Category Archives: Rental

Bentley marketers love Autodesk

5 Replies

Bentley Systems marketers are currently taking advantage of Autodesk customers’ distaste for the Big A’s rent-or-GTFO business model.

For any Autodesk competitor, this is a fairly smart move. Autodesk has offered a free kick to its competitors and is betting on them all kicking the ball wide of the net. How accurate is Bentley’s shooting?

In this case, AutoCAD customers are being encouraged to take up MicroStation. Via the Cadalyst Direct opt-in advertising list, I received an email entitled AutoCAD Users, you need options. We listened:


Talk about feeling trapped (which has many Autodesk customers angry), options and flexibility (which Autodesk has removed) and listening (which Autodesk really sucks at) are clearly taking advantage of Autodesk’s self-inflicted subscription predicament.

“Work the way you want to” is only partly true. If you want to work with a pool of network licenses and not get unpleasant surprises in the way of excess-use invoices every so often, the Bentley Select licensing system may not be for you. Bentley has fixed some of the worst aspects of that system but it’s still controversial and unpopular.

It’s also stretching things to describe DWG as a natively supported format with no data conversions necessary. It’s true that MicroStation has supported open and save of DWG for some years, but as a secondary format. It’s not like BricsCAD, where DWG is the primary format and files can generally be seamlessly shared with AutoCAD users. I know from personal experience that DWG files originating in MicroStation cause a bunch of problems for AutoCAD users. I’ve had to write code to work around some of the issues.

Back to the marketing. The email, complete with imagery of a man cramped up in a cardboard box, pointed me to this page with a similarly confined woman:

With the cardboard box theme, it’s a good thing that Bentley isn’t marketing to cats. They would probably make ideal Autodesk customers.

So what’s the substance of the offer here?

If you own AutoCAD perpetual licenses, you can receive credit for the current value of your AutoCAD license toward the purchase of a MicroStation perpetual license.

 
That’s as specific as it gets: “credit for the current value of your AutoCAD license” could mean anything. Autodesk doesn’t sell software any more, so what’s the value of a license that has no current list price? You could have bought your AutoCAD 30 years ago for $2000 and spend $15000 keeping it up to date. How much credit do you get based on that value? 100%? 1%?

It’s an unknown discount off an unknown amount. What are the terms and conditions? Which AutoCAD releases and variants qualify? Do you get to keep your AutoCAD license? (Of course you do, Bentley can’t take it away from you, but they could have said so).

To fill in the gaps you’re expected to fill in a form and presumably get a quote. I bet most people will stop right there and close the browser window. I don’t know about you, but my interest in offers falls off dramatically when I can’t see what’s being offered.

I think Bentley has kicked the ball the wrong side of the post here.

Autodesk subscription offer begins today

Leave a reply

It’s 15 June, which means all of those millions of Autodesk customers with perpetual licenses on maintenance can now give those licenses back to Autodesk and rent them back for about the same amount.

Tempted?

Despite Autodesk’s best efforts to sell this deal as a silk purse, it’s a real pig’s ear.

Artificially raising maintenance prices doesn’t make the subscription changeover deal any more attractive. It only serves to annoy those customers too sensible to throw away their valuable perpetual licences in return for a temporary price freeze and the vaguest of promises not to gouge you in future. History tells you exactly how much that promise is worth.

This can only be described as an astonishingly arrogant ambit claim by Autodesk. It should be ignored to death. Like any sign-up-now-or-lose-out used car deal, walking out of the showroom is your best negotiating tactic.

Remind Autodesk who’s the boss in this relationship. We, the customers, are in charge here. We have the money Autodesk needs. Deprive them of it until they learn not to take us for granted.

Autodesk has released an update to fix the following AutoCAD 2018 problem:

Product users of version 2018 Autodesk single-user subscriptions may experience an intermittent crash. The crash occurs when it has been more than 24 hours since the last successful authorization check and there is intermittent or no internet connection, or the licensing authorization server is unavailable. The licensing authorization check occurs in the background and is completely unrelated to activities the user is performing at the time of the crash.
A fatal error message may be shown by the product. For example:

FATAL ERROR: Unhandled e06d7363h Exception at ee563c58h

 
Links:

Note that this crash only afflicts subscription (rental) single-user (standalone) customers. People with perpetual licenses don’t have to put up with the multiple additional points of failure caused by the subscription licensing system insisting on phoning home every 30 days. Yes, even if you pay for three years’ subscription up front, you’ll still need a working Internet connection every 30 days if you want to keep using the product.

At least, Autodesk has been saying it’s only once every 30 days (as if that wasn’t bad enough). The information provided with this hotfix tells a different story. What is the license server doing phoning home 24 hours after the last successful authorization check? Enquiring minds want to know.

No criticism of Autodesk is implied for providing this hotfix. As always, I commend Autodesk for fixing up problems as they arise. The basis of my criticism is the hotfix being necessary in the first place. It’s caused by Autodesk inflicting unnecessary complication on its customers for its own internal reasons. This one fails the “how does this benefit the customer?” test big-time.

The single-user subscription licensing mechanism has been a crock from day one, especially for CAD Managers of multiple users who have to deal with its onerous requirements. It’s an astonishingly poor design, very badly implemented. Even with this particular crash fixed, it’s still a crock.

