Use licensing and entitlement management to capitalize on the internet of things opportunity

1. DATASHEET
Use Licensing and Entitlement Management to
Capitalize on the Internet of Things Opportunity
FlexNet Producer Suite for Intelligent Device Manufacturers
The proliferation of intelligent, connected devices and
the business solutions made possible with software
present a wide array of lucrative opportunities for
device manufacturers to monetize and leverage the
Internet of Things (IoT). In this increasingly connected
and intelligent world, device manufacturers are using
embedded software and applications to differentiate
while electronically controlling device capacity and
capability, opening up entirely new markets and
value-added services.
Device manufacturers that provide intelligence
through software are able to:
• Monetize with innovative and flexible new
licensing, pricing, and packaging models
• Differentiate and protect their offerings in
highly competitive markets by delivering
more value to customers
• Uncover new revenue opportunities from up-sell/
cross-sell activities and new licensing, pricing,
and packaging models
• Reduce manufacturing and inventory costs
• Provide more value-added proactive support
Many device manufacturers are also battling
commoditization and the risk of grey market abuse
of their core hardware products, so they are turning
to software and applications as a means to meet
customer demands and bring products to market faster
with greater business value.
Increasingly, device manufacturers are finding new
opportunities to extend the value of the software,
whether it’s used to control the device or leverage data
from the device, by connecting them and uncovering
new ways to leverage and monetize the Internet of
Things (IoT) ecosystems.
“Internet-connected
devices powered
by software and
controlled via licensing
and entitlement
management systems
open up myriad new
revenue opportunities.
For instance, innovative
companies can
leverage data reported
back by the device
on its operational
status and behavior to
develop new product
and service offerings.
Internet-connected
devices also can open
up potential exposure
to hackers, so device
manufacturers also
need reliable methods
to monitor for such
risks and repair any
vulnerabilities that
may arise.”
Amy Konary
– Research Vice
President - Software
Licensing
Provisioning at IDC
Internet of Things Ecosystem
Source: IDC, 2013 by 2020–IDC, 2013
Professional Services
Security
Connectivity
Big Data/Analyti
cs
Applications
Platforms
Intelligent
Systems
Internet of Thing
s
212 billion units
Internet of
(autonomously)
connected things
30 billion units
Figure 1: IDC, Worldwide Internet of Things 2014 Top 10 Predictions: Nascent Market Shakes Up Vendor Strategies, doc
#245578, January 2014.

2. Creating intelligent devices and solutions for the Internet
of Things offers device manufacturers the following
business benefits:
Drive Topline Growth and Recurring Revenue Streams
• Create unique, differentiated solutions that deliver
greater business value to customers
• Monetize of all aspects of their intellectual property –
products (devices and software), capacities, capabilities
and versions
• Support an array of pricing and licensing models
(e.g., concurrent, subscription, usage-based) to meet
varying market needs
• Enable new deployment models, such as virtual appliances,
and provide add-on services using cloud deployments to
appeal to varying market segments
Reduce Costs
• Control and provision the capabilities and capacity of
devices electronically
• Reduce manufacturing and fulfillment costs and control
contract manufacturers
Deliver Excellent Customer Experiences
• Provide 24x7 customer access to software products and
licenses through a self-service portal
• Establish direct relationships with customers through
multiple tiers of distribution
• Support the entire licensing and entitlement lifecycle
to maximize up/cross-sell and recurring revenue
Another important benefit to connecting devices is the data that
is being collected. Taking that data and analyzing it in a myriad
of ways provides unique insights into the use of your products.
Having accurate, aggregate-level product data enables Product
Managers to make more intelligent marketing and Product
Development decisions. With the ability to view relevant
application log files on remote devices support technicians can
proactively diagnose customer issues, debug application issues,
and send software patches directly to the device to ensure
customers receive uninterrupted service. For example, knowing
when a pump is close to failure or a device is running old
software or firmware, so that it can be updated before issues
arise and the customer has to call for support.
Data such as device-specific profile information, application
updates and event data can be leveraged to trigger revenue
generating opportunities for product upgrades, add-ons or
service calls – expanding the device manufacturer’s relationship
with the customer and increasing revenue.
