It’s nothing like Dassault’s disastrous we’re-moving-you-to-the-Cloud FUD campaign against [...]]]> Autodesk recently made a big announcement about its Cloud initiatives, and reactions have been all over the place. Some people can barely contain their breathless excitement while others are outraged to the point of passing out the pitchforks. Why? It’s pretty much business as usual.

It’s nothing like Dassault’s disastrous we’re-moving-you-to-the-Cloud FUD campaign against its own product, SolidWorks. There’s no hint here of AutoCAD (real AutoCAD, I mean, not “AutoCAD” WS) being moved to the Cloud, or anything as radical as that. (Yes, I know there’s a limited experiment along those lines but that’s nothing to do with this announcement). It’s just a collection of relatively minor changes to Autodesk’s existing on-line services, collected together to make a newsworthy press release.

(As an aside, I must say this was a much more worthwhile announcement than the ridiculously over-hyped DE8.16N thing. So I was supposed to get excited about a routine upgrade of a product I have already been using for months, on an OS I don’t use, when the upgraded product is still half-baked just like the first underwhelming effort? Fortunately, I didn’t get sucked in by the pre-announcement build-up so I wasn’t disappointed, just amused when the truth was revealed. Autodesk PR, please don’t cry wolf so often; keep the hype in reserve for the hypeworthy stuff.)

Back to the Cloud thing, and putting aside hype and horror, here’s the stuff that has just happened:

• Autodesk Cloud documents lets anybody store up to 1 GB documents on-line, or 3 GB if you’re a Subscription customer. This isn’t new, but until recently it was an Autodesk Labs project called Nitrous. The infrastructure is provided via Amazon and Citrix.
• AutoCAD WS has been updated to integrate its storage with Autodesk Cloud documents. Remember, WS isn’t anything like real AutoCAD, but rather a limited on-line DWG editing tool. There’s a WS iPhone app, but that’s not new.
• There’s an Autodesk Design Review iPhone app for reviewing DWF files you’ve stored in Autodesk Cloud. It won’t do DWG; use WS for that.
• There are several cloud-based services that are available “free” to Subscription-paying users of a small subset of Autodesk software, mostly Revit and Inventor-based suites. They are: 
  • Inventor Optimization
  • Cloud Rendering
  • Green Building Studio
  • Conceptual Energy Analysis
  • Buzzsaw (now bundled with Vault Subscription)

  AutoCAD users need not apply for any of these services.

So some of Autodesk’s on-line services are now being provided only to Subscription customers, and one is offered in improved form for Subscription customers. There are two obvious reasons for this: tie-in and revenue.

First, Autodesk wants its customers tied to the Subscription gravy train, if you’ll excuse a fairly awful mix of metaphors. Offering Subscription benefits like this is preferable to some of the much less pleasant arm-twisting that has been happening recently (e.g. trebling upgrade prices). Is it too much to hope that Autodesk has learned that offering carrots to its customers is a better strategy than threatening them with sticks?

Second, Autodesk needs to start making money out of this stuff somehow. For some years, it has spent several fortunes on buying and developing on-line services and then given them away for nothing, usually as Labs projects. This obviously can’t go on for ever, but just slapping a charge on these services wasn’t going to fly. Bundling Cloud services up with Subscription is a way of easing people into paying for them, and this is something I expect to be expanded in future, for example with AutoCAD WS. Once that’s been established for a few years, it wouldn’t surprise me to then see Subscription for at least some of the services split off, so you’re paying for Cloud services explicitly. By then, enough customers may consider them to be worth paying for and they may therefore survive beyond the short term.

Will it work? I’m not sure. Time will tell which of these services will thrive and which will die, and such uncertainty is one of the many reasons real-world customers aren’t excited about getting their heads in the Cloud. I don’t intend to make use of these services (I’m not even allowed to), so I’m not too bothered what happens to them. Like the vast majority of Autodesk customers, I will just carry on using conventional software in that old-fashioned 20th century way that just happens to work very well. Autodesk will go on providing its software in that way, because that’s what most customers will want for at least a while yet, and Autodesk can’t survive on wisps of Cloudy revenue.

Move along, people, nothing to see here.

After I managed to overcome Autodesk’s obstructive download manger and download AutoCAD 2012, it became available on the Subscription site (when that site wasn’t running unusably slowly). Or it became kind-of available. Here’s [...]]]> Note: this post is not an April fool’s joke. It may be ridiculous and hard to believe, but unfortunately it’s all true.

