Trebling upgrade prices was not enough for Autodesk

A blog post from BIM person Gregory Arkin contains a number of confidently-made statements about what Autodesk intends to do with its upgrade and Subscription pricing model. If the information is correct, the news is all bad for customers. The prices for both upgrade and Subscription are getting jacked up substantially. In fact, for upgraders the pricing (70% of full whack for the cheapest upgrade) will be completely non-viable and you’ll effectively be forced onto Subscription. This goes beyond the trebling of upgrade prices that Autodesk’s Callan Carpenter spent some time defending here two years ago. The link in that post to the relevant Autodesk page doesn’t contain any pricing specifics other than the vague statement “save up to 20%”, but I’ll take Gregory’s word for it.

Gregory sees this business of upgraders being hunted to extinction as something that Subscription customers should have a good laugh about, but he’s wrong. Resellers can have a chuckle, but Subscription customers should mourn the lack of choice for customers. It means customers are no longer able to compare Subscription with any kind of sane upgrade pricing and make a decision about the best option for them. This lack of internal ‘competition’ is not even worth a snigger, because it inevitably means Subscription prices shooting up. Autodesk has racked up Subscription prices already and will do so again next year. For those customers who have fallen for the ‘free’ upgrade-to-suite offers, their Subscription prices will be higher again. With everyone on Subscription, Autodesk will just keep pushing up prices indefinitely. From Autodesk’s point of view, there is no down side to this; tie people in and the gravy train goes on for ever.

There are various terms in common use for this kind of thing. One is price gouging. Anybody who has ever booked a hotel near a big sporting event or bought drinks at a nightclub will be familiar with the realities of businesses doing this whenever they can get away with it. It’s part of the free market and generally perfectly legal, no matter how unpopular it makes the business. However, it only works when competition is effectively absent and customers are left with no realistic alternative but to pay up. Autodesk obviously thinks it is in such a position. Is it right? Sadly, history says it probably is.

Edit: This post originally stated that Gregory is a reseller. He has informed me that this is no longer the case and I have edited the post accordingly. My apologies to Gregory for the misstatement.

25 comments to Trebling upgrade prices was not enough for Autodesk

  • James Maeding

    When you look at the competition, let’s say Bentley, they take a hard line on subscription too. Its all products on select or none, and those that are not on get “given up” as if you never owned them (last time I checked).
    But Bentley has awesome network licensing and policies that make it a pleasure to deal with. The fact is, Autodesk has arguably the best basic cad program, and should raise prices to what the market will bear. What we need to do is get Bricscad souped up with .net add-ons, so there is some kind of middle ground competition. Acad is still a bit more polished than the clones, but at some point you just need basics to get production done.

  • Lance W

    I think what this might do is force companies to examine what they produce as a final product and how much more “improvment” is needed in the design/documentation process over the next 5 years or so. Right now the cost of subscription is worth the “maybe next year I’ll get an improvment” thing that we get now. I have always been a big fan of subscription but honestly if it jumps up too much I’ll need to reexamine that.

    In my current job I would have a serious discussion with the boss about if we needed to stay on subscription and if I thought the next 4-5 versions would actually help us in production.

  • ralphg

    Autodesk found a way to pay for the “free” cloud.

  • Peter S

    What’s needed are vendors who build what customers need, not features designed to force customers into buying the next version. It used to be that new versions brought truly useful functionality that users needed. Now new versions are smokescreens for more obfuscated file formats to force users to upgrade for compatibility. Whether it’s gouging on upgrades or charging for subscriptions, it amounts to the same thing. An inwardly-focused vendor who cares more for their earning reports than they do for their customers.

    Interesting the Russians are building a national CAD system. Not a bad idea.

    • ralphg

      Not quite a national CAD system. The government is funding a Russian 3D modeling kernel, on which Russian firms can build their software. Which is a bit odd, since ASCON of St Petersburg already has a made-in-Russia kernel.

  • One the one hand, playing “nice” with free student versions, free consumer products (123D line, Fusion, iOS apps) and on the other hand enforcing subscription. Once everybody is on subscription, there might be no need anymore to have a yearly new version, as this is not a reason for users to stay on subscription anymore… there won’t be any choice anyway. So no pressure to provide subscription-only benefits.

    Come to think of it, maybe that is not even such a bad thing… Back to a three-year major release cycle (with some bug-fixing updates in between). But the end user will pay for it. And has to wait a while for new features.

    As an educational user, we have a (non-free) classroom version of most AEC products, that is stalled at release 2010. Even then, subscription was more expensive than pay a new suite every now and then (e.g. not every single year).

    The sad thing is that this model is being used by other companies too.

    A notable exception is McNeel with Rhino, which has a really long release cycle, no enforced subscription formula, fair update policies.

    • McNeel has always struck me as a good company to do business with. I’ve always had excellent technical-related communications with them (thanks, Dale!) and I’m not even a paying customer.

