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Prepping software for the AWS Marketplace

Want to get your software ready for the AWS Marketplace? There are a few things to know about policies, usage, pricing and how to market your product.

Since Amazon announced the AWS Marketplace back in 2012, many companies have looked to push their software into...

it. Types of services vary from Log Aggregation services like Splunk to full CRM deployments like SugarCRM. Some companies, like Bitnami, are essentially driven by making open source products into Marketplace images.

At its simplest, the AWS Marketplace is a simple way for technical staff to find software that works on Amazon's cloud. It's a one-click spot for deploying custom Amazon Machine Images designed for specific purposes. It's a catalog that you can submit your programs to, and let end users run the application in their own AWS environment.

How it's used

Unfortunately, most of the services that can be found through the AWS Marketplace still require a "bring your own license." This was a simple way for Amazon to get more developers to register content in the marketplace, but it really misses the point of on-demand services. The best services for the AWS Marketplace are ones that allow for simple hourly licensing.

Many companies will use an AWS Marketplace image for a trial of software. This is a viable solution as well, but it does make it more difficult for them to migrate to a live product at that point. The better solution is for you to build in the licensing when you submit an application to the AWS Marketplace, so all costs are clearly visible to the consumer at the time they spin up the instance.

The fee-based pricing model

Cloud computing is often referred to as the utility model for computers. At its core, consumers pay for what they use. The idea is that they pay for services as they're running and when they shut the services down, they should no longer have to pay for them. There is no up-front cost, and they're billed the month after their usage. They don't sign up for a costly monthly commitment, and if they need to scale their usage, they can do so whenever they need to.

The same should be true of any service you submit to the AWS Marketplace. Amazon supports multiple instance types, and within those instance types is an inherent capacity. Each server can handle only so much load; if users need to scale to more or larger servers, they can do so by requesting a new instance type.

When you submit software to the AWS Marketplace, you can specify pricing using one of three pricing models.

  • No charge (free)
  • Bring your own license (BYOL)
  • Fee-based

If you're giving your software away, that's fine (although it won't make you any money). If you're charging via a BYOL model, you're not really building a cloud-compatible sales model. Fee-based models are the best because you can choose hourly, monthly, or a combination of hourly and monthly fees. You can charge per-server fees, and this cost is added right to the customer's AWS monthly bill.

Ever have a customer cancel simply because you sent them a new bill and they realized they were paying for your service and didn't need to? With the fee-based approach, that bill is all rolled up into their standard AWS cloud charges. They'll know they're using your service and they won't be freaked out by a separate invoice. You'll take a 20% hit by doing this model, but you don't have to worry about collecting from your customers, and you don't have to have your own sales product. You're literally using the Marketplace as a market to sell your product.

List your cool stuff

The Marketplace is a great place to list your software for people to discover it. Don't weigh that down by using antiquated licensing policies. It should be easy for people to set up your software. The last thing any business wants to hear is that a potential customer won't sign up because of a conflicting business model. Your business model needs to adapt to the change in customers, and right now customers want to pay for what they use.

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Have you tried selling your software on the AWS Marketplace? What was your experience?
We gave a lot of thought to using Amazon Web Service's marketplace (AWS) to sell some of our proprietary apps and software but decided not to. The reason for our decision was based on the many peer reviews that had a pattern of shared experiences and frustrations with Amazon's payout program, the length of time for payments and the control and contract that Amazon makes you agree to prior to any sales.
Yes, AWS Marketplace has been a great channel for TIBCO's analytics offerings, TIBCO Jaspersoft for AWS and TIBCO Spotfire for AWS, both starting <$1/hr. Jaspersoft provides powerful embedded BI and reporting while Spotfire provides powerful data analysis. 
We're looking at using the AWS Marketplace. This has included modifying our application to conform with their AMI requirements. The hardest part has been the pricing model. We sell a systems management application that needs to be running constantly. The Marketplace sales rep insists that we have to offer our application by the hour. I pointed out that their Seller Guide says that monthly and annual pricing is an option, but he insisted that hourly was best. When I pressed him, he basically said "that's what everyone does."
There's a fair amount of arrogance when dealing with AWS. They're the 800 pound gorilla right now, so they don't try very hard - or at all - to be flexible. Just something to bear in mind before you engage.
Good article. The only thing I'd add is that, although AWS claims you can sell by the month or year, they really want/expect/force you to sell by the hour. If you try to do something else, they'll find reasons it won't work.