From Licensing to SaaS
How did that come to be? All pricing attempts try to emphasize the "value" of product or service we sell.
In other words, you get what you pay for. Low-value products and services will likely cost you less than high-value products and services.
In SaaS, the concept of a per-user pricing model is based on the premise of customers deriving more value if more people use the product or service.
Historically, a lot of on-premise software licensing models worked this way (think the old days of Microsoft).
Every desktop represented a separate user, and a copy of the application which was physically installed was sold as a license. Although many companies still pursue the licensing model path, the IT industry evolved over time into a SaaS.
The SaaS world allows a lot of flexibility.
So why is per-user pricing still so common?
In addition to the historical connection, per-user pricing is simple to explain and understand, even for a person with no IT background.
Compare to licensing, SaaS does not require any complex installations and updates.
Typically, the process of getting started goes like this: you create a user account (email address) to log in, count the number of users logging in, and calculate the bill.
This is an easy way to go, especially for companies that are under pressure of rapid growth.
Fusebill is an example of SaaS subscription billing management platform that simplifies and fully automates all your recurring billing. Click on the button bellow to learn more about how Fusebill can help manage your recurring billing.