License Management Market Size, Share, and Industry Analysis By Component (Software and Services), By Deployment (Cloud and On-premise), By Enterprise Type (Large Enterprises and Small and Mid-sized Enterprises), By Application (Audit & Compliance Management, Configuration Management, Operation & Analytics, Subscription & Contract Management, Advisory Services, and Others (Usage Monitoring) ) By Industry (BFSI, IT & Telecom, Healthcare & Life Science, Government & Defense, Manufacturing, Education & Research, and Others (Manufacturing)), and Regional Forecast, 2025-2032

The global license management market is expanding owing to a rise in the adoption of solutions for managing licensing. Cloud-based software and subscription models have fundamentally changed the licensing landscape and the term 'perpetual ownership' has been substituted by the term 'usage-based access,' which generates a need for sophisticated tools to manage dynamic entitlements in various cloud settings and hybrid infrastructures. The practices and tools involved in managing, monitoring, and minimising the costs tied to software and other digital assets within an organisation are known as license management, while the aim is to keep up with vendor agreements.

The increase of the complexity of the software ecosystem, driven by the microservices, the containerisation, and the productivity of IoT devices, the need for modern license management solutions has grown. The solutions should be able to handle different types (i.e., license types) of licenses and granular use tracking.

License Management Market Driver

Increased Use of Software to Expand the Market

The first driver of the license management market is the increased use of software in all industries. Today, with all businesses, big and small, embracing digital transformation, both the range of software that businesses are deploying is growing, including personal productivity tools, enterprise resource planning systems, and outsourced industry-specific solutions.

Regulatory Standards to Advance the Market

An important factor for driving the market is the increasing demand to follow the regulatory standards. It is because organisations from different sectors are subject to strict data privacy, intellectual property, and software usage regulations. Non-compliance will lead to high fines, legal punishments, and negative publicity.

License Management Market Restraint

Complexity of Software Licensing Agreements Pose Potential Impediments on this Market

A restraining factor for the license management market is the complexity of software licensing agreements. For example, software vendors are using all kinds of complicated and different types of licenses per user, per device, concurrent user, subscription, and so on, with different terms and conditions for each.

License Management Market Opportunity

Expansion into the Emerging Markets to Create Opportunity in this Market

The license management market has a substantial opportunity in the expansion into the emerging markets. At the same time, developing economies are becoming digitally accelerated, and their adoption of software solutions is increasing. The prevalence of software usage is growing and with it comes a need for strong license management tools to ensure compliance, minimize costs, and eliminate risks from software that one does not own.

Key Insights

The report covers the following key insights:

• Market Drivers, Restraints, and Opportunities
• Influence of key industrial players and key developments
• Adoption of Cloud-based software
• Key Trends in the Market

Segmentation

Analysis by Component

By component, the market is divided into software and services.

The core license code, which automates license tracking and monitoring as well as performs license management operational tasks within a software component, is present here. However, this segment is growing, owing to more and more sophisticated software solutions that are leaning on the possibilities of AI and machine learning to go deeper in understanding license utilisation, predicting needs in the future, and thereby saving networking costs.

Professional expertise in license consulting and implementation and in a number of areas related to the services of license management can go into the services segment. The complexity of software licensing and the requirement of special knowledge have led the size of this segment to grow significantly in parallel.

Analysis by Deployment

Based on deployment, the market is divided into cloud & on-premise.

With increasing adoption of cloud computing and SaaS applications, the cloud-based deployment segment is growing at a fast pace. Cloud-based license management solutions provide, in terms of both scalability and flexibility, a solution that enables an organisation to manage its license from the comforts of their office to the remotest coffee kiosk in the world where they will have internet connection.

The on-premise deployment still has a large share of the market, especially for the organisations seeking strict data security and compliance. This enables businesses to have more control over data and infrastructure yet customise license management systems to meet their exact needs.

Analysis by Enterprise Type

Based on enterprise type, the market is divided into large enterprises & small and mid-sized enterprises.

The demand comes from large enterprises, whose IT infrastructures are complex and whose software portfolios are extensive, and for highly complex and comprehensive license management solutions. This may lead to the dominance of the segment in the future.

Although they have smaller IT footprints, SMEs are increasingly aware of the importance of good license management to control costs, ensure compliance, and support growing software needs.

Analysis by Application

Based on application, the market is divided into audit & compliance management, configuration management, operation & analytics, subscription & contract management, advisory services, and others (usage monitoring).

Increasing need for organizations to show adherence to its software licensing agreements and regulatory standards definition of the audit & compliance management segment. As software audit penalties are growing and companies are being audited more often, businesses desire a robust tool to document how much software is used, generate audit trails, and see that they are properly licensed.

The configuration management segment is to make sure that software deployments meet the software licensing terms and company policies. This involves monitoring software installations, configurations, and usage patterns to determine the appropriate resource allocation to ensure that the amount of licenses is not over- or underused.

Analysis by Industry

Based on industry, the market is divided into BFSI, IT & telecom, healthcare & life science, governement & defense, manufacturing, education & research, and others (manufacturing).

Stringent regulatory requirements and data security concerns, as well as the need for robust compliance, propel this demand in the BFSI sector. Financial institutions take care of sensitive customer data and depend on various software applications for core banking systems, risk management tools, and compliance software.

All of these put the IT & telecom sector as an inherently software-dependent industry with a large number of software deployments and corresponding complex licensing situations. In today’s world, software is being developed for and used by IT and telecom companies in the form of operating systems, network management tools, and other specialised development tools.

Regional Analysis

Based on region, the market has been studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

In world markets, North America is the dominant force in the license management market. They also contribute greatly to this region’s advanced technological infrastructure, high rate of software adoption, and stringent regulatory environment. The presence of numerous global technology companies and a strong emphasis on software asset management drive the demand for sophisticated license management solutions.

• According to the U.S. Postal service office of inspector general, in fiscal year 2016, the U.S. Postal service’s information technology group spent approximately USD 174 million on software licenses.
• According to the U.S. Postal service office of inspector general, in 2015, the U.S. Postal service approved a decision analysis report for about USD 35 million for a software asset management program.

The stringent data privacy regulations in Europe in particular, such as the General Data Protection Regulation (GDPR), as well as Europe’s varied economy, have an impact on the license management market as Europe’s influence. These factors necessitate the usage of license management solutions to guarantee compliance and data security.

The license management market in the Asia Pacific region is growing at an increasing pace, driven by improving living standards, growing economies, and awareness of IP rights. This is because businesses in this region are gradually embracing more software applications and the realisation of the need for effective license management.

Key Players Covered

The report includes the profiles of the following key players:

• Oracle Corporation (U.S.)
• IBM Corporation (U.S.)
• Flexera (U.S.)
• OpenLM (Israel)
• USU Software AG (Germany)
• Reprise Software (U.S.)
• Thales (France)
• Quest Software Inc.  (U.S.)
• ServiceNow (U.S.)
• Ivanti, Inc. (U.S.)
• DXC Technology Company (U.S.)
• Microsoft Corporation (U.S.)

Key Industry Developments

• In April 2021, Zylo announced the rollout of License Optimization Workflows. This feature would allow customers to maximize investments in SaaS applications and reclaim and identify underutilized licenses.