A breakdown and comparison of common LMS pricing models in the market
eLearning makes it easier to train employees, no matter where they are. It’s flexible, consistent, and scales with your organization. At the core of this approach is the learning management system (LMS), the platform used to deliver, manage, and track training initiatives.
But with so many LMS options available, choosing the right one isn’t always simple. Features matter. So does fit. And LMS cost, understandably, plays a significant role in most LMS buying decisions, adding another layer of consideration to an already important choice.
There are plenty of pricing models out there, covering a range of learning management system options. But there's one (or maybe more) that's right for you. Let's explore the most common pricing structures and factors out there and break down the considerations for each.
Why is an LMS such an important investment in today's world?
A learning management system has a variety of uses for all kinds of companies:
- Compliance training ensures the organization follows government regulations
- Onboarding prepares new employees with the resources they need
- On-the-job training (OJT) provides practical work experience
- Extended enterprise training better enables partners, customers, and vendors
In addition to the uses mentioned above, an LMS's criticality lies in the software's positive learning outcomes and its ability to evolve.
In recent years, the world has leaned more heavily into tech for work and education, increasing demand for remote work and schooling. In the past 12 years, the number of people who work from home has risen by 159%, with 44% of that growth in the last five years.
This trend, which was already gaining momentum, escalated rapidly during the pandemic. And with a sharp increase in remote work comes a rise in remote learning. This recent research report outlines how schools now embrace online learning.
Consider the following statistics:
- In the United States, almost all companies active in the training industry stated they were currently using a Learning Management System (LMS) in 2024. A total of 90 percent of companies in the training industry used this learning technology that year.
- Employees state that they learn five times more material via eLearning.
- eLearning can help students retain between 25% and 60% more information.
- Since 2020, 98% of universities have moved classes online.
The global eLearning market, which is projected to be worth $325 billion in 2025, underscores these eLearning trends.
Remote and hybrid work aren’t going anywhere. No matter where your teams work, from the office, at home, or a bit of both, an LMS will continue to be the most effective way to deliver learning. It gives you an interactive, flexible, and scalable way to engage your learners, promote professional development, and extend training across your organization.
Interested in seeing how Absorb LMS can enable your workforce?
LMS pricing comparison: choosing your best-fit model
Your organization has unique training needs, and when it comes to learning management systems, pricing is far from one size fits all. To make the right choice, it’s essential to weigh the pros and cons of the most common LMS pricing models. Here, we break down popular models like pay-per-user and pay-per-active user, and explore options like perpetual licensing and open-source platforms. Plus, we’ll take a closer look at the hidden LMS costs that can come with each.
01
Pay-per-user
The pay-per-user model is relatively straightforward: You pay a fee based on the number of learners in your system during each billing cycle. Every user counts, whether they’re actively completing training or just enrolled, so it’s important to know exactly who is included in your tally.
Most common use case(s)
- Companies training employees on compliance-related skills
- Organizations training a fixed number of external users, such as contractors
Could be a fit for
- Organizations with stable or predictable user numbers: If you’re unlikely to have a sharp increase or decrease in LMS users, this simple LMS pricing would probably work for you.
- Companies that want predictable billing: Finances can be quite the headache. If your LMS bill arrives with the same consistent number, you'll have one less thing to worry about.
- Companies with high engagement levels: If most users regularly log in and complete courses, this model gives you value for every dollar you spend.
Might not be a match for
- Businesses with large numbers of inactive users: Since you’re paying for every learner in the system, including those who aren’t actively using it, this model can be expensive if you don’t have consistent usage.
- Organizations with seasonal or fluctuating user bases: Industries like retail, hospitality, or gig-based platforms that have high numbers of short-term workers. These use cases may want to focus instead on pay-by-active-user models.
- Companies that train external audiences: If you’re offering courses to clients, customers, or partners, your participation may vary widely. Unless you regularly clear inactive users out of the system, you may wind up paying a lot for your LMS.
TalentLMS starts at $109/month for up to 40 users. JoomLMS starts at $399/year for 100 users, but that base version includes Joom branding and charges extra for user training and setup. The Professional version starts at $999/year and includes white-labeling, eCommerce, SCORM compliance, and priority support, making it better suited for organizations needing more customization and hands-on help.
