OpenLM Blog

Users of AutoCAD are found in a diversity of industries from consumer products like golf clubs to oil and gas plant and piping design and drilling platforms. This useful and versatile software does not come cheap, with individual licenses starting at $1575. While there are small businesses who rely on AutoCAD and only need one or two licenses, larger companies need many licenses for their large drawing offices and multiple projects. In such cases, it is impossible to manage license management effectively using manual procedures and spreadsheets. Most AutoDesk implementations come with  license manager Flexera, the most widely used solution in this arena. It is designed to control allocation of licenses, monitor license compliance, which is useful for any company that does not want to fall foul of a license audit, but even more useful for AutoDesk, who needs to keep a watchful eye on how their licenses are being used, especially where a concurrent license agreement has been chosen with the Token-Flex agreement.

Managing Multiple Users on a Network

A network license is a concurrent license that can be used by any user with access rights, and is an efficient way of minimizing the number of licenses in the inventory while catering for a large group of users. Some companies achieve a ratio of three users per license or even better. For this licensing option the license management software is loaded on to one or more network license servers and can be used by the license administrator to grant, manage and remove access rights to the company’s users.  The AutoDesk license manager also gathers statistics on usage for billing purposes and does help to a certain extent with managing productive license usage. However, if something more advanced than a “License Manager 101” is required, it is advisable to invest in additional license manager software that was written for the customer, rather than the vendor. This is where OpenLM comes into play: it is written specifically to make license management and administration easier and more productive from the customer’s perspective and provide valuable insight to license usage in the organization.

Why OpenLM is a Really Good Investment

OpenLM is a license management tool designed specifically for the engineering sector, but is also used in manufacturing and construction, and any other environment where engineering software is part of the user toolset. It operates in real-time and can be used to monitor many of the most widely used engineering software products on a per-minute or even a per-second basis.  Some of the capabilities of OpenLM include:-

• The ability to detect idle licenses and “harvest” them (disconnect the user’s access and free the license back into the license pool for another user to access).
• A feature that enables the license administrator to maintain the FlexLM Options file directly from OpenLM without having to access AutoDesk’s license manager, for functions such as the granting or revoking of access rights.
• Flexible and in-depth reporting, notably the usage of AutoDesk tokens and where they are costing more because of the AutoDesk time-slot management and pricing model.
• Special extensions that offer even more value-add, such as a newly introduced reporting add-on that allows you to create custom reports using any of the data that OpenLM can extract.

A Cost-Effective and Easy-to-Use Solution

OpenLM can be installed for a free evaluation by anyone interested in an effective license management solution. During the trial evaluation period, most customers are impressed with its easy to use interface, and find they do not need much assistance in getting up and running. The ability to manage, not just AutoCAD, but other engineering licenses, such as Catia, Solidworks and ArcGIS, through a single product cannot be overemphasized. No longer does the license administrator need to remember the quirks of every license manager software supplied by their vendor (such as Sentinel RMS or IBM LUM).  And, it’s competitive pricing adds a sizeable weight to the ROI.

For an organization that is heavily invested in AutoCAD, all the facts needed to maximize productivity are at your fingertips, simultaneously minimizing licensing costs while maximizing availability for your concurrent users. Get more detail about AutoDesk and OpenLM.

Did you ever need to report license usage by group? Many license administrators want this capability for a variety of different reasons, among them chargeback – to help the organization charge the appropriate department or project according to usage, and allocation – to help them decide whether certain groups should be given preference over others.

Using the OpenLM Group Usage extension gives you that capability. You can synchronize with MS Active Directory entities such as organizational units, or build groups of your own.

In the OpenLM License Usage report, you can clearly view usage of different groups each represented by a different colored line on the chart, done by checking the checkbox labeled “Display separate chart lines for each group”

You can display any combination of groups by marking those required in the filter, as shown above.

See it demo’d in the next live OpenLM Extensions webinar.

 

Named and Node-Locked Licenses (Fixed)

Traditional software licensing was simple; a license was obtained for each user, and there was a fixed license charge, which could be discounted if there was a large user base. This license model is still available today, but it is not very efficient, because only one person has access to the software, and it lies idle when they are not using it. In recognition of the limited utilization, these licenses are cheaper than multi-use licenses. They can be tied to a specific user or a specific workstation.

