Tag Archives | Pricing / Licensing

Amazon S3: No More Flat-rate Pricing

What does it mean when a vendor adopts flat-rate pricing, but later moves away from it? Does this mean the vendor misjudged the market initially or wised up and found new ways to exploit their customers? The truth is both more and less complicated than any of these explanations.
Amazon is in the news because they announced that as of June 1, they are introducing tiered pricing for parts of their S3 web services. Amazon’s announcement states that many customers will pay less and some will pay (a lot) more. To understand what is going on, it helps to understand a little about pricing theory and practice.

Oracle Simplifies Licensing, Again

What do you do if you have a mature product and the market gives you grief over your complex pricing? You have to do something, but what you do depends on your level of market power and your view of pricing. With Oracle’s latest pricing announcement, one gets the sense that Oracle is still being Oracle. That is, this is the latest installment in Oracle’s attempt to update pricing without actually changing their pricing much. As the category leader, they get pressure to lower prices but know that they don’t have to do so. So while the headline suggests Oracle is simplifying, they are not. They remain, as ever, optimized for revenue capture.

Value Models: Many Ways to Skin a Cat

As in any innovation-driven market, software vendors continue to develop and exploit a variety of business models, most recently a variety of “free” services. Unlike the period of the Internet bubble, during which companies failed because they didn’t monetize their services, many of today’s “free” services are well thought out and are likely to become successful businesses. While this article looks at the monetization side, it is equally important to note that these companies leverage Web 2.0 tools and consequently have dramatically lower development and operating costs than their Internet bubble predecessors.

Virtualization at SoftSummit: Sexy, not Even!

SoftSummit 2006 (a conference led by Macrovision) happened a couple of weeks ago. I was there as a speaker so got a chance to meet some good people. Much of what was discussed was the same old, but one session stood out.
One topic over lunch on Wednesday was this: “Virtualization Takes Over the Enterprise.” Raghu Raghurum, VP of platforms at VMWare and Chad Jones, Sr. Product manager at Microsoft were the two content leaders.