A Way Out of the HPC Application Software Pricing Dilemma?
By Steve Conway, Research Vice President in IDC's High Performance Computing Group
July 09, 2007 - IDC Link
At the ISC2007 European High Performance Computing conference in Dresden, Altair Engineering launched version 9.0 of its popular PBS Professional HPC workload management software with an innovative pricing approach that could become a model for other independent software vendors (ISVs) serving the fast-growing HPC market.
In recent IDC studies, technical computing sites have consistently pointed to ISV software pricing as a major barrier preventing desktop technical computing users from moving up to servers and technical server users from expanding their systems even faster than is happening today. The CEO of an engineering services firm with a long history of desktop technical computing, for example, said that migrating his four users and their key applications to servers would instantly increase the firm's annual software licensing fees from today's $50,000 level to $120,000. That's a mighty leap for a small business.
Many large and midsized firms are also displeased with traditional software pricing models that they believe are a mismatch for today's HPC hardware architectures and trends, especially the recent cluster revolution and now the multi-core phenomenon and the growing importance of outsourcing. To be fair, ISVs have struggled in earnest to find the right pricing formulas for their own, mostly small businesses during this time of wrenching change. Simply multiplying single-core pricing by the multi-core count sends licensing fees through the ceiling (and fails to address performance degradation caused by reduced per-core memory bandwidth), so ISVs tend to discount this formula a little – but even this discounting has left many users dissatisfied.
Enter Altair with PBS Pro 9.0 and an innovative pricing model in which sites pay only for what they actually use. A site obtains a license for a specific number of concurrently used cores. It doesn't matter who is using the cores, as long as the specified core count isn't exceeded. It doesn't matter, either, whether the cores are on the site's own technical server or on an external, outsourced machine. A token-based system keeps track of the pool of physical and virtual cores.
This pricing model stands an excellent chance of working well. It turns out that Altair has successfully used it for almost a decade with the company's HyperWorks software products. It also turns out that UK-based Allinea Software has been using a similar pricing scheme for its HPC software offerings for a year and a half. What remains to be seen is how many other ISVs adopt a token-based model like this.
We invite other ISVs to explore new pricing models and share their ideas with us.
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