“Hard” Licenses

This license is still popular among engineering vendors. The license is managed via a USB key or dongle. Access to the software is via the device. This does allow sharing, because plugging the key into one’s laptop allows access, and the vendors are keen to point out that offline access is available via this method. However, lose or damage the key at your peril; you will have to purchase another license. Some vendors recommend that you get insurance equivalent to the license value to mitigate this risk. Vendors who use this form of licensing tend to supply very specialized engineering software that only a few users at a company will need, and it can be the best option where the work is done at remote sites with no online or internet access.

Concurrent Licensing

Large customers who required hundreds of fixed software licenses or a site license pushed vendors to come up with a more flexible, multi-user option, and this has come to be known as concurrent licensing, floating licensing or network licensing. Concurrent licensing offers the customer the best option when it comes to licensing efficiency. The license caters for a maximum number of concurrent users at any one time. In a concurrent environment, if all the licenses are booked out, the next user to try and “pull” a license from the licensing “pool” will be denied access until a license is freed. This license model requires skilful management to balance between the number of licenses purchased and the maximum number of users at peak times. The concurrent license costs more than the named or single-user license, but a good administrator can achieve a 3:1 ratio or better on users to licenses.

Vendors have been trying to discontinue concurrent licensing with very mixed results. Esri had to backtrack on their initiative when their ArcGIS user community pushed back (A very good reason to join user groups). Autodesk are also having less than spectacular results with token licenses.

“Pay-as-you-Go” or Token Licenses

This is a new addition to the batch of software license types. While the concept of paying as you use a product initially makes some sense, it has not been well received by customers. In comparison to the floating license model, rather than limiting concurrent usage, the user organization is free to use the software without limits, instead spending tokens for each use. Autodesk has recently introduced this model, and the benefit is that all Autodesk products are available under this software license type. Unfortunately they have made it complex  and difficult to understand by pricing usage differently depending on the software chosen; for instance Revit MEP uses more tokens than AutoCAD. There is also a time-of-day factor that can result in relatively high charges. One of the main hurdles users need to overcome with this model is effective forecasting and budgeting . Forecasting is difficult enough with concurrent and fixed licenses, so how many tokens are needed for next year is very difficult to estimate.

For more on the Autodesk model and how it works, please refer to this blog post on the subject.

How do Vendors Track License Usage?

Knowing how and when licenses are being used requires vendors to provide license control software, although some vendors do not even provide this feature. This has created a software niche of companies who provide license tracking applications, of which the most widely used is Flexera. The license control software is loaded on to a special license server or server cluster and it performs asset tracking and license access from there. While the software does assist the license administrator to some extent by providing a vehicle to grant access rights, its primary purpose is to restrict access according to license package purchased and to collect software usage data on behalf of the vendor.

The  administration of licenses is made more complex because there are different license control applications used by the vendors, each with their own rules and reporting, although most of them use FLEXlm from Flexera. To give you an idea of the challenge; here are some vendors and the license control software they use.

• Autodesk       Flexera Flexlm
• Bentley          Own product
• Dassault        Dassault’s own manager for products such as CATIA
• Deltacad        Reprise License Manager
• InterGraph   Intergraph SPLM

The license administrator is faced with the challenge of managing each vendor’s toolsets individually, with no overarching view of his license landscape.

How Can YOU Manage YOUR Licenses?

In an engineering environment, there are far too many software applications (with or without vendor-supplied license management software) to manage effectively and produce reporting that will satisfy the CIO and CFO. Fortunately, there is another niche of license management software that monitors and even manages licenses from the customer’s viewpoint. This software is written expressly to help the license administrator get the best out of his portfolio. OpenLM is one of the companies that has focused on the varied and complex engineering software market, and has solutions tailored to make any license administrator’s life easier by offering:-

• the ability to gauge license utilization and efficiency with a common application that provides one form of user interface and reporting across products and vendors.
• Tracking of utilization per second on a large range of the most commonly used engineering software products, such as AutoCAD and ArcGIS and per minute on others.
• Managing access in addition to that of the vendor’s license manager
• The ability to “harvest” unused licenses for some software products, and release them back into the pool.
• Comprehensive reporting that can be used to audit the vendor’s asset tracking and license control report
• Extensions that allow the administrator to perform analytics on the license data, set time of day restrictions, notify users when a license becomes available and other useful activities.

