Executive Summary

In 2022, the fourth year of Revenera’s Monetization Monitor research, respondents are still in the midst of moving to subscription monetization models and SaaS deployments, and continue to see the biggest growth opportunity in these areas. With reliance on perpetual licensing and on-premise deployment models also holding strong as part of a hybrid approach, producers need clarity into how their software is being used in order to make informed product roadmap decisions.

The driving force behind changing entitlement management and licensing strategies in the next 12–18 months is to “better support pricing and packaging changes.” In the move to secure recurring revenue and optimize the entire quote-to-cash (Q2C) process, software suppliers must support multiple monetization and deployment models in entitlement management systems. And they need to support how customers want to pay for and consume software, not only as subscription/term monetization models maintain their popularity, but as interest in consumption and metered models grow.

Great opportunity exists for software suppliers to strengthen their monetization practices. Only about one quarter of respondents feel that they can gather product usage data very well. Fewer than one in three respondents feel that pricing is totally aligned with the value they provide to customers. By improving these metrics and making informed decisions based on them, suppliers can move toward their revenue goals.

The present report takes the pulse of software producers, offering benchmarks to help technology companies manage the complexity of hybrid monetization and deployment models. It illustrates the importance of data and analytics in providing insights into utilization, adoption, engagement—and ultimately success for software suppliers and their customers.

The trends toward SaaS deployments and subscription/term monetization models continue for the 4th year in a row, as hybridization in deployment and monetization models continues.

The top reason for changing licensing strategies in next 12-18 months is to “better support pricing and packaging changes” (35%).

In the next 12–24 months, 18% of respondents plan to gather product usage data, twice the rate (9%) reported in 2021.

Interest in consumption-based monetization models is growing, with 41% planning to implement, echoing the 2021 report on increased interest in usage-based models (37%).

The Revenera Monetization Monitor 2022 Series

This report is part of an annual series, first published in 2019, focusing on software usage analytics. This report focuses on software monetization models and strategies. Subsequent reports in the Revenera Monetization Monitor 2022 series will address software usage analytics and software compliance & piracy. All reports are based on a global survey of 261 responses to a survey conducted by Revenera from mid-April through mid-July 2022.

Software suppliers show an ongoing reliance on using multiple software monetization and deployment models across their business.

Software Deployment Models Today

While on-premises software deployment will have a long tail (with 31% of respondents still making extensive use of this model), growth of the SaaS model is strong (59% of respondents anticipate growth in this model in the next 12-18 months as seen in the next section). The move to SaaS is driven in part by end customer demand for ease of access to the latest version of applications and more flexible models of paying for software (subscription, usage-based, etc.) that often go hand-in-hand with SaaS.

The move to SaaS will continue: 59% of respondents indicating that reliance on it will increase in the next 12–18 months. Cloud deployments also show strong increases, with use of private cloud and public cloud set to grow for 49% and 45% of respondents, respectively.

The most significant declines come from on-premises (declining for 33% of respondents) and embedded software (declining for 19%).

As suppliers move to tighten license controls, accurately price usage, and lower barriers to entry, multiple drivers are in play. Top among the planned changes in the next 12–18 months: “better support pricing and packaging changes.”

The move to usage-based licensing continues to be strong. Nearly 1 in 3 respondents (29%) indicated that they’ll implement this strategy. Among those respondents whose organizations currently gather product usage data very well, this number goes up to 35%, perhaps indicating that clarity into usage helps drive interest in the accuracy provided through usage-based licensing.

The Revenera Monetization Monitor: Software Monetization Models and Strategies 2022 is based on 261 responses to a survey conducted by Revenera from mid-April through mid-July 2022. This research project looks at software producers’ software business models, pricing, usage and transparency. Due to rounding, percentages may not always appear to add up to 100%.