Perpetual License vs. Subscription License in Accounting System

Published Date: June 7, 2019

  

Are you planning to implement an Accounting System in your company? Have you decided the type of Software License that you want to have? One of the things that must be considered in availing an Accounting System is the Type of Software License. There are two types, the Subscription License and the Perpetual License. And you must know what type suits you best.

WHAT IS PERPETUAL LICENSE?

Perpetual Software License is a type of license that allows a company or an individual to use a program indefinitely or without expiration. The individual or company can use a software version continually for one-time payment only.

Usually, the software provider gives free technical support and software updates for one to two years. During this period, the software provider may give system updates and technical support for free. Meanwhile, after this period ends, it is up to the individual or the company to renew the Customer Care Program or not.

In Perpetual Software License, the individual or the company must pay in full or in a short-term basis for the availed accounting software for example. The whole amount for the accounting software must be settled for the company to have the ownership of the license. This makes the cost of Perpetual License Accounting Software higher. Due to higher investment cost for the individual or company to acquire an Accounting Software with Perpetual License, Vendors have difficulties to encourage them to avail. Plus, the assurance of profitability and future development costs.

SAP Business One: Subscription License or Perpetual License in Accounting System
SUBSCRIPTION-BASED LICENSING

Also called Subscription-based pricing model permits an individual or company to avail services for a specific period with a fixed cost. Subscribers have an option to select for the duration of subscription, it can be monthly or yearly. Most of the time the cost for subscription will be lesser if the company or individual selects yearly or longer subscription.

However, this pricing model can result to an individual or a company to overpay services due to definite length of subscription availed especially for annual subscription.

Subscription-based Pricing Model is now widely used specifically for cloud computing accounting software. Cloud Customers usually pays the full amount for the subscription, whether it will be for a month or a year.

ACCOUNTING SOFTWARE WITH PERPETUAL LICENSE

SAP Business One and QNE Optimum Accounting Software both have Perpetual Licenses to offer. SAP Business One and QNE Optimum Accounting Software are ideal for Small and Medium Enterprises that require Financial Management, Sales and Purchases, Inventory and Reporting.

SAP Business One is being offered by multiple vendors here in the Philippines while QNE Optimum Accounting Software is only distributed by QNE Software Philippines, Inc.

ACCOUNTING SYSTEM WITH SUBSCRIPTION-BASED LICENSING

Quickbooks is popular in subscription-based licensing used by small businesses. Xero also targets small businesses with their offer of an online accounting software.

Overall, it will still depend on the company’s capability and long-term goal whether to use a Subscription-based Accounting System or a Cloud-based Accounting Software.