You can evaluate OpenLM for 30-days without commitment. All the extensions – add-ons that provide enhanced functionality – are included in the evaluation.

After a short time, you will see the true value of visibility over your floating licenses. You will see that OpenLM is more than a useful application; it is value for money and brings you a quick return on your investment.

See more. Sign up for a live webinar

 

Did you know that OpenLM can let you control software license usage by conditions that even many license managers don’t know how to handle?

For example, one of the features of OpenLM’s most recent extension – App Manager – is to permit or deny use of the app according to time of day.  Another condition you can set is to restrict the user to only certain versions of the application. First you need to set up the condition. Below you can see how simple this is. In the condition editor window, you select the argument type time, set operation to ‘after’ and value to 10:00.

Next you set up the rule – a new rule called ‘Deny USA after 10:00’. The condition we defined above is marked as well as another condition that had been defined previously – ‘groups include USA’. Finally an action of ‘Deny’ is specified for the rule. See below.

Another possible condition you can include in the rule is the version of the software,  defined below.

An example of a rule using this condition is shown below. In this case it is used in conjunction with another condition ‘application’ and an action of ‘Allow’ is marked as shown below.

The result of implementing a rule is that when a user tries to launch an application, if it doesn’t match the rules the app will not start and a message similar to the one below is displayed.

The OpenLM App Manager is now being offered free including support for one year to all OpenLM customers with a valid maintenance agreement for OpenLM Pro, Enterprise or Site License configurations. https://www.openlm.com/openlm-app-manager/

 

Every engineer knows how important it is to have just the right tools to do the job. In modern engineering, many of these specialized tools are software products. This is no different for the CAD manager; his basic toolset includes license management software provided by the CAD vendor. This software is installed on CAD license servers and is used to grant and remove access and to monitor usage of the software. Most companies invest in concurrent licenses because of the high cost of licensing, creating a scenario where only one license is required for 3 or even more users. The CAD manager’s job is to ensure availability and a minimum of denials from the licenses available in the CAD license pool.

A Tool that really Gets to Grips with License Management

While the vendor-supplied license manager software assists in this process, the ideal software can make the CAD manager’s life much less stressful. License management software like OpenLM is specially designed to facilitate engineering license management. It enables the license manager to monitor and manage licenses for a whole range of software, not just the one product, as well as offering features that the vendor license management falls short on, such as license harvesting.

Improving License Utilization

Using OpenLM, the CAD manager can identify idle licenses that have been booked out and release them back into the pool. Where there is a mix of named and concurrent licenses, sometimes referred to as a “hybrid” model, the admin can ensure that the named licenses are being used productively and that named users are not drawing concurrent licenses, thus locking out 2 licenses (this is a licensing anomaly that happens with some products, and is not deliberate on the user’s part). Where denials of service do occur, the stress of having frustrated engineers complaining that they need a license is reduced with the OpenLM Agent, which alerts the user as soon as a license becomes available. This also helps the user, because he does not have to make repeated efforts to pull a license and can get on with something else until the system notifies him.

Reporting that Gives the Whole Story

While the license manager software provided by the vendor measures usage and costs of use, which is relevant where tokens are used, it is comforting to have another objective view of costs and usage which often has conflicting views of actual use. This can be used in discussion with the vendor’s account manager. Enhanced reporting on license utilization also provides evidence to take to management for situations where additional concurrent licenses are needed. Surplus licenses are easily identified and can be discussed with the vendor, either being swapped for concurrent licenses where the licenses in question are single user or discontinued altogether, resulting in cost savings in both instances. There are other monitoring aids, like an in-depth view of denials of service that helps identify whether the shortage needs to be managed or whether they can be ignored, because the user obtained a license shortly after the denial.

