Definition
Seat-based pricing charges customers based on the number of users or seats provisioned.
Why it matters
It is easy to explain and forecast, but can misalign value when usage intensity drives cost.
Pricing implications
Use active seat definitions, minimum seat commitments, and overage pricing to prevent misuse.
Measurement tips
Track seats provisioned vs active, and monitor cost per active seat to protect margin.
Checklist
- Define what counts as a billable seat.
- Decide on active vs provisioned billing.
- Set minimum seat commitments.
- Provide seat tiers with volume discounts.
- Add overage pricing for seat spikes.
- Monitor seat utilization trends.
- Avoid incentives to create unused seats.
- Align seat limits with plan value.