02
Pay-per-active-user
This style is similar to pay-per-user but has a key difference that could save your organization money. Instead of being billed for every learner in your system, you’re only charged for those who use the platform during the billing cycle. Exactly what constitutes “active” may vary by platform, but it often means the user has logged in, started a course, or completed a specific activity.
Most common use case(s)
- Medium to large orgs that need access to historic activity of inactive users
- Organizations with eCommerce or customer training initiatives that have an unpredictable number of users
- Associations performing annual recertification of less active users
Could be a fit for
- Organizations concerned about maximizing value: This pricing model offers a more cost-effective approach because you only pay for the learners actively engaging with your platform. It also ensures your organization gets maximum value from its LMS investment.
- Organizations with fluctuating or seasonal user activity: Companies that train in waves, for example, onboarding cohorts or short-term, seasonal staff. If your organization uses these hiring practices, you’ll benefit from lower costs during periods when you aren’t actively training.
- External training programs: If your organization trains clients, partners, or customers who might only access the content once or do so sporadically, this model might work better for you.
Might not be a match for
- High engagement, full-time internal teams: If most of your users are active every month, this model could cost more than a flat per-user plan. Estimate engagement levels and patterns before choosing this model.
- Unclear definitions of “active”: Make sure you know and understand your vendor’s definition of “active.” Some vendors count a user active even if all they’ve done is log in, while others require interaction with a course. If the definitions are too vague, you could wind up paying more than you intended.
Price range: iSpring Learn’s rates start at $3.75 per active user per month for 500 users and go up to $6.64 per user per month for 100 users.
03
Perpetual license fee
A perpetual license-based LMS pricing model allows organizations to purchase the LMS software outright, typically with a one-time, upfront fee. In essence, you “own” the platform for as long as you use it, although you may have the option to pay for ongoing support and updates. There are also often costs for customization, maintenance, and support, and the initial investment is often high.
Most common use case(s)
- Larger organizations with their own data center or cloud infrastructure want to fully manage the LMS themselves, including updates, hosting, etc
- Entities that must strictly control their training and their learning platform for security or legal reasons (e.g. a government organization)
Could be a fit for
- Highly regulated industries: Perpetual licensing gives full control over data and system updates, making it appealing for industries with strict compliance requirements. Organizations needing to maintain systems in their data centers or control enhancement releases may benefit from this model.
- Long-term training strategies: If your organization has ongoing LMS needs for many years and wants to avoid recurring subscription fees, this model could offer long-term cost savings.
Might not be a match for
- Small to midsize businesses: The most common use cases for this model require a range of highly technical internal resources to host, maintain, and update the system consistently. Companies that have strategically shifted to the cloud will prefer a SaaS model over perpetual licensing.
- Companies that need frequent feature updates or scalability: Many perpetual-licensed LMSs don’t update as often as cloud-based counterparts. Scaling up often requires additional licensing or infrastructure.
- Organizations without significant resources: Organizations with the perpetual license fee model must provide end-user and system support if software issues arise. If your organization lacks the infrastructure to provide this level of support, this pricing model might not work.
Price range: LearnDash, a WordPress plugin, starts at $199 per year for a single site license, while Teachable starts at around $468 per year and goes up to around $2,400 per year for a Pro+ plan. Enterprise pricing for Teachable is custom to the organization’s needs.
04
Open source
An open-source LMS gives you access to the platform’s code, usually at no initial cost to you. That means you can download it, customize it, and build it out to meet your exact needs. But “free” doesn’t mean there’s no LMS cost. If you go this route, you’ll likely need to invest resources in the system’s setup, custom development, integrations, and ongoing maintenance. You’ll also be responsible for managing updates, security patches, and making sure all moving parts work together.
Most common use case(s)
- Organizations that have the technical capability to host their own LMS and want to build it to their exact needs.
Could be a fit for
- Large in-house technical teams: If your team has strong technical or coding skills, an open-source LMS might be a good fit. You can build the customizations you want, maintain full control of the system, and you’ll have a strong team managing it.
- User count freedom: If you don't want to factor your user count into the price, this won't be a problem with open source.
- Organizations with unique or complex requirements: If off-the-shelf LMS platforms don’t deliver what you need, open source provides the freedom and flexibility to customize the platform to be exactly what you need.
