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Software asset management (SAM), as organizations such as ITIL and ISO define it, is obsolete. Its base processes come from a bygone era of floppy disks and unique license keys, whereas today's software licensing challenges include virtualized systems, a focus on usage instead of installation, and a proliferation of pricing metrics to track and control. This report will introduce a new approach that Forrester calls software license optimization (SLO). It will explain how traditional SAM is failing enterprises and how SLO is enhancing compliance while reducing wasteful spend on superfluous license capacity.

Managing software entitlement and license compliance continues to pose a challenge to asset managers. Given the sheer number of vendors that a company might do business with and the myriad ways the applications are licensed, it is no wonder that organizations struggle to deal with this problem.

In today's economic climate, there is significant pressure on CIOs to control costs and reduce risks, while at the same time finding ways to fund new business initiatives. Software represents a strategic asset that is typically under-managed in most organizations. Hence, it should be a priority for CIOs to find ways to automate and optimize software asset management to uncover cost savings and minimize license liability risk. The recovered time and money can then be diverted to innovation.

Ovum has long advocated the need to manage software contracts and software license compliance/costs on a professional basis, beyond the Excel spreadsheets used by most IT departments. FlexNet Manager Suite for Enterprises represents an enterprise-class solution for desktop and datacenter software assets and provides the information and tools needed to optimize the management of these assets.

There is a high rate of stickiness for license management solutions among customers, because they are integrated at many levels into (independent software vendors) businesses and their applications. Winning market share against dominant competitors is challenging because of this factor. It is further challenged by the dominance of hardware dongles in the License Management market. While software-enforced license management offers clear advantages in terms of flexibility and lower cost, it is perceived to be more vulnerable to hacking.

This report, prepared by IDC, shows how increasingly, software licensing is helping manufacturers generate value from embedded software by providing an additional, high-margin revenue stream, protecting intellectual property (IP) from misuse, simplifying product packaging while allowing for more flexible configurations and lowering inventory costs by decreasing the number of SKUs needed to satisfy unique customer demands.

The proliferation of embedded firmware, software and applications in devices and equipment enhances product functionality, process flexibility and customer satisfaction, resulting in higher levels of demand-driven maturity. Designing an end-to-end value chain strategy for embedded software is typically not well-integrated across functions, nor do companies always maximize the opportunities that are possible. Gartner provides an overview of embedded software (ES) capabilities, business case considerations, organizational requirements and trends by industry.