Novell Changes Pricing Model

In an attempt to make its offerings more appealing, Novell is providing new pricing for services accessed over the Internet in Business-to-Consumer and Government-to-Citizen situations.  Novell will be charging 25% for customer licenses and 10% for government citizen licenses of what it normally charges for employee users of its software (on the perfectly valid theory that these are more casual, less frequent users). 

But while lower prices are always better than higher ones for customers, we’d say that Novell (and others who follow these pricing models) continue to show a remarkable lack of understanding for their customers’ needs.

It is absurd to think that a corporation – or a government agency – is somehow going to identify in advance and buy a license for every potential customer or citizen it might need to service.  The entire point of the Internet as a communication medium is ease of access.  Appropriate pricing models require that the customer – corporate, government, or other – be able to buy a license based on number of servers or other suitable volume metric and not buy individual named user licenses, regardless of their price. 

Simultaneous user licenses are also acceptable as a pricing model in this environment (although they sometimes lead to frustrated users if all the licenses are in-use at peak periods).

Traditional vendors who come to the Internet from earlier deployment models need to notice that times have changed and figure out business models that fit the ways in which their customers are now conducting business, lest they become so unappealing that their customers simply leave them for more modern products.  In this case it’s not the products that need adjusting, but rather the thinking behind the business models. 

(back to top)