After I managed to overcome Autodesk’s obstructive download manger and download AutoCAD 2012, it became available on the Subscription site (when that site wasn’t running unusably slowly). Or it became kind-of available. Here’s what is actually available:

• AutoCAD 2012 Multilingual 32 bit
  Download File Size: 2,080,558,319 bytes (1,984.2 MB)
• AutoCAD 2012 English Korean Traditional-Chinese Simplified-Chinese Win 64bit
  Download File Size: 2,240,915,999 bytes (2,137.1 MB)

These file sizes are roughly double those of the AutoCAD 2012 English files I’ve already downloaded from the trial page and installed. The 32-bit English file is 1,144,011,680 bytes, or 55% of the size of what the Subscription site is trying to offer me.

Why? Because the Subscription downloads contain three bonus Asian language packs. It has apparently escaped Autodesk’s notice that Australia is an English-speaking country, and that the ability to install a Korean version of AutoCAD 2012 isn’t going to be spectacularly useful here. Duh!

There was a a distribution fiasco last year when Autodesk couldn’t make up its mind which AutoCAD 2011 language variant Australian users were supposed to use. This resulted in weeks of delays, uncertainty and disrupted shipments. This year, there’s less uncertainty. Somebody has made a firm decision about what we’re getting, right from the start. What a shame it’s the wrong one, and it makes Autodesk look utterly clueless.

Just in case you’re wondering, the AutoCAD 2012 English from the trial page installs and works fine, correctly detecting that I’m in Australia and presenting the correct legal information. The installation also registers and authorises correctly using the serial number provided on the Subscription site. No problems there, then.

What, then, is the reason for the massive download bloat? Is it really just stupidity, or is there some legitimate reason for it? I’m informed that installing the English version of 2012 in Australia may cause some problems with Migration when upgrading to 2013. I am unconcerned about this for two reasons. First, I’m sure migrating from 2012 English to 2013 English will work just as well here as it does elsewhere in the world. it’s not as if the Migration utility has to invert the bits or anything for Down Under users. Second, I have avoided Migration anyway since AutoCAD 2006, when “improvements” rendered it effectively unusable to me.

I have a request for follow-up information arising from this interview. I hope you can find the time [...]]]> You may remember a month ago I raised the question What proportion of Autodesk customers really are on Subscription? Shortly after that, I sent Autodesk Subscription VP Callan Carpenter these questions following up on the interview:

I have a request for follow-up information arising from this interview. I hope you can find the time to provide some answers.

Preamble: Several people have called into doubt your assertion that the simplified upgrade policy affects only a tiny minority of your customers (you seemed to imply a figure of around 3% non-Subscription customers, with 1.5% who upgrade within a year or two). My own calculations based on Autodesk’s latest published financial results indicate that of upgrades represent 21% of the combined income from Subscription and upgrades, which is 7 times greater than the impression you gave in your answer. Please see this post for more discussion.

Questions:

• Please clarify in as much detail as possible exactly how you arrive at your figures.
• A percentage is derived by dividing one number by another; what exactly are you dividing by what to come up with 1.5%?
• Please explain why your statements appear to contradict Autodesk’s own published figures.
• How large is Autodesk’s total installed base?

Other points of dispute have been raised by various commenters, which I have paraphrased here. I invite your response.

• Because Autodesk made Subscription cheaper than upgrading, it is no surprise that upgrading became less popular. This doesn’t indicate that customers prefer doing business in that way, merely that Autodesk made it the cheapest alternative.
• If the idea of Subscription is such an attractive proposition, why do you need to sweeten the deal with tools that you don’t allow upgraders to have?
• Your assertion that the 12-month cycle is driven by the product teams is incorrect. It was chosen for business reasons and the product cycle was forced to fit the Subscription model.

After a few follow-ups, I received a response yesterday. I reproduce that response here verbatim and without comment:

My sincere apologies for the delay. I have been travelling quite extensively, and this response has been sitting in my drafts email folder, and I just kept getting sidetracked with customer matters.

Nonetheless, I appreciate the opportunity to respond to some of the feedback you received after our discussion last month. During that first interview we discussed, among other things, the rationale behind the Simplified Upgrade Pricing program. I argued that SUP impacts only a small subset of our customers, and quoted figures to support the case. It appears those figures have been challenged by a few of your readers who feel their experience is different. Is it possible that both points of view are right? I believe it is.