The diversity of use cases and benefits of the Internet of Things
ecosystem are expanding to include using the data collected to
find additional ways to monetize the offerings from the device
manufacturer. For example, new business models can be created
when the connection is used to share usage data from the
device. Users of a device can be charged based on the number
of discrete uses, usage levels during specific times of the day,
concurrent number of users within an enterprise, geographic
location, use of specific features, or any number of parameters.
This data can also be aggregated and analyzed for
improved business intelligence. Monitoring patterns of
usage consumption can:
• Increase sales activity for the products or features that are
most highly valued, and in the most receptive markets
• Up-sell users to new levels of functionality or renew them
at the most opportune time
• Focus development on the most valuable features, on the
most widely deployed platforms
Internet of Things Ecosystem
According to IDC, the layers of the IoT ecosystem will uncover
new revenue opportunities for device manufacturers. By 2020,
IDC expects the entire market for IoT to generate $8.9 trillion
with an installed base of 30 billion connected “autonomous”
devices and an overall addressable market of 212 billion.
The intelligent systems (devices) and the applications – the
embedded software or software tools that capture analytics
– are at the core of the Internet of Things ecosystem. For
that reason, device manufacturers need a way to increase
and manage application usage, monetize and protect their
IP, provide timely and secure software updates, and collect
installed base and remote device analytics in order to
increase the value and management of their devices and
build a sustainable digital supply chain ecosystem. The
hardware, software, services and communications
ProfessionalServices
Securtity
Connectivity/Service Enablement
Intelligent Systems
Applications/Vertical Industries
Analytics/Social Business
Platforms
Device, Networks Application Enablement
Figure 2: IDC, Directions 2014, The Realities of Internet of Things IoT,
Presented by Vernon Turner, Senior Vice President, IDC.

3. infrastructure that makes digitization possible are the keys to
uncovering new and recurring revenue opportunities. Digital
products and services form the backbone of new business
models that have different economics, operating models,
and customer expectations.
Device manufacturers are embracing the opportunity to move
beyond a device-centric business model to a solution-centric
model in order to stay competitive in today’s market.
Software Licensing and Entitlement Management Solutions
for a Connected World
Software and applications are fundamental to Internet of Things
solutions and software licensing and entitlement management
are foundational to a software business. Software licensing
enables manufacturers to create new revenue streams and
protect intellectual property by implementing and enforcing
licensing models within your software/apps and enabling
electronic control of device capacities and capabilities.
Entitlement management runs the critical back-office operations
of a software business by tracking what software each customer
is entitled to and recording the evolution of their entitlements
through the software lifecycle. Entitlement management
provides an accurate view of customer software entitlements
which enables the device manufacturer to capitalize on
up-sell opportunities and ensure customers are always using
the most up-to-date software and firmware. It enables device
manufacturers to proactively send software/firmware updates
and patches quickly and easily to prevent security issues. It also
provides the capability to electronically configure new capacity
to meet customer demands, reduce inventory, and bring new
products to market faster.
Software licensing and entitlement management are key
enabling technologies that empower device manufacturers
to transform their businesses and build a sustainable digital
supply chain ecosystem. Using software as a differentiator,
and monetizing it, device manufacturers are able to transform
from a traditional provider of hardware to a strategic
solution provider.
Reduce Risk and Vulnerability Surrounding Internet-
Connected Devices with Software and Firmware Updates
Another key requirement in establishing a digital supply chain
ecosystem is security. With internet connected devices there
will always be a risk from determined hackers that want to
exploit vulnerabilities in the devices and the applications
on the device. Enterprises fear exposing their customers to
internet criminals without a means to fix the problem, and
they also fear potential repercussions due to regulatory
non-compliance.
Device manufacturers can alleviate some of these security
concerns by using tamper resistant software licensing to protect
against abuse and ensuring only authorized users have access
to and are using device applications. In addition, they can
proactively monitor devices for application issues and if an
issue is uncovered quickly send out updates with an automated
software update solution. The right update and entitlement
management solution will provide secure downloads of
software, bug fixes and security patches directly to the device
or software application – ensuring the customer is running the
latest software.