Simplifying Complexity with a Single View

Many engineering organizations have complex and scattered CAD setups; this can happen because of geographical constraints for a particular product, where regional licenses are required, or projects have their own licenses for the life of the project. Mergers and acquisitions and company history also create complexity, because there could be several CAD tools in the company portfolio, not just a single product. OpenLM allows the CAD manager to manage all the different tools and different pools and get a single overall view of the licensing landscape. This aids in rationalizing the product mix and consolidating license pools where possible, making for a more efficient and productive CAD/CAM/CAE environment. For more on this subject, please visit https://www.openlm.com/cad-manager-tools/

 

Did you know that the OpenLM Reporting Hub extension allows you to use formulas on different columns to get exactly what you need? Functions include value calculations, data aggregations, if-else conditions, data pivot and many more data analysis expressions (DAX). See Microsoft’s DAX examples.

Here’s a Use Case:

The license administrator wants to see if the company’s license inventory matches its real needs. He knows there is a variance in demand for licenses throughout the year, due to seasonal trends and changes in project timetables. He would like to maintain a license inventory equivalent to the single highest daily usage over the previous year for every feature. However, he doesn’t have this information in the standard set of reports provided with OpenLM.

In the OpenLM Reporting Hub, he has the highest daily concurrent usage (max_concurrent_usage) for each feature, from the max concurrent usage table and has the daily license quantity (max_license_quantity) for each feature, from the license quantity table. From these he can calculate the feature usage per day and then take the highest value, using the formula below.

Max Level = 100*Max(‘externalschema daily_concurrent_measure’ [max_concurrent_usage]) / (MAX (‘externalschema daily_quantity_measure’ [max_license_quantity]))

Want to learn more? Get a private 20-minute live session on the power of the OpenLM Reporting Hub.

Introduction

There are situations where a license administrator may decide to reserve one or more concurrent licenses for a specific user or group of users. Reserving a license is a significant action and should not be done unless strictly necessary. By changing a license to ‘reserved’, the license administrator takes an expensive, floating license and converts it to a less expensive and less valuable node-locked license. Locking a license as ‘reserved’ blocks it so that only the designated user(s) have access to it.

Utilization of reserved license designations should be done with care because of this limitation. Each minute that a reserved license is not in use is time where it could have been utilized by other users in the network.

The identification of whether reserved licenses are being used satisfactorily can be done using OpenLM. This needs some understanding of how FLEXlm reports on reservations. There is a differentiation between licenses that are lying idle and those that are in use, and the important metric is licenses that have been reserved but are not in use.

FLEXlm License reservation is allocated in the Options File; this is where the license administrator isolates licenses for a user or a group.

How FLEXlm Displays Reserved Licenses

The FLEXlm license reservations (for users or groups) declared in the Options File displays the following allocation when out of 5 licenses in the inventory, 1 is reserved for user rachel and none are in use:

Users of Viewer:  (Total of 5 licenses issued;  Total of 1 license in use)

 “Viewer” v10.1, vendor: ARCGIS

 floating license

       1 RESERVATION for USER rachel (10.0.0.145/710)

As can be seen, a reserved license is shown by FLEXlm as in use even when no one is using it.

 

When the reserved license is in use, the status is unchanged except for the reserved license detail line being replaced by the session details:

Users of Viewer:  (Total of 5 licenses issued;  Total of 1 license in use)

 “Viewer” v10.1, vendor: ARCGIS

 floating license

    rachel DELL x(<C;tQ%e;S (v10.1) (10.0.0.145/710 102), start Fri 12/25 11:40

When the session is closed, the status returns to that of the previous example.

Licenses can be reserved according to user, group, host, host group, IP address, display or project. Details about group or host-group members can only be seen in the Options File: details of groups do not appear on the license output.

FLEXlm Reservations in OpenLM

From version 4, OpenLM lets you view licenses in use either according to actual utilization or considering all reserved licenses as in use (the FLEXlm way). With actual utilization, the number of available licenses decreases only when a reserved license is allocated.

