Hacker News new | ask | show | jobs
by magicalhippo 1674 days ago
Our software is subscription-based, and our customers love it. They get a predictable cost over time, rather than large costs every now and then. We can afford to include features that otherwise might not be justifiable in terms of new sales.

On the flip side, one of our competitors who hasn't switched has been struggling for years and a recent new version almost killed them off as many customers didn't feel they could justify the $10-20k or so to buy the license to the new version.

A key part of our success is that the subscription price scales linearly with customer activity. There's a fixed base price per active user, and in addition there's a cost associated with certain actions. This means that the subscription price scales with the customers activity and hence income. If they have a slow month they have less income but pay less, if they have an active month they have higher income but they also pay more.

FWIW our software is primarily installed on premise, but we do offer hosted service as well (base cost is different for the two cases).
1 comments
FpUser 1674 days ago
>"They get a predictable cost over time, rather than large costs every now and then."

For the software I buy one time price is often about the same as the annual subscription. With perpetual license however I often do not upgrade for years. So the perpetual licensing is a clear winner for me. I understand that SAAS can make sense for other customers but it is their choice not mine. I just simply do not buy software without perpetual license. It ruffles my feathers in a bad way.

Of course I am not talking about services where monthly payment is a natural state like Netflix.

link
magicalhippo 1674 days ago
> For the software I buy one time price is often about the same as the annual subscription.

That of course changes the balance. In our case the annual sum of the subscription is much less than that. More like 2-3 years before intersection, though I forget as we've had this system for over a decade now.

It should be noted that we're also in a segment where customers will need a new version now and then as rules and regulations change.

link