CA announces new business model

Computer Associates International (CA) is altering its business model from an enterprise licence model to a subscription-based model in an attempt to offer greater flexibility to clients while reducing risks and costs associated with traditional software licensing.

In response to rapidly evolving e-business requirements, the enterprise solutions provider plans to improve the ability of clients to determine the length and dollar value of their software licences, with discounts determined by both parameters.

"Our clients have told us they need more flexibility in how they license software and a faster, simpler, more cost-effective way to do business with us in the new economy," Sanjay Kumar, CA president and CEO, said.

Kumar believes the new model strengthens CA's competitive edge against hardware vendors who bundle software and services as well as giving it a leg up on independent software vendors who cling to the traditional enterprise model.

CA is keen to build stronger relationships with its worldwide customer base and unlock shareholder value by improving the visibility of CA's revenue stream and quarter-to-quarter revenue predictability.

"It [the new model] eliminates the backend loaded nature of our business where most license agreements are concluded in the final days of a quarter."

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