What is a Licensing Model?
Definition
Software pricing structure including per-user, per-feature, tiered, usage-based, or flat-rate pricing. Licensing models affect scalability, budget predictability, and total cost with common options being named user, concurrent user, or organization-wide unlimited licensing."
Why This Matters
Licensing models including per-user, tiered, and usage-based have different cost implications as you scale. Understanding how each model scales with your growth helps predict long-term costs.
Related Terms
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Essential Connections
Pricing Section
RFP Fundamentals
RFP section requesting detailed cost breakdown including licensing models, implementation fees, training costs, support tiers, customization charges, and renewal rates.
Total Cost of Ownership
Pricing & Total Cost
The complete cost of software including licensing fees, implementation costs, training expenses, data migration, ongoing support, customization, infrastructure, and maintenance over 3-5 years.
Scalability
Software Features & Capabilities
Software's ability to handle growth in users, data volume, and transaction load without performance degradation.
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