ADSK celebrates two full years of losses

8 Replies

Autodesk Reports Strong First Quarter Results, says the press release.

Autodesk co-CEO Amar Hanspal:

Broad-based strength across all subscription types and geographies led to another record quarter for total subscription additions and a fantastic start of the new fiscal year. Customers continue to embrace the subscription model, and we’re expanding our market opportunity with continued momentum of our cloud-based offerings, such as BIM 360 and Fusion 360.

 
Autodesk co-CEO Andrew Anagnost:

We’re executing well and making significant progress on our business model transition as evidenced by our first quarter results. We’re starting the year from a position of strength and are excited to kick off the next phase of our transition when we offer our maintenance customers a simple, cost effective path to product subscription starting next month.

Thanks to this fantastic progress into the exciting new customer-embraced rental-only business model, Autodesk has now recorded eight successive strong quarters of losses totalling $969 million. Another strong quarter like this one will see those losses exceed a billion dollars, and then it will really be time to crack open the champagne.

Here’s how those results look. Green shows profit; red shows loss. The black lines are trend lines. The thick one is linear, the thin one is a 4-quarter moving average.

Here’s an Adobe graph for comparison; it covers a wider date range. The linear trend line is not directly comparable because the Adobe graph includes a recovery phase which Autodesk has yet to enter.

Both graphs represent GAAP results that do not reflect deferred revenue (money that is received but not counted immediately). Autodesk is still making a loss in non-GAAP terms, but a smaller one than shown in the graph. Full details of Autodesk’s financials are available here. Make your own financial decisions based on your own interpretations and/or using the advice of parties better qualified than myself.

Teresa from Autodesk in subscription interview

3 Replies

As a follow-up to the Pixel Fondue video I posted about earlier, Greg from Pixel Fondue conducted a follow-up interview with Teresa Anania, Autodesk’s Senior Director, Subscription Success.

Greg and I asked for your questions for Teresa and I passed on several of my own to him. A word of warning: don’t do as I did and watch through all 54 minutes waiting increasingly impatiently for those questions to come up. They don’t. Anyway, thanks to Greg for conducting this interview and to Teresa for participating.

Greg has now posted the video. Here’s the TL;DW (too long; didn’t watch) version:

  • Greg came up with some suggestions for making subscription more attractive (mainly to entertainment and media customers) and Teresa seemed open to those suggestions.
  • Teresa doubled down on a bunch of the spin that has been thoroughly skewered by myself and many others.
  • There was a rehash of the pricing information we already had a couple of months ago using the same figures Teresa provided in this blog post.
  • The one new piece of information was that somebody who switches from maintenance to subscription will be able to retain access to all prior versions held during perpetual license ownership. This could be interpreted in several different ways and it wasn’t clarified, so I guess we’ll have to wait for something in writing.
  • Despite what Teresa has apparently told some customers on the phone, there was no mention of a less unattractive subscription offer that involves keeping your perpetual license. Indeed, Teresa made it clear that trading in your perpetual license was very much still part of the deal.
  • Future costs for maintenance and subscription were as vague as ever but Teresa thinks it’s pretty impressive that Autodesk put out three years of pricing when asking customers to make a decision with decades-long implications.
  • Teresa wants you to give Autodesk a year to prove how wonderful subscription will be, and is very confident that subscription is for “the greater good”. (Andrew Anagnost also did the “give us a year” thing on Twitter so I guess we’ll see that theme repeated in an attempt to buy more time).
  • She has solemnly stated that Autodesk is never going to gouge its customers and wants to start building better relationships.
  • Teresa wants to hear from you and suggests the Autodesk Moving to Subscription forum as one way of getting in touch.

Here’s the video:

The big Bricsys interview 7 – the applications ecosystem

1 Reply

This is one of a series of posts covering an extensive interview with Bricsys CEO Erik De Keyser and COO Mark Van Den Bergh.

In this post, Erik discusses the Bricsys efforts to work with and assist third-party developers. He does this without being prompted by a question – it’s obviously very important to him.

Erik: For our future growth it’s very important, the ecosystem of the applications we have now. We have talked a lot about what we are doing and about our own products, but we should maybe have spent more time on the importance of the ecosystem. The worst thing we could do is forget the application market for us.

We will not, and we are not able, to develop another HVAC system or a [inaudible] system. We are limited in our resources and focused too much in our development. We believe that if there are five or ten HVAC packages, one in Germany, one in France, one in the US and one in Australia, all those guys understand their local markets and it’s very difficult to take an HVAC package made in America and sell it in Germany. The last thing we want to do is destroy that diversity of the application market. On the contrary, we’re going to encourage it. Therefore we will continuously provide APIs to the application market and invite and encourage them to become more professional. This support is so important. That’s where we can make a difference with many of our colleagues, and we should bring the application market to the same level of professionalism. That’s where we are investing as well. They can use all our systems for free.

It would be a great and a wonderful world if you as a customer if you come to our website or you go to an application website and finds the same systems and buys something, and communicates… if there’s a problem, it’s our problem. He can tell us, the application partner can tell us, if it’s an application problem we will tell them or the customer will tell them. But that kind of trio between the customer, us and the application market is so important. We need that.

