The Four Ways Vendors Make Money From Cloud Computing
September 13, 2013
Grazed from Forbes. Author: Joe McKendrick.
In times gone by, people and organizations paid IT vendors for something tangible — be it server boxes or software on a disk. Now with the cloud, IT is no longer a product, it is a service. And as with any kind of service, software has become an intangible that requires ongoing payments. There are a bunch of ways to pay for cloud or Software as a Service — and the industry seems to still be in search of the best formula for attracting and keeping customers.
But for now, cloud and SaaS vendors have settled on four basic models. Byron Deeter, partner with the venture capital firm Bessemer Venture Partners, recently co-authored a paper that reviewed the top pricing models, exploring how each model has evolved, and what’s in it for the customer:…
Freemium model: This business model seeks to lower barriers to entry for online offerings by offering some core services at no charge, then charging a premium if the customer wants to upgrade to something more sophisticated…
Read more from the source @ http://www.forbes.com/sites/joemckendrick/2013/09/12/the-four-ways-vendors-make-money-from-cloud-computing/