Home Blowing the Cloud Wide Open: Box.net to Begin Negotiable Enterprise Licenses

Blowing the Cloud Wide Open: Box.net to Begin Negotiable Enterprise Licenses

The generally accepted definition of “cloud services” – even the one prescribed by the U.S. Government (PDF available here) – includes the existence of metered or measured service – usually a flat rate that scales along with the service consumed.  Now one of the cloud’s most prominent competitors is opening up its enterprise license program to negotiation, enabling big customers – perhaps including the government itself – to name their price and enter into long-term, fixed-price deals.

Box.net’s move, announced this morning, opens the door for potentially very large customers to enter into long-term arrangements that would otherwise be quite expensive.  Think businesses with tens of thousands of users – for example, P&G.

The Return of Deal-making

“It’s not at all uncommon for software providers to have an enterprise license agreement [ELA], but very atypical to date in the world of cloud,” acknowledges Whitney Tidmarsh Bouck, Box’s general manager for enterprise products, in an interview with ReadWriteWeb. “What we’re doing is formalizing a program around enterprise license agreements for Box. Like a typical ELA, this is about purchasing for a wide array of users, with a prenegotiated price, potentially in a multiyear arrangement that locks in a really good price for the customer, so that they’re getting the most cost-advantageous deal and that they simplify their overall purchasing with us.”

Up to now, for very large customers with tens of thousands of seats, the flat scale of cloud service pricing has actually not been very cost-effective. ELAs remain attractive for this class of customers mainly for this reason, and it could be why they opt to stay with all-on-premise resources and applications. But the on-premise choice leaves big businesses’ IT departments stuck in the previous century, especially in terms of procurement (some of which still takes place on paper), installation, testing and deployment. “Why would you buy an ELA up front if it’s going to take you a super-long time to roll out to end users?” Bouck asks.

“Usually you’d buy-as-you-go until maybe you hit the halfway mark of rolling out to users, and then consider an ELA,” she adds, “which means those first-half purchases you’re making are probably pretty expensive.”

Managing Larger Boxes

Box’s updated administrative console, whose availability also begins today, will enable high-level customers to enter into long-term ELAs, which fix their prices at negotiable, set amounts in advance, and then deploy the entire service to all users immediately after signing. The new console represents the next phase of Box’s adoption of a cloud-based version of group policy, where administrators set privileges and capacities, and marshal the storage process for employees who use the service as part of business.

“In the past, our administrator certainly allowed a privileged administrator to go in, see and manage content by user if necessary,” Box’s Bouck explains. “Imagine if one of 10,000 users had a problem; they’d go to the administrator and say, ‘Hey, I forgot my password,’ or, ‘I’m no longer on this project any more; could you please transfer all my content to the new project lead.’ But we didn’t make it very easy for administrators to easily do that in a large-scale user deployment, when you need to manage content across many user accounts.  Those one-off types of things are easy, but what if I need to query for content across all 10,000 of my employees that fit a certain set of criteria?  Or pull all the image data from the month of June across all users? That type of functionality wasn’t there in our admin console. Now we have it.”

The addition of an “All Files” tab, she goes on, lets admins scan lists of stored files across one or more users in the list. Files can be dragged and dropped between accounts. And an enterprise search field lets admins query files across a broad array of users.

“Especially for things like e-discovery, this is crucial,” states Bouck, whose last job involved managing an e-discovery suite for EMC. “If I need to pull all the content related to a particular legal matter, and be able to search by keyword, user name, content type, date range, whatever – across my entire portfolio of Box users, or maybe some group of them, I can pull off all that content and hand it off for legal processing as part of that discovery.”

Bouck admits this doesn’t make the Box service a complete e-discovery tool just yet, though it does enable and even encourage partners such as Autonomy to develop services that make use of the audit tables that Box does generate, and mine those tables for actionable data for e-discovery purposes.

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