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SaasBlogs has an interesting question on pricing for SaaS companies - When should software be sold pay per use? 

Why did I find the post, and related comments, so interesting?  Specifically because the question is central to almost every business, and answering it requires thoughtful consideration.

The author postulates that there are two primary pricing options for SaaS applications - fixed recurring fee for unlimited usage (FRF) and pay-per-use (PPU) (author’s note: my acronyms for this post only).  Vendors of SaaS offerings should choose each according to the value acquisition of the customer.  For example, if the customer benefits greatly from sporadic usage, allow them to PPU.  However, if they can continue to benefit as usage increases, provide the FRF model.

I understand the positioning, but would advise MVaaS providers to proceed with caution.  In my view, PPU is risky for MVaaS software vendors, and should rarely be implemented. 

Why?  There are several reasons. 

1. PPU models communicate to the customer that they are first and foremost an opportunity for increased revenue.  Don’t believe me, what do you think of ATM user fees?  Yea, me too.
2. PPU models discourage usage.  There is no surer way for a customer to question the value of a MVaaS solution than to have them under-utilize it and fail to realize all of the available benefits.
3. PPU models introduce uncertainty.  Humans detest uncertainty, and decision-makers are human.  The certainty of $50 per month, no exceptions, is comforting.
4. PPU models are not typical in the software space.  Be prepared to answer tough customer questions on how the PPU model will save them money in the short and long-runs.  Otherwise, be prepared to congratulate your competitors.