A software license that is based on actual usage (server time, bytes of data transferred, transactions processed, etc.). A major incentive for cloud computing, consumption-based pricing is competing more with the per-seat pricing of software-as-a-service (SaaS). Also called "pay-as-you-go," promoters of consumption-based licenses claim that per-seat licenses are not fair when one person may use the program for twenty minutes a week while others use it all day long.
The Foundation of Cloud Computing
Cloud computing became extremely popular due to consumption-based pricing. Customers pay the cloud provider for actual processing time a server is in operation or the amount of data transferred from a storage service. See
SaaS licensing,
cloud computing. Contrast with
concurrent-use license and
per-seat license.