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Autodesk Evolution On a visit to Autodesk’s headquarters in downtown San Francisco, we quizzed the company’s AEC development team on near and long-term development plans and got some candid answers. by Martyn Day
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t a recent investor day in San Francisco Autodesk announced it was ending the ability for customers to upgrade their software without being on Subscription. This was described by Andrew Anagnost, Autodesk senior vice-president, industry strategy & marketing, as being an expected move having “conditioned” customers to the fact that Autodesk Subscription was the most cost-effective way of owning Autodesk software, together with getting access to additional services. Undoubtedly this will come as a shock to many who, despite the financial incentives of Subscription, have decided to upgrade only when they actually wanted to. Autodesk’s introduction of time-limited Rental offerings has in some way replaced the need to go through the old upgrade process — the latest version is always available for download and at a lower cost than updating an old release. From the figures I have seen, perpetually owned software on Subscription (full cost of software plus yearly cost) versus yearly rental takes about three years of ownership to benefit buying a full license over renting. This option also alters the accounting for engineering tools, capital expenditure versus operational expenditure and may 26
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Upgrades and business model Autodesk’s business model has been a constant transition. When AutoCAD was all the company offered, it could be two or three years before a new release came out This moved to yearly releases with Subscription being the cheapest way to stay up to date, with corresponding escalating financial costs to update for those that stayed behind. In this model the ‘sweeper’ was introduced; which forced those who preferred a longer cycle to upgrade or face buying a whole new copy if they wanted to protect their investment. In the past four years Autodesk has been steadily moving away from its reliance from this three year upgrade cycle revenue to annual Subscription. To push Subscriptions more, Autodesk produced ‘Suites’, offering even more software for a relatively small yearly fee. The final act is the complete removal of ‘Upgrade’ as an option. I suspect this decision will be met with lots of wailing and gnashing of teeth by customers who feel ‘herded’ by Autodesk’s business model but now with ‘rental’ there are other aspects to Autodesk’s offerings which help mitigate this decision.
depend on how and when you want to write off your software against future tax liabilities. Admittedly it does make long term decisions of ‘buy to own’ or ‘rent’ a bit of a complex equation and who knows what the future holds? Autodesk is keen to point out that unlike Adobe, previous and future full license acquisitions of Autodesk software are still perpetually owned — albeit nonupgradable if not on subscription. For Autodesk there is also distinct danger in this move, in that should many customers move to rent their software, they will have much greater freedom to move elsewhere, with less of a conscious historical and ongoing investment to maintain. The latest release is always there for rent when required and there is no big ‘joining fee’ of buying the software. It will also help keep Autodesk’s development teams focused to deliver useable new functionality and services, which from release to release can be a little hit and miss and only deliver small portions. Autodesk will be more vocal on these changes in the coming months, and I am sure the devil will be in the detail. For now, with the news that upgrades will be no more as of 2014, every firm should be weighing up the tactical benefit of using Autodesk Rental licenses. www.AECmag.com
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