A number of trends are fueling business growth and profit strategies for hardware device vendors today. What forces are driving these trends? What are the challenges vendors face when transforming their businesses to address these trends? And what can they do to manage the transformation and take full advantage of the opportunities for business growth?LEARN MORE
Sentinel LDK 7.5 broadens its licensing and protection to include additional operating systems and platforms.
The already small footprint of secure licensing solution Sentinel Fit is reduced even further in version 1.1; packing in the same great software protection with web-based entitlement management capabilities.
Streaming video over the internet has become a popular alternative to traditional distribution channels, and the creation of that content requires a powerful set of software-based tools. We asked Jeremy Courtney, Business Leader at Snell, how the company went about licensing its new technology and protecting the valuable intellectual property contained in its source code.READ THE Q&A
A number of trends are fueling business growth and profit strategies for hardware device vendors. Today, more and more hardware device vendors are transforming their business models from one-time sales transactions to ongoing relationship-based models with recurring revenue streams. Increasingly, device vendors are leveraging the software within their hardware devices to innovate and differentiate their devices in order to gain a competitive edge and grow their businesses.
What forces are driving these trends? What are the challenges vendors face when transforming their businesses to address these trends? And what can they do to manage the transformation and take full advantage of the opportunities for business growth?
Pricing pressures and lower margins for hardware products
Device vendor revenue has traditionally come from the sale of physical devices. As devices have become more commoditized, device vendors have had to deal with pricing pressures and lower margins. Embedded hardware vendors spend up to 70 percent of their development effort in the software that resides in their devices. The software has become the unique selling proposition and provides the real value. However, if device vendors are unable to charge for and license specific features and functionality, they won’t be able to capitalize on the value inherent in that software.
End customer preferences and perception of value
Perception of value is defined by the demands of end customers; namely a frictionless customer experience, more budget-friendly ways to purchase, and easy-to-access upgrades. Many device vendors want the flexibility to scale up or down based on end-customer demand and device usage. Therefore, they need a way to offer the capabilities and functionalities that their customers value and are willing to pay for, while providing the best possible customer experience.
As device vendors transform to selling value, they face additional challenges such as the cost and complexity of supporting numerous hardware product variants, gray market revenue leakage, and revenue peaks and valleys caused by shorter replacement cycles.
Gemalto’s Director of Product Management, Laila Arad-Allan, addresses these and other issues in her recent interview with SandHill.com. Arad-Allan describes the biggest pitfalls vendors should avoid as they undergo this transition. Read the article for a detailed explanation of how device vendors are successfully transitioning from selling boxes to selling software-enabled value.
‘Servitization’ refers to the transition from manufacturer to service provider and is completely redefining the traditional manufacturing business model.
Although the trend has recently been gaining traction, servitization is not a new concept. It was first introduced in the 1980s, when Rolls-Royce and General Electric radically changed the way aircraft engines were sold. These companies began selling engine “power by the hour” instead of selling individual engines. The airlines were then able to pay according to the utilization of their planes, rather than paying everything up front.
Rolls-Royce inspires a growing number of manufacturers to view “product as a service” as a core component of their overall value proposition and a revenue generator in itself.
For more on this topic, join our Ask the Experts webinar featuring Dr. Mohamed Zaki, Research Associate at Cambridge Service Alliance, and Andreas Eichele, License Operations Manager at Kuka Robotics.
In this session, we will explore:
The webinar will be held in English on December 13 at 11:00 EDT. Click here to register! A recording will be sent to all registrants.
Ask the Experts is a quarterly webcast series introducing new trends in the licensing, entitlement, and protection space. To access the previous session, click here.
With another successful LicensingLive! event behind us, we look back at some of the highlights to emerge from Cupertino. This November, industry experts and senior software leaders came together to discuss the topic at hand: next-generation monetization strategies for embracing the NOW economy. The idea, in case you missed it, is that due to widespread IoT connectivity, customers today expect to be able to consume applications and services on-demand and on their own terms. Hardware manufacturers are transforming their business models accordingly, offering innovative software products that require innovative licensing.
Among the real-life case studies and product demos on display were presentations by IDC, Juniper, THINKstrategies, Simon-Kucher & Partners, Trimble, NetApp, Ericsson, Aria Systems, Frost & Sullivan, and Grey Heron. As a special treat, future Hall of Famer Terrell Owens gave a talk on the connection between the IoT and the NFL.
The turnout at this year’s event was excellent, with almost twice as many registrants as in the previous year. Attendees ranged from business leaders to software developers, hardware engineers, product managers, and executives. They came with a common desire to solve the latest software monetization challenges and went home with (hopefully) a better understanding of how to deliver customer-driven value, reduce costs, and significantly grow their business.
If you were unable to attend, you can view the recorded presentations and more here.
Please join us for our upcoming webinar, presented by Jeff Kaplan, Managing Director, THINKstrategies, and Jam Khan, Director of Professional Services, Gemalto. In this session, Kaplan will take us through the key critical components of an effective software licensing and monetization program. Kahn will explain the new Software Monetization Best Practices scorecard and discuss how a readiness score can help you define and measure your licensing lifecycle. You can expect to learn about licensing and entitlement best practices that are common to all verticals, and the methodology that will help you determine specific areas for improvement in automation and efficacy. Register today!
Thursday, December 15, 2016
12:00 PM EST/ 9:00 AM PST
The new features and improvements introduced with this release are as below:
The new features and improvements introduced with this release are as below:
Additional License Enforcement Options: Sentinel Fit licenses now offer protection by industry standard symmetrical AES cryptography in addition to the existing asymmetrical RSA cryptography.