We need those kind of applications working with our system. And they are there! For over ten years they have wonderful applications. The point is, they lacked, for the moment, the technology to grow into IFC and the BIM market. That’s what we are developing for them now. Right now we need the apps, and we’re delivering to them. But it’s a very important thing for us, that ecosystem. And again I think that’s another difference between us and many, er, alternatives (laughs).

Steve: Not saying “the A word” there…

Erik/Mark: (laughs)

Steve: It’s something I’ve noticed for years, actually, that you guys look after the third-party developers whereas Autodesk sees them as a revenue source.

Erik: Absolutely. We are convinced we need them. They have to say they need us as well. That’s a very good symbiosis. And the top of that is Intergraph. For us, it’s an application partner, right? There’s scalability a bit more than before.  If Intergraph takes this step, let us invite every other application developer to do the same.

This is the complete set of links to this interview series:

The big Bricsys interview 6 – lean and focused

7 Replies

This is one of a series of posts covering an extensive interview with Bricsys CEO Erik De Keyser and COO Mark Van Den Bergh. In this post, the dynamic duo explain the mystery of how Bricsys can sell smaller numbers of a more capable product than AutoCAD for a fraction of the cost – and still make money.

Steve: It’s kind of interesting that your product is so much cheaper than AutoCAD, and more capable. They’re making a loss and you’re making increasing profits. How does that work?

Erik: I think it has to do with being lean and being focused. I mean, we’re talking about Autodesk, and we’re talking about AutoCAD and Revit and Inventor, but did you have a look at all the products they have? The managers that have to work on those products… I don’t study the detail of their annual figures, but I think it’s obvious that if you have that ton of products, not all of those products are profitable. Of course, not all of them are losing money, but you can’t call it lean.

What we are doing is… we are forced to be profitable. We force ourselves to be profitable. And then we have to be lean. We have four developers that constantly automate our systems, and that four will be extended again. That pays off big-time. It’s an investment; continuous, continuous, continuous. To invent new things where we can improve to be lean as well.

Mark: Stressing again that Autodesk has one hundred products, we basically have one product. We can see for mechanical, we can see for BIM, basically it’s one product.

Steve: It’s the same core.

Mark: It’s the same core, absolutely. So when we started to develop BIM, we used the same toolset as we used for sheet metal; exactly the same. Of course it’s tweaked to be used in BIM or sheet metal, but in the ground it’s the same.

This is the complete set of links to this interview series:

The big Bricsys interview 5 – perpetual licensing and choice

Leave a reply

This is one of a series of posts covering an extensive interview with Bricsys CEO Erik De Keyser and COO Mark Van Den Bergh.

In this post, Erik confirms the Bricsys commitment to perpetual licensing. That’s a statement important enough to preserve, so here’s the recorded audio for posterity.

We also learn what proportion of CAD customers choose perpetual licenses over rental when given fair pricing and the choice. Hint to Autodesk: it’s not 0%.

Steve: Are you committed to the perpetual licensing model?

Erik: Yes, yes. We are committed to choice. If somebody wants another way of licensing our stuff, that’s fine as well. I mean you can hire our stuff, you can pay per month, it’s possible.

Steve: That’s not in all markets, is it?

Erik: We don’t promote it, but it’s possible if somebody contacts us, no problem. It’s choice, and we believe in choice. It’s not up to us to impose how people work with our stuff. But perpetual, it’s fair, I think. Somebody buys software, it’s always been like that, and we have to continue that. And we will continue that. Read my lips! We will continue.

All: (laughs)

Cyrena: Speaking of choice, can you talk about the type and portion of users who go for rental rather than perpetual?

Mark: Of course the vast majority go for perpetual.

Erik: 95% buyers.

Mark: When you see these clients in Russia that have these big oil projects in Siberia for six months or whatever, then it [rental] might make sense. But with the channel… 95, 97, 98% is just perpetual.

But what we see more and more is people are asking about it [rental] more and more, because of course in the Autodesk world there is no other option. So of course people just want to compare apples with apples.

Steve: So they’re just asking for the numbers?

Mark: Yes, for the numbers, “What would it be?” That’s the feeling that we have, ultimately when they make a decision they’re going to go for perpetual.

Erik: Because the price is acceptable as well, I think. It’s not that high a price for a substantial amount of software, so it’s not a problem.

Mark: Our price levels are completely different, of course. It’s affordable.

This is the complete set of links to this interview series:

Clearing up the Autodesk rental / subscription / maintenance naming confusion

3 Replies

Some people are confused by Autodesk’s naming terminology about subscription, maintenance and rental. This is entirely Autodesk’s fault, because it took a name (Subscription) which had a long-established meaning (including perpetual licensing) and used that name (but without its initial capital) to mean the opposite (no perpetual licensing).

There was a brief period, only last year, where the S word meant both things at the same time and differentiation between the opposing meanings was achieved using different prefixes.

Confused yet?

I’m not sure whether it’s kinder to view Autodesk doing something so obviously confusing as merely incompetence in communication or a deliberate attempt to confuse and deceive customers and/or the share market. Or maybe it was an inspired choice and I’m too obtuse to comprehend its genius. Choose whichever explanation you prefer.