  • R. Paul Waddington

    Interesting, it is to me, to see a discussion Autodesk’s “unfair” pricing in the wake of a previous post in which it appeared – to contributors – it was appropriate to provide Autodesk FREE feedback. Information Autodesk’s management/staff use to build their careers and Autodesk profits; facilitated & paid for by those same contributors. The word gullible springs to mind or am I just being un-kind?

    More importantly it must be remembered Autodesk is not a democratic organization. Autodesk’s management & employees have a duty to the share holders to maximise the amount of moneys received from “customers” whilst minimising their costs. Whilst continuing to levy subscription payments Autodesk could, and probably should, slow the “improvement” their products and stop shipping all except new product for a prolonged period. This is a real possibility if subscriptions reach “saturation”. Surprisingly, this could be a cost effective strategy for customers as well as more profitable for Autodesk.

    It is customers who are responsible for the pricing we continue to pay for Autodesk software NOT Autodesk. Whilst we as customers, collectively, sit on our hands and continue to contribute to Autodesk nothing will change; Autodesk personnel may read these comments but, it will bring about no change until customers realize they must form into a group large enough to wield some influence.

  • Michael Wilkinson

    Time for people to look to alternatives to Autocad. I now use Draftsight which is free, and find that their community forum is well suported by users and Dassault staff. I still have a copy of Acad 2004 which is kept “for emergencies” but I only use it when I need to use a lisp routine (about once a month).
    Bricscad sound like a suitable alternative, too – I haven’t tried it yet.

    • R. Paul Waddington

      Micheal, your not on your own that’s for sure. A number of my “customers” have now switched to Draftsight for their work: saving thousands of dollars a year and in doing so improving their profitabilty. This is, of course, just what CAD software is meant to do – improve customers’ “experience” ;-)

    • Draftsight is great for sure. And for people that are using other software for 3D like Solidworks it is a great as a program to use when getting in dwg files from external clients. I just don’t know about using it as my only program. I sure would miss 3D.

  • JGerth

    I don’t think I could consider Bentley a competitor to Autodesk. Once upon a time they were, and it was great seeing each trying ti do a better job than the other. But now they seem more like coop-etion than competition. Real competion weems to have fallen onto Graebert, Bricsys, the ODA and ITC.

    Now that Bentley is dropping out of the race for excellence, Autodesk’s primary competion is older versions of AutoCAD. There’s no incentive to produce excellent software, & those of us who fell for the subscription program are learning that pre-paying for upgrades guarantees poor quality.

    Especially with Autodesk’s unpalatable decision to require paying customers (and their staff!!) to relinquish control of their personal data to Autodesk, it’s increasingly attractive to jump ship. Work-alikes are more than adequate for 99 percent of customers (and yes, I just pulled that number out of my elbow). My copy of 13 is still in the box, unopened, and I’m still debating over to break the seal or return for a refund.

  • All:

    I’ve been saying it for over a decade: The ONLY way to win is to buy ADSK shares – PERIOD.

    If all 1,000,000 suffering users buy just one share per week (today about $30 each), in 2 years, we will collectively own 100,000,000 shares, more than enough to take control of the company (239,000,000 shares outstanding).

    We should form a new ‘AOGI’ – Autodesk Owner’s Group International, whose ultimate goal is to make Autodesk a user-owned company. From there, we can change the release cycle from every year to every 4 years, and demand that the software work as advertised.

    Be warned, however: The stock will no longer pay cash dividends – indeed, as an investor, you may not see any increase in the value of your 100 shares of stock, once this stupid subscription (‘leech’) business model is gone. The dividend will not be direct profit, it will instead be lower levels of aggravation at work, higher productivity, fewer hardware upgrades, less re-training. In fact, such a user-owned company would benefit employers so much that they too should become investors – the ROI is easy to see and quantify.

    In fact, it may be inevitable that the new User-Owned Autodesk become a non-profit – it would save tremendously on taxes, of course, and Autodesk would finally become a good corporate citizen. As you are doubtless aware, in their scramble to become a “billion dollar company” (Carol Bartz, 199?), they have ended up costing the industries they “serve” many times that in utterly unrecoverable time, wasted on ‘upgrades’ (aka ‘musical icons’), patches, increased hardware requirements, training costs, and reduced productivity. The 1,000 employes of Autdesk should not dictate the fate of the millions of users who continuously send them cash, only to have most requests for improvement completely ignored.

    • R. Paul Waddington

      Plawton, I agree.

      I also have often spoken in similar ways; indeed also floating the idea of what I refer to as co-operative CAD. That is a CAD developer owned and operated in the form of a co-operative similar to existing businesses in the agricultrual arena.

      I’m with you on this one; the trick is now who and how to get it going?

      • Many folks are intimidated by the very thought of taking over Autodesk, but those folks need to realize that it is the nature of a corporation to simply keep charging more, until they start losing customers to competitors (which is how they tell ‘what the market will bear’). Autodesk’s strategy has been to buy up as many competitors as possible, to minimize the possibility of losing customers – so there is no check or balance on their charging structure.