When a license is Reserved but not in use, OpenLM Server records a session (defined as a “reserved session”) with a dedicated username (defined as a “reserving user”) in the following format for user rachel:

FLEXlm_Reserved_<Entity Type>_<Entity Name>. E.g. – FLEXlm_Reserved_U_rachel

Entity Name denotes a user, group, host, host group, ip address, display or project and would have one of the following values:

“U” for user

“G” for group

“H” for host

“HG” for host group

“D” for display

“I” for internet

“P” for project

Because the reserved license is not available to users outside of its specified group or user, it is not fully utilized unless the user or group consumes the license 100% of the time, in which case no ‘sessions of reserved sessions’ are shown in the system. The significance of  ‘sessions of reserved sessions’ is that the reserved license is allocated but lying idle.

A more accurate picture of license allocation can be achieved using the OpenLM License Usage report with a filter of the “reserving user” name. If the report shows reserved sessions to be constantly higher than 1 (i.e. reserved licenses not in use), it means that license administrator can decrease the number of reserved licenses for that entity and thereby free up licenses for the benefit of all other users.

A Real Life Example

Let’s consider the following example:

A small company has 5 concurrent licenses of Viewer. The company has many users (more than 5) that need to use this license but it is absolutely imperative that the engineers will have a free license when they need it.

So the License Administrator decides to reserve some Viewer licenses for the engineers and adds the following lines to the Options File:

GROUP engineers natal efrat rachel chen richard

RESERVE 2 Viewer GROUP engineers

Now there are always 2 Viewer licenses reserved for the engineers group.

Let’s say a month goes by and the License Administrator uses the OpenLM “License Usage” report for Viewer.

Option A – No denials from the non-reserved licenses

In this scenario, during the the elapsed month, number of used licenses never reached the maximum of 5, and even if it did, no usage beyond that number was needed.

In other words, every user that ever needed a license always got it. In this case the license administrator should do nothing but when maintenance renewal is due, he should produce this chart again and recheck the situation.

Option B – Denials received when trying to pull non-reserved licenses

In this scenario, during the elapsed month, the number of used licenses reached the maximum of 5 and the OpenLM denials report shows there were users (engineers and others) that were denied licenses when they needed them:

Now you need to investigate and drill down into the data.

OpenLM displays a virtual user for reserved licenses, the name being constructed from the group name – in this case FLEXlm_Reserved_G_engineers. This user is ‘in use’ whenever reserved licenses are NOT consumed.

The Administrator can now filter the same License Usage report by this user and analyze the results:

If no usage at all is seen for that user, it means that the reservation was fully utilized – i.e. there was always a user of the engineers group that used it. If however, there are denials too, this indicates that the capacity of the concurrent licenses to satisfy the users’ needs may have reached its limit and the purchase of additional licenses should be considered. Users could also be booking out a reserved license and not releasing it when finished.

 

On the other hand, it is possible that there is usage for that user and it is continuous and not fragmented:

Where the ‘reserved usage’ is always 1 or more, there was one reserved license that was lying idle and unused by the group of engineers, while other users who could have used it were denied licenses. Here the license administrator should consider reducing the number of reserved licenses for the engineers group.

Another option is that the reserved user does not have any (or has minimal) usage during the stated period:

 

This, combined with OpenLM denials report, may suggest that the engineers don’t get enough licenses. Here the License Administrator may consider increasing the number of reserved licenses for the engineers or even replacing their concurrent expensive licenses with single use/named licenses.

Summary

Reserved licenses are floating (concurrent) licenses that are inaccessible to all but a select user or group of users. It is very important to monitor the utilization of this privilege to ensure that it is still required and is not being abused. OpenLM gives its users the tools to do just that.

From version 4.1 OpenLM allows license administrators to filter reserved licenses from the License Usage report so that the report can be viewed in two modes: the total number of licenses consumed overall including reserved licenses, or the total number of actual consumed reserved licenses.

 

Today, 4 main modules of OpenLM are released under the version 4.1 title. Major enhancements include:

• Running of agent procedures on OpenLM Agent and on Agent SoftwareLocker Service
• Running of custom scripts on OpenLM Broker and on OpenLM Server
• RMS license server reporting more accurate and complete
• Filtering of  denials collection with predefined configuration
• LDAP synchronization is faster and has new reset sync functionality
• Reports run faster
• Inclusion / exclusion of unconsumed reservations in the License Usage Report

And of course, a bunch of bug fixes

For all the details, see OpenLM Software Revisions.