In an attempt to clear things up, but at the risk of confusing matters further, Autodesk’s naming history goes something like this. The years shown below are approximate and some of them varied for different products and markets.

Year
 Name for perpetual license + pre-paid upgrades Name for rental
1997-2001 VIP Subscription Program –
2001-2003 VIP Subscription Program Rental
2004-2012 Subscription –
2013 Subscription Rental
2014-2015 Subscription –
2016 (briefly) maintenance subscription desktop subscription
2016- maintenance subscription

The current rental regime, which has run under two names to date but is currently called ‘subscription’, is the third attempt Autodesk has had at rental. The first two attempts failed in the marketplace because the vast majority of customers prefer perpetual licenses.

The big Bricsys interview 4 – thank you, Autodesk

Leave a reply

This is one of a series of posts covering an extensive interview with Bricsys CEO Erik De Keyser and COO Mark Van Den Bergh. In this post, we learn that Autodesk’s move to all-rental has helped drive BricsCAD sales higher and continues to do so.

Cyrena: Backing up just a step to sales, were you able to track any impact on your sales numbers with the chronology of Autodesk’s announcements of ending perpetual? Did you see an effect that you could map to that?

Erik/Mark (together): Yes.

Erik: We see that especially with large companies. I hear it from Mark always!

Mark: That’s what I wanted to explain this morning too, although we have an indirect sales channel, we have our resellers at work out there, especially with the large deals, we are involved always. So there’s always one of our guys, a business development manager together with the local sales person in touch with those larger corporations.

In the last few weeks, we have received tons of emails from large corporations; of course it’s hard to disclose them, but… [names a corporation]. It doesn’t mean they will switch right away, but we have meetings where they say that, “Our contract with Autodesk ends in July, August, whatever, that’s the time we will not extend it. We will not renew it, we will not go to subscription, and we are looking for alternatives.” These are really big, big, corporations. So yes, yes, we see an impact.

Erik: When it comes to alternatives, and with all respect to our colleagues [competitors], we are not the only alternative, but I think we are in a good position. If you see what we have to give people a perspective beyond AutoCAD, well…

If we would only be an AutoCAD clone, and AutoCAD stops further development, it would mean the clones stop further development more or less as well. And all of a sudden the market is going to 3D mechanical, 3D BIM, etc., then it’s a problem. I think that’s where we can play an important role.

The DWG market, the DWG community, if they really want to move on slowly, slowly (and everyone makes his own choices about staying on 2D AutoCAD-based, fine as well), but at least there is a growth path. And I see that BricsCAD is the only product that goes in that direction. All the other alternatives more or less stay around what Autodesk is presenting, with a few differences here and there.

But it’s not really mainstream that there is investment in R&D or really a big jump of other stuff than just being compatible with AutoCAD. It makes a difference.

This is the complete set of links to this interview series:

Minority interest in keep-your-perpetual Autodesk subscription idea

1 Reply

It’s undeniable that the vast majority of Autodesk’s customers don’t want to give up their perpetual licenses to sign up with Autodesk’s subscription (rental) model. I’ve gone through the evidence for this in an earlier post.

To bring that up to date a little, here are the final results from the poll “Autodesk is ending the sale of perpetual licenses. This is: (Good/Bad)”:

People are clearly attached to their perpetual licenses, regardless of what Autodesk does to manipulate prices.

A while ago I floated the idea that Autodesk might possibly come up with a better offer; one that lets you keep your existing non-upgraded perpetual license when signing up for subscription. I wanted to know if there was any more interest in that, so I wrote a post around that and created another poll, “Would you be interested in switching to Autodesk subscription if you could keep your old (non-upgraded) perpetual license? (Yes/Maybe/No)”. Here’s how the results ended up:

While the level of interest in this idea appears higher than in Autodesk’s current unappealing offer, it’s still not great. It seems most people don’t just want perpetual licenses for the sake of it, they want an escape route: the option to stop paying and keep playing, regardless of file format and OS compatibility issues. That means they want those perpetual licences to remain current.

The upshot is that Autodesk is going to find it very difficult to push most of its existing customers onto subscription, no matter what the offer.

Autodesk’s revolting customers are evaporating

2 Replies

The revolting customers themselves aren’t evaporating, of course. They remain solid and are still as irate as ever. It’s just that the appearance of outrage is gradually fading away on the Autodesk Community forums.

As mentioned before, forum moderators have been busily vacuuming up threads from all over the place and moving them to the Moving to Subscription forum. Some time in the last week or so, that forum became less visible. It’s no longer listed among the bold links on the right pane under Subscription Management, but for now can still be found (if you look hard) in the list of 96 forums. Or at least you can get to the page above that forum, from where you can click on another link.

As it’s now so hard to find, I’ll help Autodesk with its sincere desire to be transparent about its extortion scheme, er, wonderful discount offer by making the link a bit easier to find. Here it is:

Autodesk Moving to Subscription forum

Don’t mention it, Autodesk!

Oh, and the first time I tried to get in as a signed-in user, I got kicked out to the top forum list level. Don’t give up, try again and it should work.