Ultra-Small Footprint Goes Even Smaller: Introduction of symmetric AES cryptography further reduces the licensing footprint size to 6.5KB Flash and 1.5KB of RAM as oppose to 34KB Flash and 13KB of RAM for asymmetric RSA cryptography.
The broadcast industry is rapidly changing. We need only look as far as over-the-top (OTT) services such as Hulu and Netflix to see that traditional billing models are in a state of disruption. Streaming video over the internet has become a popular alternative to traditional distribution channels, and the creation of that content requires a powerful set of software-based tools.
Snell, the world leader in broadcast and postproduction technology, is addressing these needs with Snell on Demand; a software framework that allows customers to run its image processing products on a per-use basis. We asked Jeremy Courtney, Business Leader at Snell, how the company went about licensing its new technology and protecting the valuable intellectual property contained in its source code.
LEAP: Snell is renowned for its high-quality media processing technology and has even won an Emmy award for its algorithms. At what point did the company realize it needed strong security to protect its intellectual property?
JC: Before we could offer our Quasar OD and Alchemist OD software commercially, we knew we had to protect our source code from reverse engineering and tampering. Our intellectual property is what differentiates our products, so it was critical that we have in place a licensing technology that offers maximum protection.
LEAP: How valuable is IP protection to Snell?
JC: It’s hard to quantify the ROI of implementing protection exactly, but if our IP was not protected and fell into the wrong hands, it could be financially devastating.
LEAP: Besides IP protection, what other requirements did Snell have when evaluating commercial software monetization solutions?
JC: We looked at various options for licensing and fulfilling software orders, and then managing them once in the field. It was important that our products could be ordered through the company’s online store and that the fulfilment and software activation process could be automated. It goes without saying that all licensing and enforcement operations had to be virtually invisible to the customer so as to ensure the best possible user experience. And because our increasingly digital-savvy customers want to consume media on different operating systems and devices, our ideal solution would also provide cross-platform support.
LEAP: Talk us through your choice of Gemalto Sentinel solutions.
JC: We needed to protect the intellectual property in our source code while offering and enforcing a variety of licensing models and packaging options for our products. Sentinel RMS did all that and more. It gave us the ability to easily enable or disable product features within our Snell on Demand software framework, saving us the added overhead of building custom hardware products.
LEAP: Snell also opted for our entitlement management solution, Sentinel EMS.
JC: That’s right. We use this to manage entitlements for our Quasar OD and Alchemist OD software, as well as back-office licensing operations such as fulfilment and activation. In fact, we integrated the Sentinel EMS license server with our Snell on Demand store to enable complete customer self-service; from online payment through upgrade. Gemalto even had the foresight to supply us with a Salesforce.com connector, ensuring future integration of Sentinel EMS with our CRM system.
LEAP: How has Snell benefitted from the integration of Sentinel RMS and Sentinel EMS?
JC: Sentinel has helped us in a number of ways; we are now able to protect our source code from reverse engineering and we can deploy our software packages easily and securely. It has eliminated the need for manual fulfilment processes, which not only saves us time, but also reduces operational costs and the potential for manual errors.
LEAP: What impact has this had on stakeholders in your organization?
JC: Our engineers use Sentinel RMS to protect the Snell on Demand software framework. At the same time, Sentinel enables product managers to decide which products to invest in, and how to package and price individual features.
LEAP: What were your expectations going into the licensing process and how does your experience of working with Gemalto compare?
JC: When we embarked on this process a year ago, I didn’t anticipate just how complex the licensing part of the project would be! Gemalto pre-sales staff helped us think through the problems we were trying to solve and then how to apply licensing so that there were no negative operational consequences downstream. They’re always thinking about the next step before it’s even an issue for us, so there is a solution ready to deploy as and when we need it.
LEAP: On balance, would you say that Snell has achieved what it set out to do?
JC: Indeed. Working with Gemalto, we’ve managed to secure our competitive advantage and grow our business through flexible and scalable licensing. Sentinel gives us the peace of mind that we aren’t leaving any money on the cutting room floor.
As summer draws to a close, Gemalto bids farewell to its CEO, Olivier Piou, who has served the company for the past 10 years. In his parting remarks, Piou lauded the combination of talent and teamwork that has enabled Gemalto to innovate and, ultimately, revolutionize the way consumers pay, bank, travel, and communicate. He also had high praise for his successor, Philippe Vallée, whom he describes as having a “visionary approach and superior skills” that will help prepare the company for its next phase of growth. Piou will continue to support Gemalto’s future expansion plans as a member of its Board of Directors.
Gemalto’s newly appointed CEO looks set to continue in the footsteps of his predecessor. Vallée shares the belief that human capital, as much as technology, makes Gemalto a leader in its field. He has stated that in our fast-paced world, where markets are rapidly converging, it is important to listen to the needs and challenges of customers in order to fuel investments and innovation. According to Vallée, the cornerstones of a successful business are agility, curiosity, and teamwork; core values he intends to promote during his tenure. He has stated that no further organizational changes are planned for the foreseeable future. Read the press release.
Challenges within the med-tech industry have led to a rise in adoption of flexible usage-based business models. The Pay-Per-Use model enables independent physicians and small medical centers to access expensive equipment they otherwise could not afford, while keeping their capital expenditure low. The cost-saving benefits for all stakeholders are significant, opening up manufacturers to huge untapped markets.
Gemalto Sentinel is at the forefront of this evolution as it enables medical equipment manufacturers to extract the most value from the software embedded in their devices. To learn about our software monetization solutions for the med-tech market, visit the new medical section on our corporate website, which contains customer testimonials, case studies, presentations, and more. Click here to visit the page now!