Consumption Pricing Models Gain in Popularity

By Deborah J | Success Stories

Feb 18

Graeme Cox is Managing Director and Co-Founder of Davco OptiSurface Pty Ltd, an Australian-based developer of OptiSurface Designer, the leading 3D agricultural earthworks design software used in over 15 countries. He sat down to talk with us so that he could share his use case with our readers.

Graeme Cox

A Company is Born

"It started 20 years ago when GPS had just become popular. My Co-Founder, David Cox, realized GPS could allow him to design agricultural fields with 3D warped surfaces rather than the traditional flat planar surfaces that lasers allowed. Following the natural topography greatly reduces the earthworks and topsoil movement required. The missing piece of the puzzle was the software to calculate the 3D "surface of best fit."

Graeme is a trained agricultural engineer with a PhD in GPS-enhanced sugarcane production and relished the challenge. The period between 1999 - 2007 was one of trial and error. They tested it on David's new farm, and worked to get a GPS machine control system to read in their design to do earthmoving. Once they were seeing impressive results, it was time to commercialize their software so other farmers could get the benefits of this breakthrough technology. That is how OptiSurface was born.

It took a couple of years before the OptiSurface Designer software was released. It is a powerful analysis and design software tool for agricultural land forming used to improve farm profitability through improved water management. Too much water kills crops and that can be avoided by optimizing field topography. Fields can also be converted to furrow irrigation and greatly increase yields. Using OptiSurface Designer to design the new topography can save farmers 50% to 80% in earthworks compared to traditional laser type designs.

Third-Party Sellers & Credit System

"We typically save farmers hundreds of dollars an acre," Graeme explains. "We thought it was an easy decision for them to pay a few dollars per acre to get access to the benefits of our technology and save hundreds. That's been our proposition." They found this to be an equally compelling proposition for agricultural consultants, GPS equipment dealers, and earthmoving contractors as it is for the farmer. These folks have become OptiSurface dealers.

They purchase an OptiSurface Designer Starter Pack which includes online training, email support and enough credits to process 300 acres. This is enough for approximately three projects as an average job is 50-100 acres. The dealers offer their design services to the farmer and charge by the acre. The consultant/dealer is purchasing a license ID from OptiSurface which gives them access to purchase credits at a dealer discount with room for their margin.

If they do not have enough credits to process a current project for a farmer, they receive a detailed message informing them that the field they are trying to process is X acres, they have X credits on their computer and, they need X number. They are prompted to contact OptiSurface for more credits.

Graeme comments on why they don't use a one-off perpetual license, "The problem with the traditional model is you sell a limited number of high-priced licenses and you don't get wide penetration, the sales process is longer and then there is no recurring revenue. It's just not worth it as a software developer, you can't continue to develop."

Software as a service (SaaS) has reinvigorated consumption-based licensing models. Credit-based models fall under this category. OptiSurface uses Instant Protection PLUS 3 with Instant SOLO Server to create a credit-based licensing model that is distributed through dealers and sold directly to end-users.

General Consumption-Based Model Advantages:

For the Independent Software Vendor:

  • Increase average income over time per user
  • Improved control over who is using the software
  • Dissuades piracy

For the End-User:

  • Easier to manage software compliancy
  • Typically, up-front costs are low
  • Can purchase otherwise expensive software for less money
  • Gives access to software that some users may not have considered due to being priced out

For OptiSurface, the credit-based model allows them to offer the greatest value to their end-users as they pay for exactly what they need as they need it whether through a dealer or direct. Their dealers get that same benefit in addition to easily knowing their costs per job which makes pricing their services simpler.

When asked why he would recommend the SoftwareKey System, Graeme graciously had a lot to say. "It's easy to trial, relatively low costs to get started, the support is good, the web shop being automatically set up is great. Instant SOLO Server is great, you don't have to mess around with any of that stuff. It's all taken care of."

SoftwareKey System & Support

Before OptiSurface was launched, they were looking for a pay-as-you-go licensing solution and narrowed the search down to three different providers. There wasn't much competition when it came down to it. Graeme recalls why he chose us: "SoftwareKey came up as the best option. It was low-cost to get started. Commissions were low. We didn't have a lot of money to throw at a licensing system." He also told us that he only spent time on the SoftwareKey System free trial.

Graeme and his partner didn't need SoftwareKey technical support upon implementation. Support came in handy some time later when they unfortunately experienced a software crash. He recalls, "This was a major problem that was nerve-wracking." They had no idea what was causing the problem, and reached out to our support team. "They spent a considerable amount of time looking into it and it turned out to be a setting that was causing a conflict. That kind of support is invaluable. We never would have found it on our own." Since then, Graeme enlisted SoftwareKey Professional Services to add a "remaining credits notification" within the shopping cart. A request initiated by an OptiSurface customer, now satisfied.

We thank Graeme for being a great customer and sharing his story with us. He is looking forward to getting the word out to many more farmers who can use his product, and he is interested in upgrading data analysis to improve how he manages the needs of his dealer network. The word is spreading that they are saving farmers hundreds of dollars per acre which is why OptiSurface Designer is the #1 best-selling 3D agricultural earthworks design solution celebrating over 350,000 acres of optimized agricultural earthworks... and growing!

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About the Author

Deborah Jackson contributes in a variety of areas on the business operations end of things bolstering our continual improvement. When it comes to marketing activities, she considers the process of creating Success Stories to be a unique pleasure. Conducting customer interviews means spending quality time with a diverse cross section of SoftwareKey.com customers.These special customers are willing to share their personal business challenges in an effort to help others navigate software licensing territory. It’s typical to find her in passionate conversation exploring what’s next for humanity, in conjunction with discovering the power within the territory of consciousness itself. She insists this is great fun!