From the beginning, I’ve had no doubt that the main idea behind the forum is to keep customer dissent neat and tidy in one easily-hidden place. It will almost certainly lose its final link in due course, then it will be made read-only and merged into semi-oblivion, just like the last one. When I dared to suggest such an outrageous thing, an Autodesk moderator accused me of being a conspiracy theorist.

Well, melt my steel beams with jet fuel, look what’s happening! Who would have thought it?

I’ll be sure to let you know when each of the final evaporation stages occurs. If you happen to notice before I do, please let me know and I’ll pass the information on to my readers.

Hot tip for Autodesk

10 Replies

Hey Autodesk high-ups, I’m sorry you’ve been having so much trouble persuading your customers to throw away their perpetual licenses and throw themselves on your perpetual mercy. It’s clearly difficult to persuade technical types to do dumb things like rent your software at enormous and ever-increasing prices. I feel for you. But there’s an answer.

Find dumber customers.

Lots of them. And fast, before the stock market notices that you’re no Adobe and we’re not buying it. Sorry, I mean not renting it.

Look no further! Simply buy this company, discard the product when you’re bored with it (you’re very familiar with that process) and get hold of the customer list.

Sell subscription software to those people. They’ll have no idea what they’re renting or why, but that doesn’t matter. They’ll buy anything that’s pretty, hip, now, connected, and preferably organic. They will commit to perpetually shelling out large sums just to keep using it, no matter how poorly it performs. They’re rich and dumber than rocks. All of this makes them ideal customers for you.

If you’re a bit strapped for cash at the moment, just have a word with the investors (including Google) who pumped $120M into an Internet-enabled $700 (sorry, now $400) machine that squeezes expensive pre-squeezed juice out of DRM-protected short-lifespan bags, and manages to do it slower and noisier than you can do it with your bare hands. They’re even dumber than the customers, so squeezing money out of them will be easier than squeezing juice out of a bag when the Wi-Fi’s down.

This is a perfect fit for you, Autodesk. It has everything you need to ensure mission-friendly proactive synergistic compatibility on a going-forward basis. It’s disruptive. It looks good. It’s an overpriced, poorly functioning product. It has on-point (but pointless) compulsory connectivity. It ties users into paying whatever you ask, for ever. And best of all, it connects you to a collection of completely clueless cashed-up customers.

Thanks to @internetofshit on Twitter for making me aware of this and other hilarious Internet of Things (IoT) idiocy. Examples:

Enjoy!

Dissecting Dieter’s perpetual points

22 Replies

I like Dieter Schlaepfer, we’ve been arguing for years.

Dieter and I have never met in person, but online we go back to the CIS:ACAD CompuServe days of the early 1990s. Dieter’s a good guy who has done a splendid job with AutoCAD documentation content for decades. He is genuinely interested in improving the product and customer experience, and has done a great deal to do so over the years.

Dieter’s responsible for the most-commented post on this blog, AutoCAD 2013 – An Autodesk Help writer responds with 164 comments and was a heavy contributor to the 95 comments on the recent AutoCAD 2018 – why did the DWG format change? post.

If you read the comments here, you’ll know that Dieter is the only Autodesk person brave enough to put his head above the parapet and enter into discussions here in recent times, even though he’s not doing so in any official capacity. Autodesk’s PR people give me a wide berth and the Autodesk view would be completely unrepresented here if not for Dieter. He’s prepared to put his hand up and say, “But what about this?” when it’s an unpopular viewpoint and nobody else is prepared to say it. Props to Dieter for that.

Among Dieter’s many recent comments, he outlined 12 considerations in the rental v perpetual argument. Myself and others have been having fun eviscerating his tortured pub analogy, but his more serious arguments deserve a more considered response than can be comfortably provided in a comment, hence this post.

Let’s take Dieter’s considerations one by one. Bear in mind I’m approaching this from a long-term Autodesk customer point of view. You may look at things differently, and that’s fine.

1. Cost – if a rental, lease, or membership were low enough in price, almost everyone would do so (at a dollar a month, heck, I’d lease my shoes)

Fantasy argument. If Lear would hire me a private jet for $1 a month, sure, sign me up. The reality is that rental costs more, except in the short term. That’s why companies rent things out: to make money. That’s why Autodesk is doing it; it’s an attempt, however hamfisted, to make more money. On cost, rental loses.

2. Business model, terms and conditions, and their consequences

Vague. But given the terms and conditions attached to Autodesk rental (standalone users must use a terrible licensing system) and the consequences (software stops working the instant you stop paying), rental loses big-time here.

3. Quality of fulfillment – this is to your point

Not sure what Dieter means here. ???

4. Tax consequences

This varies from place to place. I can get a 100% write-off whether buying a perpetual license, maintaining it or renting it. I may want to get a bigger write-off sooner, or not. Neutral.

5. Opportunity cost – by tying up a lot of cash, what potential opportunities do you lose?

Depending on a business’s cashflow and other circumstances, this is a possible valid argument. However, only in the short term. Because rental costs more in the long term, it costs you more in potential opportunity in the long term. Overall, rental loses.