While companies globally are trying to transform into the new way of working, with flattened organizational hierarchies and agile teams, one of the challenges they face is the importance of status symbols to their employees. We are all familiar with the manifestations of how high up the totem pole one has ascended. They range from small items like an upgraded chair, table or better laptop to more expensive and valuable ones like the corner office with windows, company car and a parking spot near the entrance. Certain jobs demand specific perks, like golf club membership for marketing and sales executives.

When it comes to the engineering sector, there is an interesting variant: the dedicated software license. Chief engineers, long-serving draughtsmen and even engineering executives may well have their own ‘personal’ copy of one or more very expensive software application. Whether they make extensive use of the software is not open to debate, it is a very costly recognition of their value to the firm. It also makes the license administrator’s work just that bit harder, as he has to manage these assets in addition to the licenses owned under a concurrent licensing agreement.

The Cost to the Company

Concurrent or floating licensing is an efficient way of containing costs where there are many users of a specific product. When the license agreement is entered into, the aim is to buy the minimum number of licenses for the maximum number of users, taking into account peak usage, company growth and expected projects in the pipeline. This is not a simple balancing act; no user should be denied service because all the licenses are booked out; but there should also not be too much spare capacity or “shelfware”.

Contrast this with a dedicated license, which adds an overhead to the license management portfolio, because its expiry date is probably not in sync with the concurrent license contract, although it does come in at a lower cost. There is an alternative way of creating a dedicated license by taking it from the available concurrent licenses, either by borrowing or reserving it. Both of these options convert the concurrent license to a “node-locked” license. This means that for every borrowed or reserved license there is one less floating license available to the users of that software application, which could result in denial of service at peak times. From a cost aspect, this is like paying for a limousine and getting a family car. The reservation or borrowing could have been a temporary remedy which became permanent because the dedicated software was not returned to the concurrent license pool at the end of the designated period.

If the lucky recipient of this reserved or borrowed license makes full use of the software, there is less of an issue. However, if there is anything less than continuous use, the full benefit of the license is not being realized and this can amount to an additional cost to the company, because the reduced number of concurrent licenses could be too low to prevent denials of service. When users are locked out because of a license shortage, this causes frustration and loss of productivity, which carries its own costs; it can result in purchases of additional licenses to satisfy demand, if the poor utilization of reserved licenses is overlooked.

Companies that have paid attention to this problem have saved up to $1 million per year by monitoring the use of all forms of dedicated licenses and removing the rights where the software asset is not being utilized sufficiently. We will discuss the ramifications of reserving and booking out concurrent licenses in another article, but they can have a material impact on software licensing costs.

Status Symbol or Essential Tool?

But not  all dedicated licenses are mere displays of rank and status, some engineers genuinely need almost uninterrupted access to specific toolsets, for instance the transmission and distribution engineers who design lines for the power utilities, or the engineers who deal with piping and instrumentation diagrams (P&ID) in oil and gas plants. You must first define sufficient use to justify a dedicated license, and then monitor and measure usage.

Designing Parameters for Dedicated Usage

Engineering software that is used continuously and widely within organizations, like computer-aided engineering (CAE) and project management applications, are especially suitable for “floating” licenses. However, there are certain classes of software where there will be periods of extensive use alternating with periods of complete dormancy, such as lightning shielding applications and other  specialized applications that are used by experts in their field. In this case, it is better to buy a few individual licenses for those specialists; 100% usage of these products will never be achieved, but they are essential for those niche jobs.

When it comes to products where a concurrent license is justified, a set of rules or guidelines justifying a dedicated license can be drawn up, based on number of hours per day, per week or per month or project priority. Depending on how formal you want to make it, this could be used for a policy document. The parameters for use should be based on historic usage values extracted from your asset or license management software. These parameters are not cast in concrete and should be revised periodically. There will undoubtedly be mutterings about any such policy or guideline, but if it is issued company-wide it is seen to be objective and not a personal attack. It should also be made clear that usage will be monitored.