        Having 1,000,000 users take over Autodesk would directly benefit far more people than are currently benefitting from their operations, and the indirect benefits would potentially be significant as well. For example, other companies that run roughshod over their customer base would see the takeover and likely be inclined to improve their practices.

        Organizing 1,000,000 user/owners would take a few key elements:

        1. Centralize the effort around an existing autodesk user organization, like AUGI. They could start a new Owner’s division, AOGI, which would function as a central clearinghouse of data and act as an access point for all who want to become owners. For many years now AUGI has been the central gathering point for opinions about and wishes for the software, so they have the best view of what the users really want and need.

        2. An alliance would need to be formed with a third-party professional stock brokerage house to manage the purchase of stock. Folks could set up the automatic purchase of two shares of the stock every payday.

        3. Attorneys would need to be involved ….

        Folks who want to own autodesk would buy their shares through the allied stock brokerage, and upon doing so they would fill out a 50-question survey about what they want the software to do – NOT who they want to be president of the corporation and fly in the corporate jet. With this survey, owners would have the right to ‘vote’ for product performance issues, and those votes would be carefully tracked (with complete transparency) and the products would be adjusted accordingly. The more shares you buy, the more times you get to submit your survey/vote.

        At the outset, the buyer must agree to keep the stock for a period of time (24 to 48 months?), and if an owner wants to sell his stock after that time, he can only sell it to other owners or back to AOGI.

        The new owners would also have to agree that the goal of stock ownership is NOT to make cash profit – the goal is to provide better software solutions for the various industries served, including his own. Owners also need to understand that the company may become a non-profit at some point, to more effectively achieve that goal.

        If such an organization were set up by January of 2013, then marketed through blogs and the myriad non-autodesk websites discussing their software products, it is likely that controlling ownership would be acheived within three years.

        Does anyone know the directors of AUGI?

  • All we have to do is not buy the upgrade for a few years.

    Autodesk will drop the price

    I upgrade every 3 or 4 years, sooner if the price is lower.

    For my own part I really hate the grey screen the paper grid and the toolbar/dashboard

  • James Maeding

    While the competition develops, what Autodesk is doing is to make its tools more of a risky investment. You buy a few seats needed when a bigger project comes along, and there is risk that you will not need them when the project is over, or is put on hold.
    Meanwhile, the cost per seat is going up.
    So the way most people handle this is to minimize risk, which means minimize what autodesk products you buy and depend on. This is tough for companies that do not have R&D money to find cheaper solutions.
    You talk about shattered trust, there is none left on the Autodesk front. Its the wild west and you better be sure the features you think will work, actually do.
    The odd thing is the technical people at Autodesk are great to work with, and do care, but they live under non-technical pressures. The end result is businees people encouraging us to rely on their expensive products less.

  • I have been reading, with a lot of interest, the recent posts.
    The company I work for is small. Only 2 engineers. The compnay itself is 168 years old. AutoCAD has been the only program we use. We draw in 2D and have toyed with looking into 3D but not seriously. We have a lot of drawings as you could imagine.
    The problem is what do you do? The owners probably won’t even look at the cloud that AutoDesk is talking about. It seems like AutoDesk doesn’t care about all the small companies that use their product. It almost seems that they sre going to do what “they” think is best for them no matter what the outcome.

    • Michael Wilkinson

      Don, why not have a look at Draftsight? It is FREE, is almost identical to Autocad (but no LISP in the free version), and the learning curve for someone swapping over from Acad is virtually nil. It comes in Windows, Mac and Linux versions. The early versions had a few bugs (especially with printing) but these seem to be largely sorted out now.

      • James Maeding

        I took a look at the draftsight page, I did not understand how it made the transition from acad easy. It looked like a different interface, and I could not find info on how it did xrefs. Did I miss something?
        I like to have a list of acad alternatives on hand for people that ask.

        • Michael Wilkinson

          The interface for Draftsight is virtually identical to Acad prior to the ribbon. The XREF command (and insert block command) is also the same as Acad, apart from the dialog boxes being slightly different. One thing that I do miss from Draftsight is that dynamic blocks are not supported.
          I have also tried Doublecad, but found that it was just too different from Acad to be useful as a replacement.

          • James Maeding

            ok, I’ll have to try it sometime.
            The ribbon issue is no problem since my favorite command is Ribbonclose.
            I have kept an open mind too, I continually find the ribbon(s) in acad and other progs to be only occasionally useful. I much prefer the combination of pulldowns and toolbars, which stay put visually. The way ribbons switch images when you switch tabs is totally unsuitable for production. Its no good for beginners either because the software companies think the ribbons are self exclamatory, so then do a lousy job with explaining workflows. Plus, you cannot fit everything on a ribbon, so certain items really become hidden then.

  • Thanks Michael & James for all the good information. This may be a good alternative for us. I will check it out.

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