Flexera Software’s FlexNet Producer Suite for Intelligent Device
Manufacturers empowers device manufacturers to create a
digital supply chain ecosystem that monetizes the Internet
of Things. It enables device manufacturers to unlock new
and recurring revenue streams, protect intellectual property
and implement configure-to-order manufacturing processes
that dramatically reduce inventory while enabling greater
responsiveness to changing market conditions. It delivers
back-office entitlement management technology to streamline
fulfillment, protect maintenance revenues, implement new
revenue models quickly and establish direct relationships
with customers through multiple tiers of distribution. The
FlexNet Producer Suite is an end-to-end licensing, entitlement
management and software delivery and update solution
that drives recurring revenue streams and helps reduce cost
and complexities.
Licensing
FlexNet Licensing empowers intelligent device manufacturers to
monetize and protect the IP that is at the core of the Internet of
Things. Licensing enables manufacturers to increase revenues
by easily facilitating new pricing, packaging and licensing
models. It supports the full software licensing spectrum, from
strict enforcement to usage-based trust but verify and enables
software protection, monetization and compliance of SaaS,
cloud, virtualized, on-premises and embedded applications.
FlexNet Licensing is based on market leading FlexNet Publisher
and FlexNet Embedded, used by over 3,000 application
producers in over 20,000 applications.
Entitlement Management
FlexNet Operations gives device manufacturers the power
to manage devices, software licenses and entitlements easily
and efficiently. It automates the generation, fulfillment and
activation of devices, software and entitlements to enable
the manufacturer to cut costs. It offers a holistic, 24x7, self-
service Web portal for manufacturers, customers and channel
partners to provide an excellent customer experience. It supports
the movement towards usage-based trust-but-verify software

4. Flexera Software LLC
(Global Headquarters):
+1 800-809-5659
United Kingdom (Europe,
Middle East Headquarters):
+44 870-871-1111
+44 870-873-6300
Australia (Asia,
Pacific Headquarters):
+61 3-9895-2000
Beijing, China:
+86 10-6510-1566
For more office locations visit:
www.flexerasoftware.com
Copyright © 2014 Flexera Software LLC. All other brand and product names mentioned herein may be the trademarks and registered trademarks of their respective owners.
FPS-IDM_DS_Apr14
FlexNet Producer Suite for Intelligent Device Manufacturers
licensing and compliance models by providing visibility into
actual usage to support compliance initiatives. Lastly, it enables
electronic software delivery of applications to devices.
Software Updating, Device Monitoring and Insights
FlexNet Connect keeps costs down by connecting manufacturers
to users. It electronically delivers application updates (firmware
and software), monitors device for application issues and sends
messages directly to devices while at the same time providing
deep customer insight into the installed base.
Global Consulting Services
Flexera Software Professional Services enables intelligent device
manufacturers to accelerate and increase the value manufacturers
receive from Flexera Software solutions. Our experts average more
than ten years’ experience in business transformation initiatives
including the move from a traditional provider of hardware
to a strategic solution provider, including new licensing and
pricing business models, entitlement lifecycle, licensing lifecycle,
monetization, installation and electronic software delivery and
updates. Through subject matter expertise, best practice and a
proven methodology, we can help you implement and evaluate
current or potential strategies to achieve your business objectives.
About Flexera Software
Flexera Software is the leading provider of strategic solutions for
Application Usage Management; solutions delivering continuous
license compliance, optimized usage and maximized value
to application producers and enterprises. Flexera Software
is trusted by more than 80,000 customers that depend on
our comprehensive solutions - from installation and licensing,
entitlement and compliance management to application
readiness and software license optimization - to strategically
manage application usage and achieve breakthrough
results realized only through the systems-level approach
we provide. For more information, please go to:
www.flexerasoftware.com
Enterprise
Resource Planning
Customer
Relationship
Management
Product Lifecycle
Management
Business
Intelligence
Ecommerce Subscription Billing
Renewals
Management
Entitlement
Management
Licensing
Electronic
Delivery
Internet of Things
Applications