Measuring and Monitoring

We discussed this in an earlier post – Getting the most from your concurrent licenses, as it is important to distinguish between reserved licenses that are idle and reserved licenses that are being used. We also explain how to interpret the reporting on reserved licenses and what actions need to be taken. The reporting output can be used to explain diplomatically to an engineer that has a dedicated license but is not making much use of it, why the license should be brought back into the concurrent license group. To pacify aggrieved feelings, have an alternative perk available, such as a personal cappuccino machine, or a serious laptop upgrade.

Going Forward

Working through all the concurrent licensing software on board will take time, some companies have several hundred engineering applications in their portfolio. It makes sense to deal with the most widely used and most expensive applications first. It is also important to keep a watching brief on future usage – the last thing you need is an irate chief engineer saying “I told you so!”, because he got a denial of access to “his” software .

 

Learn more about OpenLM solutions for software license management www.openlm.com

 

A year ago, ESRI caused quite a bit of consternation among their customers by changing their licensing model. Engineering software licenses are notoriously expensive, and Esri’s ArcGIS license is no exception. Most engineering companies invest in concurrent use licenses, as this is generally the most cost-effective and efficient license model. Esri announced that their new product, ArcGIS Pro, would be sold with single-use or named-use licenses from the beginning of 2017 and concurrent use licenses were to be phased out. Unfortunately this announcement was made very shortly before the end of 2016, leaving ArcGIS license owners with very little time to understand the implications or react to the change. We wrote about the change earlier in 2017, in some detail in this post.

How the ArcGIS Product Line is Changing

In order to move to a 64-bit architecture, Esri is phasing out ArcMAP, the GIS workhorse of the suite, and replacing it with ArcGIS Pro, which is available within ArcGIS Desktop and can be used if the customer has a maintenance agreement with Esri. The challenge was that ArcGIS Pro’s default license was a named user license, and it seemed obvious that Esri was trying to phase out concurrent licenses. Although we will never know for sure, it is likely that many existing customers were resisting the upgrade to ArcGIS Desktop 10.5, the version that was closing the door on concurrent licensing. The previous version, ArcGIS 10.4, will only be available for purchase until the end of January 2018, which means that customers are now forced to make a decision about their future with ArcGIS.

The Economics of the Named Use License versus Concurrent Use License

The license is a material contributor to the ArcGIS software cost, and CIOs and the license administrators who report to them ensure the best bang for their buck via concurrent user licenses, aiming for a ratio of 3 users per license or better.  The best ArcGIS license option for any organization is the concurrent license, and it did not matter what sweeteners Esri offered, such as a 3-for-1 license swap, the customers were not taking the bait. It seemed an impasse had been reached, but Esri finally started listening to their customers.

The Power of the Crowd

ESRI’s ArcGIS license owners have a vibrant and active community of user groups, both in the US and global chapters in countries throughout Europe and the Middle East to Asia Pacific. There are location-based groups and SIGs (special interest groups), such as water management and local government. Esri also encourages the creation of groups for collaboration as an integral part of their software. Regular user group events are held, both in the US and globally, and this is where customers voiced their feelings about the new licensing model.

Esri had always prided themselves on being a customer oriented company, but their strategy to move to named user licenses was definitely not a good customer experience, and their customers were letting them know. They did some introspection and then issued the following message to all their customers:-

http://go.esri.com/webmail/82202/506282798/71e698a576fe01985a73839d07b76f80

In this announcement they stated: “We are extending the availability of Concurrent Use licensing for ArcGIS Desktop (ArcGIS Pro and ArcMap) to all of our customers, new and existing. Your feedback has helped us better understand how Concurrent Use licensing provides you with the flexibility to deploy ArcGIS Desktop in a way that best fits your workflows.”

Restoring the Preferred ArcGIS License Model

This change takes effect from 1 January 2018 and brings back a flexible license model that can be tailored to fit any company’s requirements, but will help to rebuild the relationship between Esri and its customers. The enterprise that uses ArcGIS for their mapping will be able to optimise their licensing model through concurrent use, a licensing model that is best suited to managing and monitoring license use for the foreseeable future.