How to choose the best LMS pricing model

Table of contents

1. Different LMS pricing models
2. Which LMS pricing model is the best?
3. Which pricing model does Easy LMS use?

Different LMS pricing models

According to a recent GetApp survey, spending too much money is the most common business concern when selecting software, beating out features, security, and integrations [1]. Most vendors prioritize their own needs and the needs of their investors when choosing a pricing model.

If you want to purchase an LMS for your organization, you will likely wonder what the different pricing models are and which you should pick. Let us consider some of the options [2].

Model 1: Perpetual license and maintenance fee

If you don’t want to worry about monthly or annual fees, you can opt for an LMS that offers “complete” ownership. This model, also known as a perpetual license, is the old fashioned way. It sounds like a dream to your finance department, but it actually isn’t.

This model usually comes with a commitment to big yearly contracts

You will probably have to pay for a set-up fee because it's overly complicated. In most cases, you’ll need to install the software on your company’s local computers. The LMS will occupy hard disk space instead of being accessible from the cloud.

The problem is that after the dust settles, you’ll have to pay a yearly or a regular maintenance fee to fix anything that could (and will) go wrong with it. This model usually comes with a commitment to big yearly contracts, for which you have to pay a lot upfront and hope for the best.

Model 2: Cloud-based subscription and paying per number of users

This pricing model is one of the most common for cloud-based Learning Management Systems. This structure includes different subscription types with various features. Each subscription has a different user limit ( we mean learners or participants, i.e., the people taking your learning content). Depending on the LMS vendor, those users can be registered or not:

• Paying per user: With this model, you pay for each person that uses the LMS, whether registered or not. It potentially eliminates the hassle of adding and removing users all the time. But it can become quite costly if you have a lot of users.
• Paying per registered user: In this model, every user must be registered in the LMS (create a login and password) to access the LMS platform. It’s necessary to frequently add and remove users to “clear the seat” for new ones.
• Paying for active users: This model sounds like one of the most cost-effective options, but it’s quite hard to understand and maintain. You only pay for the number of users who accessed your LMS during a specific billing cycle (such as monthly or every three months). Depending on the length of the billing cycle, it may not be an interesting alternative. If different users come and go all the time, you might end up paying for “active” users who are not active anymore.

Model 3: Cloud-based subscription and unlimited users

In this model, you pay a monthly or annual license for the LMS. The license allows for an unlimited number of users, active or otherwise. When evaluating different Learning Management Systems, check if there are no other set-up fees, contracts, or the like. The license often comes in three or four different levels with different features available.

Model three provides you with the most generous amount of flexibility

To be able to access more features, you may need to upgrade to a higher subscription level. Because it’s a monthly or yearly subscription, it's relatively easy to switch to a different LMS provider from a contract point of view. Although it still takes a lot of work to change systems. Model three provides you with the most generous amount of flexibility. You also don’t have to worry about adding, removing, or keeping track of your active users.

Model 4: Custom pricing

Enterprise companies may prefer going for custom pricing and a custom LMS instead of an off-the-shelf product. Some LMS companies are specialized in that market. Setting up such a system for big companies can be a long and arduous process.

After many meetings, approvals, requests, and customizations, the LMS is ready for use. The upside is that the company gets a tool that is fully customized to their needs. The downsides are the high costs and the long processes involved. That is why some enterprise companies are also going for off-the-shelf (ready to use) learning management systems.

Which LMS pricing model is the best?

Choosing the best pricing model for you depends on the price and the service offered. Still, after reading up on all the different pricing models, you probably know which one is our favorite. That's pricing model 3: cloud-based subscription and unlimited users. It is also Easy LMS’s pricing model!

Easy LMS came up with a unique pricing model of limiting participant sessions

Which pricing model does Easy LMS use?

If you have checked our pricing page, you probably have noticed that we don’t charge per user. We have three primary subscription levels with different features and a limit of participant sessions.

There’s a reason for that. Easy LMS got its start as a quiz tool that allowed many attempts per participant. Since it was a quiz, people needed to be able to play unregistered. That’s still possible in our tool, by the way. So we came up with a unique pricing model of limiting participant sessions. A participant session is an attempted course, exam, or another piece of learning content. One person can have multiple attempts, or multiple people can have one attempt. It doesn’t matter. If you want to know more about participant sessions, read about it here.

So, it didn’t make sense for us to charge per user. It wasn’t intentional at the time, but our unique pricing model started to attract more and more clients that didn’t want to pay per user. There was even a time when we considered switching to an “active users” pricing model, but we found out that most preferred our “participant sessions” model after surveying our clients. So we stuck with it. We think you will like it too 🙃.

Useful resources

1. GetApp
2. eLearning Industry

Frequently Asked Questions