Version licensing offered added flexibility to the consumer and vendor. The vendor could make frequent updates and bug fixes found after release and provide minor upgrades. Some examples of the use of the version based licensing model are Microsoft Windows 3.1 and Adobe Photoshop 7.0.
In the 1990s and 2000s, many software vendors began to use the approaching ubiquity of the Internet to provide subscription-based licensing, wherein the consumer paid on a time basis for access to the software. In this model, the user will not hold the software or run it on a local machine. Instead, the software is managed and executed on centrally managed hardware by the vendor. This will simplify the update process to the software in place hastily and will lower maintenance cost to the consumer and vendor. The vendor can control access to the services, and provide the ability to provide feature driven pricing models for the services and particular advanced features. The negative for the consumer is generally in the loss of right and possession of the software. The model represents the shift from licensing rights to own the purchased software and possess it physically to a utility-focused right. The consumer has a right to access the service or its underlying application software interfaces (API). The consumer never possesses the software or its executable code. If the consumer stops paying for the subscription, they lose access to the product. Among other issues, this model did not standardize or solve the resulting issue with ownership of the consumers’ data on the system. That is when using a subscription license, how does a user keep control of the data produced or held in the subscription-based license system? If the system stores the data in the vendor’s infrastructure (very typical for efficiency), then the consumer will need some ability to extract their data from the vendor’s storage. Some examples of the use of the subscription licensing model are Google GSuite, Microsoft Office 365, and Adobe Creative Cloud.
The Tokenized Micro-License™
Dragonchain’s Tokenized Micro-License (TML) provided a new model for software access. It allows the local holding of licenses much like the early models, yet allows for decentralized hosting of the software services. It also standardizes for many flexible forms of redemption via software access and execution. For the vendor, licensing is more flexible, and powerful anti-piracy measures are possible. Service updates can be controlled, much like in the subscription model. For the consumer, a user is not paying for a software utility that isn’t being used. Ceaseless passing of time does not itself penalize. Using the TML, license ownership is recorded on the blockchain, which decentralizes ownership and control. Asymmetric encryption technology (public key cryptography) enables the consumer to physically hold the key that “own” the tokens.
TML Service Interaction
The token itself contains a license that is maintained on the blockchain with both programmatic (smart contract-based) terms and human readable (traditional legal) terms embedded. The token’s license interacts on every use, execution, or access with a license embedded into every service (programmatic/smart contract and traditional) to create a very flexible framework for software license innovation. The terms for both the token and all services can be updated on the blockchain in a manner that allows anyone to prove and/or verify that a particular execution occurred under a particular set of license terms (or other legal arrangements). This model also allows for a very flexible update arrangement wherein a vendor may do things such as specify license update frequency, specify terms for notice on updates, or allow consumers to vote on terms or feature updates. This model can also solve issues with access to data stored on the vendor’s system as the public keys of the owner may be allowed access to their owned data even if they no longer hold license access to the system services. This can be compared to the commoditization of service utility model in the “Software as a Service” or “Platform as a Service” hosting model so prevalent today. It allows for commodity service micro-payments (e.g. Amazon AWS, Google Cloud, MS Azure) to model into the license itself and offers control in a more granular fashion. It also allows the ability to track and audit billing in a provable and transparent manner.