Let's start with some context: This blog post is about the Shopware Store, the marketplace for extensions. This marketplace is owned and operated by shopware AG and is firmly integrated into the Shopware ecommerce platform. It allows you to buy and sell extensions that offer additional functions for a Shopware store. At the same time, you benefit from the curation and further development offered by the platform operator - shopware AG. Since December 28, 2023, a rental license is the only available option to purchase an extension license. Of course, the option to offer and obtain extensions free of charge still exists.
Previously, it was also possible to buy and own the rights to use some extensions for an indefinite period and optionally subscribe to updates. In this case, the price and offer or obligation to purchase a subscription were the decision of the provider. This resulted in a high need for explanation for new customers of the Shopware Store.
Renting instead of buying
This blog post highlights the benefits of the rental model for extension partners and merchants and discusses some of the key concerns about this change.
On the surface, the main difference between the now-defunct purchase model and the rental model is simple: with a rental license, a store loses the right to use an extension once the rental period ends. The old model made it possible to buy a specific version of an extension and use this version indefinitely. After one year then without support or updates from the extension partner.
This is one of the implications, but not the most important one. First, it is important to talk about the lessons learned from the operation of the Shopware Store. Since the initial introduction of the rental model about ten years ago, many merchants have opted to rent extensions instead of buying them. This seems counterintuitive at first, as it seems to drive up the operating costs of the store, the TCO (Total Cost of Ownership).
However, it turned out that renting an extension does not drive up the total cost of ownership – only in a specific use case. Even after purchasing an extension, a subscription was required to receive updates. If the cumulative price of renting versus buying a subscription is the same for a year, the cost is the same. Renting an extension simply simplifies the process and spreads the investment for the retailer. This also makes the rental model easier to calculate than the purchase model.
Since the extension partner always has control over the pricing, the last paragraph does not apply to all extensions, but that is the decision of the individual partner.
So which use case drives up the TCO? It's a simple calculation to not update the store, and thus also save the purchase subscription costs for installed extensions. Or to update the store at longer intervals than one year, which also saves costs on paper. Every store operator is free to do this and ultimately bears the associated risks themselves. Unmaintained, publicly accessible software is always a risk, and if a store is not updated, it will eventually become a risk.
Not only that, but there is also an investment backlog, which makes an update, if it becomes unavoidable at some point, significantly more expensive overall than a continuous update. The case where use takes place after the retailer has stopped paying is therefore questionable from an economic and security point of view. Our experience shows that the majority of retailers behave differently.
The rental model is also of great benefit to the other side of the equation, our extension partners. It means a regular income, the ability to plan and at the same time an incentive to focus on relevant and valuable extensions. Store owners will pay for an extension as long as it is useful. If it is no longer profit-generating, it will be canceled.
Ultimately, the aim of the rental model is fairness for extension partners and store operators. It guarantees constant updates while providing a steady revenue stream. This creates a healthy ecosystem and a very straightforward and predictable form of access to extension licenses.