6. Financial accounting – rental, lease, or membership costs can easily be assigned to each project and billed to each customer

If I don’t have the need to do that, it’s irrelevant. But even if that’s the way you need or prefer to do things, it’s still only partially true that rental can be a benefit. Let’s say you have won a project that is planned to take 9 months and rent Autodesk software for a year: it costs you $3000 and you pay up front (because you’re not insane enough to pay Autodesk’s monthly rental prices). You finish the project in 10 months. You use that software for other smaller projects that crop up during that 10 month period, and after it’s over. Quick, how much of that $3000 do you apportion to each project? See, it’s not as simple as it appears.

It’s really not difficult to have perpetual license software costs handled in the same way as overheads and other long-term costs that can’t be directly attributed to a project. You’re not going to be able to sack your accountant thanks to software rental. Neutral.

7. Flexibility – you can easily increase or decrease the number and types of licenses for several (not just one) products

Ah, flexibility. Let’s say I’m convinced by Dieter’s other arguments and convert my perpetual license to rental under the current so-called “discount” offer. In doing so, I throw away my flexibility. I can’t ever stop paying or my software stops working. Down the track I may not need that license for a while, but even then I can’t hop off the rental train because if I do that and then hop back on, my software costs will treble (roughly – it varies).

As for the several products thing, Autodesk has been pushing customers into suites and collections where a high price is paid for a block of products. Can you drop back from a collection to a product or two for a while, then back to other products or up to a collection again? Sure, Autodesk is very flexible. Just forego your “discount” and pay an astronomical increase, no problem.

Autodesk has been progressively removing its customers’ flexibility for decades and will undoubtedly continue to do so as long as it thinks that will make more money that way.

So please don’t come the rental=flexibility argument with me. On flexibility too, Autodesk’s rental loses.

8. A truly perpetual software license requires you to maintain obsolete hardware and old operating systems, and discourages the adoption of new technologies

No it doesn’t. A non-upgradable license might do that, whether perpetual or otherwise. That doesn’t apply to perpetual licenses under maintenance. It didn’t even used to apply to perpetual licenses not under maintenance. Whose fault is it that perpetual licenses not under maintenance are no longer upgradable? Autodesk’s. False argument.

9. Perpetual licenses put most of the financial burden on new customers rather than spreading it more fairly between all users

Actually, with perpetual licenses the financial burden is much more fairly spread. What costs more, developing a product from scratch or maintaining it? Perpetual license purchasers pay a higher amount for the initial purchase, just as the developer pays a higher amount for the initial development. The developer is fairly rewarded for providing the product for the customer to use. Following that, the developer is fairly rewarded for maintaining and improving it.

But I really hope you’re not trying to convince people that Autodesk is price-forcing customers onto rental in order to be fairer to them, because I think incredulity would be the appropriate reaction. False argument.

10. Perpetual software licenses create “a long tail” of product versions, making data sharing between users more difficult

Perpetual software licenses that are maintained do no such thing. If a vendor provides good value for that maintenance payment, then people will maintain the software. Autodesk maintenance value for money has been dreadful in recent years, leading to people dropping it. Improving Autodesk’s performance in that area would reduce the length of the tail. Making maintenance value for money even worse by racking up prices will lead to people dropping it and sticking on old releases much longer. Autodesk’s rental push is lengthening the tail, not shortening it.

Incidentally, there is a new benefit for subscription customers with multi-user (network) licenses. Guess what? Five releases are now supported rather than four. Yes, Autodesk rental is literally lengthening the tail. False argument.

11. Perpetual software licenses encourage users to use less secure software and operating systems in a time when cybercrime and espionage are mushrooming

See 10 above. False argument.

12. Providers of perpetual licenses have less incentive to support long-time customers than providers of rental, leased, and membership business models do

Absolutely wrong. This is literally the exact opposite of observed reality.

You know what model really provides an incentive for vendors to improve the product? Perpetual licenses with optional paid upgrades. With the perpetual/upgrade model, if there’s no improvement, there’s no ongoing income. But that model was too much like hard work. Easier to just remove our options over the years to manipulate customers into paying more and getting less. Autodesk priced that model out of the market and then killed it off because it wanted to get people paying for just using the software rather than as a reward for improving it.

It’s proven by history. The closer Autodesk got to the all-rental model, the worse the rate of improvement became. As an improvement incentive, rental loses.

There you go, Dieter. Rental loses on five considerations and wins on none. And I’m being generous by considering points 10 and 11 as neutral.

Feel free to add your own observations on perpetual v rental. If you want to have a go at Dieter’s arguments or mine, go for it. I just ask that you play the ball, not the man.

Simplifying CAD Management the Autodesk way

7 Replies

According to Autodesk, one of the benefits of subscription (rental) is simplified administration. To prove it, Autodesk has provided a simple guide for CAD Managers called The Software Administrator’s Guide to Autodesk Subscriptions – How to Set Up, Install, and Manage Your Software and Users.

It’s 18.7 MB and 78 pages long.

Don’t worry though, this simple guide helpfully includes a simple guide on how to read it.

Among other things, this eBook provides handy hints on how subscription’s simplified administration regime for standalone licenses requires you to pre-emptively name all your users, set them all up with Autodesk accounts and define what software each is allowed to use. There’s a note to say that your Internet connection needs to be working at the time of installation (obviously) and also every 30 days (less obvious) or you won’t be able to use the software.