Might not be a match for
- Price conscious buyers: While the code is free and available, the costs of building, implementing and maintaining will likely add up.
- Small teams without technical resources: If your current organization lacks the development and IT resources to build, implement, support, and continually manage the LMS, you'll have to pay contractors to oversee it full-time. Either way, this process can quickly become overwhelming for small teams.
- Those wanting stability and UI/UX polish: An open-source LMS may not have the stability or polish of commercial products, which undergo extensive UX/UI testing, QA processes, and stringent security and hosting protocols.
- Organizations that need fast implementation: Open source LMS takes time to set up, customize, and test. If you need to get your content to learners quickly, this setup probably isn’t the best fit.
Price range: Self-hosted Moodle is free to use, and ranges between starts at $30-$50 per month depending on size and traffic. Totara Learning is geared to corporate training with costs that vary depending on needs.
Know which pricing model is the best fit for your team? Get your tailored pricing now.
Additional fees and features to consider in LMS pricing
Setup fees
LMS setup pricing includes costs associated with establishing your learning management system. For example, you may incur expenses related to adding your branding into the LMS, installation fees for dedicated servers, training fees, or additional integrations.
Implementation and onboarding fees
These fees are also incurred during the setup of your LMS, but they might be separate from the setup fees. Implementation and onboarding fees include tasks such as data migration (if you’re migrating information from other platforms or from your previous LMS), content uploads, and user provisioning.
Hosting fees
Hosting fees for your LMS can vary, depending on the features you’ve incorporated, your level of customization, and how much support you need.
Support or maintenance fees
Depending on the platform, you may have access only to basic support in your package. Priority support, extended hours, email or phone support, and having a dedicated account manager may result in extra costs. Additionally, ongoing platform maintenance or updates might also involve a fee.
Customization fees
Your organization may have particular requirements for its LMS so that it meets your needs. Examples include ensuring compliance, integrating your own software or other technologies, using specific language, or incorporating your branding.
User or storage overage fees
If you’ve chosen a pricing model with a cap on the number of users or storage space, you could pay extra charges for exceeding those limits. Fees might be billed monthly or annually for your overages.
Support
Customer support plays a huge role in choosing your LMS pricing structure. First, evaluate what level of support an LMS solution provides. Some may only offer self-serve support options, while others include a support team or a designated support contact. Likewise, not all support teams are created equal.
eCommerce
Some organizations, such as associations, franchises, training companies, and others, may hope to sell courses through their LMS. There are LMS platforms that offer out-of-the-box eCommerce functionality. Look for those with robust tools, including various payment gateways, multiple currencies, the ability to sell courses in bulk, pricing options, a brandable interface, coupons, user self-enrollment, and more.
Extended functionality
Are you looking for an LMS that offers functionality beyond the basics? This could include artificial intelligence, BI (business intelligence), gamified and interactive learning options, and social learning features.
Consider choosing an LMS platform that offers advanced options to set your learning program up for success (now and into the future).
Course authoring
If your organization has highly specific training or simply wants to personalize its courses, consider an LMS that offers built-in course authoring and/or custom course development services. You’ll never have to feel limited to off-the-shelf course options.
Analytics and business intelligence
Get deeper insight into your course performance, learner progress, and training data through your LMS's robust analytics and reporting functionality.
Reporting and analytics help you:
- Make more informed decisions
- Prove your learning program ROI
- Align business initiatives with your training
- Drive better business outcomes
Mobile access
Mobile learning is an essential piece of a learning program. In fact, 43% of learners see improved productivity levels compared to non-mobile users.
Mobile flexibility is vital for many users because of the evolving hybrid work model that requires more learners to work remotely. Therefore, investing in mobile learning, including mobile apps, is significant when considering pricing. If you want to reach learners from anywhere, consider an LMS provider with a mobile learning app.
Integrations
Integrating your most essential apps and software with your LMS is critical. Pay careful attention to the turnkey integrations your LMS offers to see if there are easy, pre-built options for your critical everyday work platforms. Many providers also enable clients to connect other systems via API.
Other additional features
Some LMS platforms allow for additional features such as note taking, advanced metrics, ratings and reviews, and gradebooks. These features may be charged separately or bundled together at a lower cost.
