by John Stucky
Today I am talking about cloud-based solutions versus on-premise solutions. I am covering a detail between the two that is often overlooked but can have a HUGE impact on your total cost. That detail is NAMED vs CONCURRENT user licensing. If you are considering new software and trying to compare the pros and cons of cloud versus other options, then stay tuned…
There are many factors to consider when making this decision. And, despite what some vendors may say, the answer is not the same for everyone! It is important to understand the difference between NAMED and CONCURRENT users.
The price of software is often based on the number of users who will be using it. How you count those users will depend on whether the software counts NAMED or CONCURRENT users.
Most cloud-based solutions that charge you a price per user per month (also known as SaaS or pay-as-you-go) charge based on NAMED users. A named user is any person who may use the application at any time. If you have 100 people in your organization and they all need access to the software – even though not at the same time – then you need 100 named users.
CONCURRENT users only count the total number of users who are CONNECTED at the same time. So if your organization has 100 people who need the software but not all at the same time, you may only license 60 concurrent users. This means that all 100 users will be setup and have access but only 60 can connect at the same time.
CONCURRENT users can be harder to estimate and count, but they can provide BIG savings on the cost of your software. Instead of buying it for 100 users you are buying it for 60!
This factor has a very big impact on the total cost of your solution. Be sure you understand the licensing model your vendor offers and compare it to solutions that offer you flexibility in that licensing model and in the deployment models. Some software even allows you to license concurrent users and deploy in the cloud! This is a huge advantage when comparing options.
So when you are considering new software and are trying to decide between cloud, hosted or on-premise options, be sure you know the difference between the LICENSING model - is it based on NAMED users or CONCURRENT?
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