Software licenses are a big investment for modern companies.
Companies require effective license management to reduce inefficiencies and waste. It helps them make the most of the resources at their disposal while avoiding overspending.
Without proper management, you might purchase more licenses than required, challenging your team’s budgets. Many organizations use G2 Track to control their spending on software licenses and use them effectively.
Cloud services have made license management even trickier. The presence of multiple software subscription licenses makes tracking their usage challenging. Sometimes, your teams might start using a new tech without getting a green signal from IT, adding a security risk.
There are a lot of reasons that make a solid case for license management. Let’s look at a few stats that reflect the present and forecast the future of license management.
Software licenses management statistics
The increasing demand for software as a service (SaaS) has led to an increased need for software license management. It helps companies reduce unnecessary spending on unused licenses. Dive into these statistics to visualize the state of the market.
- The market for software licensing was predicted to reach $14.34 billion in 2023.
- Businesses in the UK spend over £1.7 billion yearly on unused software licenses and services. In the US, this spending rises to $32 billion.
- The software license management market is set to grow to $6 billion by 2035.
$34 billion
is wasted annually on unused licenses in the US and UK.
Source: TechRepublic
- In 2023, spending on SaaS was 33% more than in 2021.
- By 2025, the SaaS markets in China, India, and Brazil will double.
- Germany's SaaS industry is expected to grow from €6.85 billion to €16.3 billion between 2020 and 2024.
Software licenses usage statistics
A significant portion of a company’s IT budget goes into software. Yet, there are many inefficiencies and non-compliance in its usage. Large organizations end up purchasing unnecessary licenses, while some companies over-license to evade audit penalties. Inefficient use of software licenses leads to a waste of resources.
Shadow IT further complicates license management for organizations that inadequately review software usage. The stats below show how different companies operate their software licenses.
- On average, software takes up 34% of a company's IT budget.
- Large organizations, with employee strength between 30,000 and 100,000 believe they have more licenses than needed.
76%
of companies over-license their software to avoid penalties from audits.
Source: Walkme
- 56% of software audits result in extra charges due to past under-licensing.
- 30% of software licenses are never used, and another 8% are rarely used (less than once a month).
- 85% of organizations don’t fully comply with their software license agreements.
- 64% of companies don't use automated tools for managing software licenses.
- 58% of mid-market software users use unapproved SaaS licenses.
- 56% of enterprises report software usage needing to be properly reviewed by IT or security.
Waste and inefficiency in license management
Due to over-licensing, many companies use their software budgets inefficiently, leading to the wastage of resources. Moreover, lack of clear ownership or approval, among other things, further compounds this wastage.
Let these statistics help you discover inefficiencies in your operations, helping you manage software licenses intelligently.
- Camtasia Studio, Crystal Reports, and Adobe InDesign are the top three least-used enterprise licenses.
- 47% of software in education and 28% in government sectors are wasted.
- 80% of people have over $100 worth of unused software on their PCs.
50%
of enterprises waste over 10% of their budgets on software, SaaS, and cloud infrastructure.
Source: Forbes
- 53% of SaaS licenses remain unused despite businesses using over 300 SaaS products.
- IT and security use 93% of SaaS apps, with other departments using less.
- Products without a clear owner or approval comprise 10-15% of a company’s tech stack.
Industry views and predictions on license management
Software vendors understand that companies can easily identify and manage the products they use. But when the number of products used increases, it becomes tricky to get hold of these software subscriptions and licenses effectively.
Examine the following stats showing the market’s perception of license management.
- 60% of software producers think it should be easy for companies to know what products they can use.
- 25% of a software budget goes to managing license complexity.
- Companies can cut software spending by 30% with better practices.
79%
of employees think using new tech without IT approval risks company security.
Source: Next Plane
- 71% of companies use cloud-based SaaS for faster IT services.
- Businesses have over 108 known cloud services on average.
- SaaS spending grew by 58% annually based on company size.
Managing software licenses efficiently
Effective management of software licenses helps a company take control of its budgets and resourcefully use company finances. The stats above show that many companies find it tricky to leverage the money over-spent on software licenses. Cloud-based services further complicate their license management methods.
They need a better strategy and technology to keep licenses in their control and use them efficiently.
Learn more about software license management best practices to reduce wastage while complying with regulatory standards.
by Daniella Alscher
by Mary Clare Novak
