February 10th, 2005
Ping Identity's pay-as-you-succeed federation server
Start-up Ping Identity has come up with an innovative model for selling its PingFederate 2.0 identity federation server. Instead of pricing by the number of servers, applications, users or connections, the company is using identity transactions as the metric. The deal is this: PingFederate can be installed on an infinite number of servers (if you have that many), with an unlimited number of users, applications and connections. For up to 100,000 identity transactions, as well as updates and upgrades, the server is free. Past the 100k threshold, pricing starts at $10,000 per 1 million transactions or $30,000 for unlimited transactions per year, both including support and maintenance. Ping Identity CEO Andre Durand calls it “pay-as-you-succeed.”
Ping Identity’s Eric Norlin told me that the conventional pricing per server wasn’t an attractive business model and other schemes they evaluated were equally unattractive. They brought in industry guru Craig Burton, who prodded the PingIDers into thinking about their value proposition–selling value-added Web services for federations, and what could be more straightforward than charging a penny per transaction, such as single-sign on.
Given that the market for federated identity is embryonic–only a few hundred live federations based on the SAML protocol exist–the challenge is in getting companies to buy into federation. The 100,000 free transactions is a good incentive, especially for companies subject to the desires of a larger entity, such as the thousands of smaller companies with diminutive IT budgets in Wal-Mart’s supply chain. In some cases, a company could last years with the 100,000 limit without having to pay a dime. But, clearly the expectation is that the free offer will accelerate market growth and generate cash flow.
Of course, companies could download the open source SourceID, which is the foundation of PingFederate, for free, but it lacks the administrative interface and other features that hide the complexity of dealing with protocols like SAML and WS-Federation, as well as keystore management, updated distributions and support services. And, PingFederate presents an alternative to buying into the software suites from companies like IBM, Microsoft and Sun that include identity federation services. But, even with free transactions, open source software alternatives and improved security, federating is a bit like herding cats. Dealing with the cultural and legal issues will certainly be more contentious than deciding which server or protocol to adopt…
Dan Farber, editor-in-chief of CNET News.com, has more than 20 years of experience as an editor and journalist covering technology. See his full profile and disclosure of his industry affiliations.