The guide describes how you can simply go online to Autodesk Accounts (assuming it’s up), and switch those permissions around when Bert is away on site and Ernie needs to hop on his PC at 6 PM to make a quick change before a drawing goes out. It mentions how Ernie will be sent an email with a link to follow so they can sign up before using the product. The CAD Manager is encouraged to check with Ernie to make sure it all worked, and check online to ensure Ernie’s sign-in went according to plan.

Make sure you get in early tomorrow morning before Bert’s shift starts so you can switch the user permissions back again. What? You planned to have the day off? Don’t you understand that your job has been redefined by Autodesk? I dub thee “not a team player”.

Don’t complain, because the new procedure is clearly much more simple than the old-fashioned perpetual license method. You know, the one which involved the far more complex procedure of Ernie logging on to Bert’s PC and using the software, then Bert logging on and using it the next day. How did we ever cope before Autodesk’s magnificent management enhancement?

If the huge job efficiency boost provided by this simplified new method doesn’t have CAD Managers throwing their perpetual licenses at Autodesk in a subscription-hungry frenzy, I don’t know what will.

Simplifying CAD Management is alive at Autodesk.

Autodesk customers are still revolting

10 Replies

I described before how customers are outraged by Autodesk’s attempt to price-force them onto subscription (rental). That’s still happening. The Autodesk Community forum moderators are still vacuuming up threads and Ideas submissions and moving them to the Moving to Subscription forum, which despite its obscurity is still active with some threads now having hundreds of posts.

Other discussions in various non-Autodesk locations are extending over many pages of comments. Almost all comments are highly critical of Autodesk. A large portion of these customers say they are abandoning Autodesk. Many are discussing the specific competitors’ software they are moving to.

In addition to the Autodesk forum staff confining commentary to a quiet corner, another way of keeping the public noise down is by directing people to talk to their resellers. Yesterday, I did just that. The rep who came to see me is a good guy from a great reseller and I was not unkind.

Autodesk obviously knows it’s hard to sell such a bad deal and is pushing its resellers hard to get with the program. They are being briefed and provided with PowerPoint presentations to help sell the deal. My reseller says he’s had to deal with “many angry customers” and feels like the meat in the sandwich. He did his very best to present the deal in its best light, but the poor guy is too honest to make it sound good. He has my sympathy.

There were some differences between the numbers he provided and what I’ve described based on Autodesk information. The major pieces of new information I gleaned (assuming my reseller is right) were:

  • For people who surrender their licenses and switch to subscription, the cost that’s locked in for the first three years is 5% more than maintenance, not the same price.
  • After the three-year lock-in, the year four subscription price rise will be about 15%.
  • After that, nobody knows.

The net effect is slightly worse for subscription than it looked before the meeting, but not hugely so. It’s not worth redoing my graphs.

Switching to subscription is still just a really bad deal that’s being presented as a good deal by comparing it with another deal (maintenance) that’s being artificially worsened. Sorry, but I’m not just comparing it with Autodesk’s other deal. I’m also comparing it with the deals provided by Autodesk’s competitors. According to that comparison, both Autodesk’s deals are shockingly poor. The same happens if I compare Autodesk’s subscription deal with rental success-story Adobe’s pricing.

I explained to my reseller the problem with surrendering perpetual licenses. Autodesk is requiring a decision to be made with permanent, irrevocable consequences, based only on short-term information. He said the message from Autodesk is that further information isn’t going to be forthcoming because, “No other company is going to let you know its prices five years in advance.” My reply was that no other company is expecting me to give away what has already been paid for.

Last week, I had a telephone conversation about an Autodesk rep about this issue. Among other things, I told him:

You’re asking me to give you my balls in a bag in the hope that you won’t squeeze too hard.

 
It ain’t happening.

New Autodesk subscription idea – any interest?

3 Replies

Let’s say Autodesk came up with a new offer for customers currently under maintenance. Let’s say you could switch to subscription (rental) with the same price as maintenance, locked in with no increases for three years. In addition, you get to retain, but not upgrade, your perpetual license.

Let’s say you’re on maintenance which is up for renewal later this year. You currently have a perpetual license of AutoCAD 2018. If you accept this offer, you will always retain that AutoCAD 2018 license. You switch to subscription and pay the maintenance amount for one to three years. Your subscription fee is guaranteed to rise by no more than 20% total by year five.

As long as you continue to pay subscription, you get access to new releases (2019, 2020, etc). If you decide to no longer renew your subscription at any point, you can no longer use the new releases, but you can still fall back on using your perpetual license, which remains as AutoCAD 2018. The use of the software would be subject to the usual fair use restrictions, e.g. during the subscription period you can’t use AutoCAD 2018 on one PC while using AutoCAD 2019 on a different one.

Would you be interested in such an offer?

I’ve added a poll, so please vote and feel free to comment on why you would or would not be prepared to switch under those circumstances.

Would you be interested in switching to Autodesk subscription if you could keep your old (non-upgraded) perpetual license?

  • Yes (24%, 32 Votes)
  • Maybe (25%, 33 Votes)
  • No (51%, 67 Votes)

Total Voters: 132

Loading ... Loading ...

