Subscriptions vs Perpetual Licenses: What's Right for You?
Everyone knows that change can be difficult. From minor things like always eating the same food to serious examples like staying at a bad job, our comfort zone makes it difficult to try new things – even when we know the change will be good for us in the long run.
The same is true in the software industry, where companies increasingly are replacing the one-time-purchase license for their product with cloud-based subscriptions. And while some customers might prefer buying a box and keeping the installation CD on the shelf, the benefits users gain from subscriptions are driving the subscription revolution. In fact, Gartner projects that 80% of current software developers will offer subscription-based options as soon as next year.
We thought we’d take a look at the differences between traditional one-time purchases (called perpetual licenses) and subscriptions, explaining the benefits of each. Then you can decide which approach fits your company’s needs when looking at a solution like Acronis Backup.
Perpetual licenses started because when commercially sold software first arrived, products were one-time purchases. At the time, computer hardware was a costly investment, so it was rarely upgraded. That meant there was no need to regularly upgrade software since the system a solution would run on would be used for a long time.
Since perpetual licenses involve a one-time payment to permanently purchase the software, that usually results in a larger up-front cost. The good news is that since that software will be used over the course of several years, companies classify the purchase of a perpetual license as a capital expenditure (CAPEX) so they can account for its depreciation over time.
Drawbacks of one-time purchases
While perpetual licenses are great for those who prefer the idea of “owning” their software instead of “renting” it through a subscription, there are some serious drawbacks given how data is used today.
The name “perpetual” hints at the first consideration – you’re making a long-term commitment to a solution. That might have been fine in the past, but considering how quickly IT needs change, data volumes increase, online threats evolve, and technologies advance, perpetually licensed software may not offer the flexibility you need.
That pace of change can also impact the solution itself. With a perpetual license for Acronis Backup, for example, you need to have an active maintenance plan to receive software updates and technical support. Without it, the solution may not provide adequate protection against the modern threats – but it means that in addition to the lump sum purchase price, the additional cost of maintenance can result in up to 40% more over three years.
Subscriptions can contain your costs
With the advent of the internet and the cloud, solutions like Acronis Backup can be offered on a subscription basis. While opting for a renewable subscription may not give you “ownership” of the license (which means you need an active subscription to use the software), it can deliver a lot of attractive benefits.
First, the upfront cost is less than a perpetual license. Plus, since a subscription to Acronis Backup automatically includes software updates and technical support, there’s no maintenance plan required. That can save you up to 30% during the first three years.
In addition, because subscriptions to Acronis Backup are pay-as-you-go (renewals are on a one-, two-, or three-year basis), your company benefits from greater flexibility and costs controls. You can easily scale up your storage when your business needs it, and then scale down again.
Finally, by protecting your company’s data and IT infrastructure via an annual subscription, your account team can change the investment from a capital expenditure to an operational expenditure (OPEX) – providing greater accuracy in budgeting and forecasting.
Up-to-date cyber protection
While the cost savings are definitely attractive, the real power of having the upgrades and support included in your subscription is the peace of mind you get knowing your company always has the most current protection for its data, apps, and systems.
Think about how quickly online threats are evolving, for example. Increasingly, cybercriminals have greater computing power and can create new strains of malware more quickly than before. With a subscription, the moment Acronis Active Protection is updated with new countermeasures against the latest cryptojacking attacks, your company’s resources are shielded.
There are additional protection benefits as well since there are certain cloud-based features that Acronis only makes available to subscription customers. Those features include:
- Acronis Backup Service, which delivers advanced data protection. With an Acronis Management Server running in the Acronis Cloud, you can ensure high data availability while eliminating the need to invest in hardware.
- Acronis Disaster Recovery, which performs an automatic fail-over of critical business applications to the Acronis Cloud, ensuring uptime with instant availability of critical workloads to maximize your company’s productivity.
- Cloud-to-cloud backups of Office 365 and G Suite, which allows you to automate the protection of your Microsoft Exchange Online, OneDrive for Business, and SharePoint Online.
At the end of the day, deciding which option is right for you depends entirely on your company’s needs and preferences. If you need to own the software you use and don’t need to have the latest protections (or you have the budget needed to absorb the additional maintenance costs), continuing with a perpetual license might work for you.
After considering the benefits, however, you’ll see why companies are increasingly choosing the cost-effectiveness, flexibility, enhanced protection, and cloud-based capabilities offered by a subscription to Acronis Backup.