QlikTech Rolls Out Usage-Based Pricing

Published: May 30, 2006

by Alex Woodie

Business intelligence software developer QlikTech is demonstrating that it understands the frustrations business users have with present-day pricing schemes. In the new release of its QlikView software, the company adopted a bold and unorthodox usage-based pricing scheme that charges customers according to how much they use the product--or, more exactly, by how much clicking they're doing. QlikView version 7.5 also brings enhancements in the area of SOA enablement, Salesforce.com connectivity, and new statistical functions.

QlikView is a Windows-based business intelligence tool that enables users to analyze data from a variety of sources. The software is composed of a server component that runs the in-memory associative database and its Associative Query Logic (AQL) engine, and a client component where users submit queries and manipulate the data using a range of tools accessed through a GUI. QlikTech has positioned QlikView as a more affordable and easier to use alternative to the big OLAP tool vendors, a move that is beginning to pay dividends.

Now the company is taking its low-cost, high-volume strategy even further. "There's a whole class of users who don't use business intelligence software because it's too damned expensive," says Anthony Deighton, QlikTech's vice president of marketing. With QlikTech's new usage-based pricing, customers pay ahead of time for the number of "usages" they think they're going to need.

What exactly is a "usage"? QlikTech defines a usage as the process of logging into the program, doing work, and then logging off. It is actually a little more complicated than that--the vendor calculates exact usage with algorithms built into the product--but that's the general idea. If users exceed their allotted usage, the software will stop working, which will require them to call their vendor to get a new activation key--and likely purchase additional usages.

"Essentially, you only pay for what you use," Deighton says. "Rather than charge users based on a model of named users [or concurrent users]--which we still have by the way--we add on the capability to charge users based on usage," he says. It counts as a usage "only if they're clicking. We're literally charging users based on if they're using the application."

The new usage-based pricing will help smaller IT shops because they were the ones that had the hardest time justifying the high cost of a multidimensional database application. Deighton estimates some customers will pay up to one-tenth less through usage-based pricing, although for some customers--those using the product more than 10 times per month--it will be more cost effective to use named-user pricing. The cost of traditional named-user licensing averaged about $900 per user, the company said previously.

It should be a win-win situation for QlikTech and its customers. "The customer is happy because they get a lower price. We're happy because we get more users," Deighton says.

QlikTech is no stranger to growth. In the past 12 months, the company says it has added nearly 2,000 new customers, and now boasts of 3,700 distinct customers, including some big names such as Pfizer, Top Flite, and The Campbell Soup Company. To support its customers--a good percentage of which are OS/400 shops looking to tap the data captured in their ERP system--the company has grown from 70 employees in late 2004 to more than 200 employees today. International headquarters were recently moved from Raleigh, North Carolina, to Radnor, Pennsylvania. This location also serves as corporate headquarters for QlikTech, although R&D is still done in Lund, Sweden, where the company originated.

The growth in the customer base mirrors what the company is doing with the product. "The focus over last 18 months in development has been marrying conflicting priorities," Deighton says. This means keeping the product easy to use and fast to set up, while building more capabilities into the product to make it more enterprise-ready and enable it to handle the billions of records large customers demand from their BI products. "Typically the bigger your analyses get, the more feature and function you add. On the other hand, features and functions make it less simple," he says.

The new usage-based pricing is one part of the move to keep QlikView easy to buy and use. Other changes QlikTech has made with version 7.5 include the capability to run QlikView entirely on the desktop, without the Windows server component. The new "desktop business intelligence" feature in QlikView Professional allows users to combine local data with the data they pull from enterprise systems with information they have on their desktop.

QlikView 7.5 also brings a new key performance indicator (KPI) library. Now, whenever a change is made to a KPI definition, that change can be propagated automatically to all other reports or applications that use that KPI. "From the perspective of the developer, it's very powerful," Deighton says.

This release also brings new Web services-related features, including the capability to pull data out of online CRM service provider Salesforce.com using XML and related protocols. This is an important features because, as the software as a service (SaaS) trend continues, the capability for tools like QlikView to get data out of SaaS implementations will depend largely on support for common Web services protocols.

Finally, QlikView 7.5 brings new administrative functions, such as the capability to monitor the QlikView server from Microsoft Management Console or from within the performance monitoring component in Windows, as well as new analytical features, such as on-the-fly creation of new dimensions, infinitely nested aggregation, and support for statistical analysis functions.

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