Please note that this offer is entirely hypothetical. It arose from a recent telephone conversation with a non-Autodesk person. I have no inside information that suggests Autodesk is considering such an offer.

New Autodesk subscription offer to perpetual license holders

2 Replies

Don’t get too excited. Autodesk’s recent attempt to price-force perpetual license maintenance customers onto subscription (rental) remains in place, unchanged and just as unappealing as before. If you’re one of those customers, there’s nothing new here of interest to you.

This new offer, at 30% off the normal but extremely high subscription price, is at first sight even less appealing than the approximately 60% saving that the above offer provides. But it’s aimed at different customers, and there’s the remote possibility that such customers might find it worthwhile.

The new offer is called FY18 Q1 Autodesk – Global Field Promotion and is aimed at bringing into the rental fold those customers who hold old perpetual licenses that are not on maintenance. If you have an old AutoCAD Release 14 lying around that has never been upgraded, or an AutoCAD 2007 license where you allowed the maintenance (then called Subscription) to lapse, you can trade it in for the 30% discount on a wide range of subscription products. You need to surrender the perpetual license, and you need to pay up front for three years of subscription. Read the FAQ for details.

Three years of subscription at only 30% off is actually really expensive. Depending on what product you go for, it could work out about the same as a perpetual license cost back when Autodesk used to sell software. Despite that substantial investment, you’ll be left with nothing whatsoever at the end of the three years. You will then be expected to wear a huge increase in rental costs when the 30% discount wears off. It works out to a price jump of about 43%, plus whatever price rises there may have been in the meantime.

Excited by this offer? No? Gee, you people are hard to please!

Don’t dismiss it out of hand, though. If you meet all of the following conditions, you should still consider this offer:

  • You have an old non-upgraded eligible license lying around.
  • You’re never going to want to use that license ever again.
  • You have an absolute need to rent one of the Autodesk products on offer, and would otherwise be paying 100% rather than 70% of the huge subscription fees.
  • You can afford to pay those high fees in advance for three years.
  • You’re definitely going to need that rented software for more than two years (otherwise it works out cheaper to rent at 100% for 2/3 of the time).
  • You can budget for a huge price increase at the end of the three year period, assuming you’re going to use the software long-term.
  • You don’t think Autodesk is going to come up with a more attractive offer later.

Maybe the Autodesk execs think this is going to be perceived as an attractive offer, but if they do there’s a fair bit of self-delusion going on. I fully expect this campaign to fail to live up to Autodesk’s expectations, and much better offers to follow later, in order to try to tempt the remaining hold-outs. No guarantees, obviously; it’s your money and your gamble.

Having had a good look at what Autodesk execs have been telling the stock market, I’ve been expecting this move. Old perpetual license holders have been identified as a target market. However, I was expecting the move to come later than this, and I was expecting the terms of the offer to be much more attractive. Are perpetual license converts thinner on the ground than Autodesk expected? Is Autodesk getting desperate for cash to make this quarter’s numbers look better than they otherwise would? Wouldn’t surprise me.

Ask Teresa from Autodesk your maintenance and subscription questions

4 Replies

As a follow-up to the Pixel Fondue video I posted earlier, Greg reports:

Since then Teresa Anania (Teresa from the letter) has contacted me and has agreed to do a pixelfondue livestream and answer some questions people may have. So…if you want to ask Teresa something directly post your question here and I will send it to her. I obviously can’t guarantee that I will ask (or she will answer) all questions. Teresa is (to her credit) reaching out to customers in a more personal way here – and maybe we can help her understand our feelings about AD’s move to subscription, especially how it pertains to current license holders.

Teresa Anania is Autodesk’s Senior Director, Subscription Success. It is indeed commendable that Teresa is prepared to step out of the Autodesk PR safe zone and field questions and comments from real people in an environment outside her control.

If you want to ask Teresa a question, hop over Autodesk forum and reply to Greg’s post. I’ll let Greg know about this post here too, so if you reply here he should see it.

ADSK v ADBE – a tale of two graphs

10 Replies

I’m no financial analyst, so I’ll just leave these graphs here for your own interpretation. They show the profit/loss numbers for two software companies beginning with A that have abandoned perpetual license sales and gone all-subscription (rental).

Among other significant differences, one company went with very low rental prices while the other has extremely high rental prices. How have these differing strategies played out for Adobe and Autodesk? Green shows profit; red shows loss.

Adobe moved to the all-rental model earlier than Autodesk. The Autodesk graph therefore covers a shorter period than the Adobe one. Feel free to slide the Autodesk one along to the point you think best matches the equivalent point in the Adobe timeline.

The black lines are trend lines. The thick one is linear, the thin one is a 4-quarter moving average. The linear trend lines are not directly comparable because of the different timeframes covered (the Adobe one includes the revenue recovery stage which Autodesk has yet to enter).

Neither of these graphs reflect deferred revenue (money that is received but not counted immediately). Full details of Autodesk’s financials are available here. Make your own financial decisions based on your own interpretations and/or using the advice of parties better qualified than myself. For now at least, the stock market loves what Autodesk is doing, even if Autodesk customers don’t. I just found the comparison interesting.