Although perpetual licenses – the kind of software license you make a once-off purchase of to gain forever – are still plentiful, subscription-based licenses (also known as software-as-a-service) are becoming an increasingly popular model. So with perpetual licenses being the tried-and-true method and subscriptions being the exciting new kid on the block, which one should you be choosing? More ost of perpetual licenses versus the yearly cost of subscriptions, it can be quite hard to work out which is the more affordable option. In this article, we take a look at both of these avenues to work out which one is the cheaper option for yoimportantly still, is one more affordable than the other? Considering the large up-front – but once-off – cur business.
The key differences between these payment formats
First off, we want to properly define what these respective formats are – subscriptions for business owners might resemble something like Microsoft Office 365 Business or Adobe Creative Cloud, while a perpetual license might be something like Microsoft Office 2019. The Office 2019 Suite is a one-off purchase that is used on one computer, while Office 365 can be used from any computer, anywhere you are and is paid on either a yearly or monthly basis depending on the wants and needs of the customer. The differences go far beyond these basics, though – in the case of subscription software, the software that you are subscribed to is not actually a constant product, and is always being improved upon. This is due to your subscription fee also including all of the maintenance, upgrades, and technical support that you might need. Although you might think the large up-front cost of the perpetual license might be the end of your spending, many software providers also add on a yearly maintenance fee covering incremental upgrades and support, which some may view as a hidden cost.
Where software as a service excels
One of the biggest benefits of subscriptions is not just minimising the upfront cost, but the substantial time and hidden costs that are involved. You might think that the upfront cost of a perpetual license might be all you need, but this fails to take into consideration the need for servers, storage, infrastructure management and the equipment needed to efficiently run the software itself. Although some prospective customers may believe that the use of the shared cloud may raise some security red flags, this shared infrastructure represents no more an issue than the traditional perpetual software landscape due to the constantly updated online security. Similarly, any bugs that are reported by users of subscription services are managed much faster than traditional software models, meaning that you can mitigate any issues that will prevent your and your workspace from working as efficiently as possible.
The end of perpetual licenses?
Although it is a very established payment model and is still seeing use, there are a few signs that point to the perpetual license model slowly becoming redundant over the next few years. Although this model will always have a few diehard users, the flexibility and affordability of subscription software will eventually mean that the older format is dumped by many software companies, making now a very good time for small businesses to jump onto the software as a service wagon. It all depends on where your business is at, though – make sure to think long and hard about any big decisions before you take the plunge!