Seat pricing is breaking, and vendors know it

The seat has been the unit of enterprise software pricing for two decades because it correlated with usage and was easy to audit. Both properties are weakening. A team of five running automated processes can generate the workload of fifty, and a team of fifty can hold licences they barely open.

Vendors are experimenting, and the experiments are visibly uncomfortable. Nobody wants to be first to a model that makes revenue less predictable.

What buyers are being offered

• Hybrid: a reduced seat fee plus consumption, which usually raises the total and is presented as flexibility.
• Outcome pricing, charged per resolved ticket or completed document. Clean in principle, contentious in disputes.
• Capacity tiers, which reintroduce the shelfware problem the seat model already had.
• Unlimited seats with a platform fee, quietly the most popular where the vendor has pricing power.

We renewed for fewer seats and paid nineteen per cent more. Both sides called it a win, which tells you the unit stopped meaning anything.

What to watch

Auditability. Consumption models only hold if the buyer can verify the meter, and most current implementations ask them to take the vendor's word for it.