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Limited Time Licenses

Hello,

I sell a business desktop app ($300-$450), and plan to offer a limited term (one-year) license at a fraction of the full product price. This might work well for my product - some companies need it for short term projects or are just uncomfortable paying "that much" at once.

Has anyone tried implementing this? Has it worked for you?

My questions:

1. Is it worth it to take extra steps to prevent customers from using the same license key when it expires? I am not a big fan of complicated protection schemes like online activation, and my app just stores the information in Windows registry without any encryption. This works well as long as they purchase the full version. Should I just use the same strategy for limited time licenses? I don't want customers to pay 20% of the product price and use the product for years by deleting some registry keys. Oh, or maybe that's not worth my attention?

2. What's the appropriate price for this license? I am considering 20-25% of the full product price.

3. Should I offer a fixed renew price guarantee? This might be tricky to maintain.

4. Anything else I am overlooking?

Thank you.
Anon
Sunday, December 23, 2007
 
 
See http://www.hash.com for a current example of this method.

Personally, I'd charge 50%, 33% at the lowest.
Tightwad
Sunday, December 23, 2007
 
 
Thanks for the link.

50% sounds way too much to me.
Anon
Sunday, December 23, 2007
 
 
I am thinking of doing this for a "student" version. That way I won't have to worry about collecting people's student IDs, etc..., any one can get a student version for cheap, it will only run for a year though.
Michael G
Sunday, December 23, 2007
 
 
"50% sounds way too much to me."

It's a B2B application, right? You don't want to make the cost too trivial or businesses won't think it's professional quality.

But I guess it depends on the application. How about making the Rental period shorter? 3 months for 20%?

Also see threads on what big business customers are allowed to purchase without jumping through paperwork hoops, that might influence your decision.
Tightwad
Monday, December 24, 2007
 
 
Also, don't mistake polite knockbacks for customer research - when a potential customer says "it's too expensive" or "I only need it for a few months" they might just be spinning you a line. Try making an under the table offer to such customers and see if they will actually pay up, before you go making it a standard policy.
Tightwad
Monday, December 24, 2007
 
 
***It's a B2B application, right? You don't want to make the cost too trivial or businesses won't think it's professional quality.***

You are right to a degree, low prices indicate low quality, but as the full (lifetime) license costs $450 (plus yearly upgrade fees), even $200 a year sounds a bit high if you compare the relative value.

***But I guess it depends on the application. How about making the Rental period shorter? 3 months for 20%?"***

Yes, probably playing with the period might make some sense.

Well, I don't want to list the low prices anyway, so maybe 33% a year is a good idea!
Anon
Monday, December 24, 2007
 
 

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