Aligning LMS pricing with your organization’s needs
There’s no universal pricing model for learning management systems, which is why choosing the right one starts with understanding your organization’s size, goals, and training needs. Whether you’re a small nonprofit or a large enterprise, or something in between, aligning your learning management system prices with your actual use case is key to staying on budget and maximizing the value.
Your user base
Start with who you’re training. If your organization has a stable number of internal users, a per-user or subscription-based model may provide predictable costs. But if your user base fluctuates ¾ with seasonal staff, contractors, or external partners¾a pay-per-active or pay-as-you-go model may be more cost-effective
Industry and compliance requirements
Some industries, such as healthcare, finance, or government, require advanced features for compliance, data security, and audit trails. These features often push you into higher-tier plans or more specialized LMSs. If you’re in a regulated space facing heavy fines for non-compliance, it’s more cost-effective to invest in an LMS that meets those needs without workarounds. It’ll also give you peace of mind knowing you’re compliant.
Frequency and format of training
How often your team accesses the LMS matters. If training is regular and ongoing, flat-rate or subscription models make sense. If training happens in short bursts (such as quarterly onboarding or annual certifications), usage-based pricing could help you avoid paying for inactive months.
Your internal resources
If your internal teams have the skills to handle much of the LMS management for you, it may be beneficial to take that on. But remember, the time they spend on LMS is time they’re not spending on other tasks, so be clear about how their time is allocated.
The total cost of ownership
It’s tempting just to look at the upfront LMS pricing, but remember there are other factors such as setup costs, integrations, support, customization, and long-term maintenance. You’ll also want to consider your future. You may, for example, start small but want to scale. An LMS with a low upfront price could end up costing a lot more if you’re paying for critical features or support.
Questions to ask for LMS pricing
Ask yourself:
- How many users will access the LMS?
- How often will they access the LMS?
- Will our user base grow, shrink, or stay steady?
- How frequently will our user base fluctuate?
- Are our training needs continuous or occasional?
- What features are must-haves? (For example, reporting, integrations, mobile access, reviews)
- Do we have internal IT resources, or do we need vendor support?
- What’s our total budget, including setup and ongoing LMS costs?
- Are we training internal teams, external users, or both?
Aligning your organization’s needs with LMS pricing prevents overpaying and ensures your LMS investment meets learning goals.
Understanding ROI and budgeting for an LMS
An LMS can be a powerful tool, but only if the cost aligns with the value it delivers. To make a smart investment, you need to think beyond the LMS price tag and consider the return on investment (ROI) over time.
Measuring LMS ROI
The ROI of an LMS isn’t just about financial gain, it’s about the added efficiency, time savings, improved outcomes, and reduced risk. Some key ways you might see an ROI on your LMS include:
- Lower training costs: Less need for travel, printed materials, or in-person sessions.
- Faster onboarding: A streamlined learning experience helps new employees get up to speed quickly.
- Improved compliance: Automated tracking reduces the risk of non-compliance fines or errors.
- Increased employee performance and retention: Better learning opportunities can lead to higher engagement and productivity.
To measure your ROI, compare the LMS’s total cost of ownership (including licensing, setup, support, and more) with the benefits gained (this can be in hours saved, reduced errors, or improved business outcomes).
Budgeting tips
When budgeting for an LMS, don’t just plan for the base subscription.
Factor in:
- Implementation costs
- Support and maintenance (some plans include this, others charge extra)
- Customizations and integrations
- User growth (make sure it’s scalable if you’ll need that)
- Hidden costs
If your budget is limited, start small. Many platforms offer tiered pricing or modular features so you can add capabilities over time. Always compare multiple vendors. There may be room to negotiate pricing or get discounts.
Remember, the ROI on learning management system prices isn’t always immediate, but with the right setup, it becomes more valuable over time. Even a platform with higher upfront costs may save you money in the long run.
The case for tailored LMS pricing
Each learning management system pricing model has its own advantages and disadvantages. When choosing the right platform for you, it’s important to consider not only your budget but also your goals and future growth.
At Absorb LMS, we know that no two businesses are alike. That’s why we don’t force you into a rigid pricing tier. Instead, we take a tailored approach, working with you to understand your company size, training goals, usage patterns, and budget. Then, we design a flexible pricing model that fits where you are now and grows with you as your needs evolve.
If you want to reinvigorate your organization’s training with a learning platform that feels like it was built for you, book your personalized demo today.
