricing model for a specific delivery model and vice versa.
If we consider a software being delivered as a hosted service for example, a subscription based pricing sounds much more logical both to the buyer and the seller due to the tight dependency between ongoing costs of providing the software and the same savings the buyer experiences. I do not say that you can not enforce different pricing models on different delivery methods but taking a subscription fee on a software package that does not require data nor software updates (such as my UPS management software) and chargning a subscription fee for it will look awkward for buyers.
The subscription pricing model has been born and embraced to accommodate the new ASP/hosted/utility delivery model and nowadays it does seem thoeritcally possible to use it freely on any software delivery method but it does not always fit.