By my prior statements I do not mean to suggest that the vast majority of all customers are on Subscription. Autodesk has a very large base of customers that has grown over the past 28 years. The subscription program as it exists today is only about 8 years old, so we had 20 years to develop a large base of customers, many of whom are not on Subscription. (Yes, there were forerunner programs like VIP, but they were structured quite differently and never generated an appreciable amount of business.) This is important because the SUP program only really impacts those customers upgrading from one and two versions back, which is a very small percentage of the already small upgrade revenue. Subscribers and customers upgrading from four or more versions back see no change to their pricing, and customers upgrading from 3 versions back see either no change or a very nominal one (up or down) depending on their specific product or country.

Most of the non-subscribing customer base does not purchase upgrades one or two versions back. In other words, most of these customers either haven’t bought anything from us in a long time, or when they do, they fall into the 98.5% of the revenue that includes upgrades from three or more versions back.

History is one thing, but the current trend line is another. For 8 years the Subscription program has coexisted with the Upgrade program. During that time our customers have been free to chose either strategy for keeping their technology current. Based on the results, their choice was clear: the majority of customers buying over the past few years have opted to leverage the Subscription program to stay on the latest technology in the most cost effective way possible. Only a few have elected to stay current through one and two version upgrades. The rest upgraded from older versions – three or more back. Of course Autodesk still offers all those choices going forward, albeit with a slimmed down price sheet.

There is one last point that I would like to make: While we believe Subscription is the most cost effective way to stay on the latest design technology, there is much more to the program than cost savings. Direct access to Autodesk product support specialists, Advantage Pack© bonus features, and free software for home use are just some of the value-added aspects of the program. In short, we are committed to an ongoing, continuous reevaluation of both the cost and benefit components of the Subscription value equation in order to make it an attractive option for as many customers as possible.

Thanks, again Steve for allowing me the time to speak with your readers.

…there is a very small fraction of our revenue that comes from upgrades at this point in time.

We’re down to very low single digits of customers who upgrade, and of those only half of those upgrade 1 or 2 [...]]]> In my recent interview of Autodesk Subscription VP Callan Carpenter, he made these statements:

…there is a very small fraction of our revenue that comes from upgrades at this point in time.

We’re down to very low single digits of customers who upgrade, and of those only half of those upgrade 1 or 2 years back. So we’re talking about approximately 1.5% of our revenue that comes from customers upgrading 1 and 2 versions back.

…[customers who upgrade] 1 or 2 [releases] back, a very small percentage of our customer base, less than 2% of our customer base that was buying those upgrades.

Others are calling those numbers into doubt. Deelip Menezes (SYCODE, Print 3D) estimated the numbers of AutoCAD users not on Subscription at 66% (or 43%, depending on which bit of the post you read), by counting the AutoCAD releases used by his customers and making assumptions about their Subscription status from that. That’s an extremely suspect methodology, as I pointed out:

Your numbers don’t really tell us anything about Subscription v. upgrade proportions. All they tell us is that large numbers of people wait a while before installing a new release. We all knew that, surely.

However, Deelip’s post did prompt me to point out this:

…there is a fair point to be made about people on earlier releases who have hopped off the upgrade train altogether, or at least for a significant number of years. How would they be counted in Callan’s figures? They wouldn’t exist at all, as far as his income percentages are concerned.

Owen Wengerd (ManuSoft, CADLock) asked a random sample of his customers and came up with 82% of them as non-Subscription customers. He also noted that he could come up with a 3% non-Subscription figure if he cooked the books by selectively choosing a convenient time slice. Owen doesn’t state the numbers in his sample, or indicate (or know) how many of the non-Subscribers are also non-upgraders.

I’ve added my own poll (see right) just to add to the mix.

Nothing we can hang a conclusion on yet, then. But Ralph Grabowski (WorldCAD Access, upFront.eZine) uses Autodesk’s own figures to point out that upgrade revenue has increased 18% and Subscription revenue only 7% in the last year. I’m not qualified to perform an analysis of the 2011 Q1 fiscal results, but I can find the figures listed as Maintenance revenue ($195 M) and Upgrade revenue ($51 M). That looks to me like about 21% of the Subscription/upgrade income is coming from upgrades.

Also, according to the published figures, Autodesk has 2,383,000 customers on Subscription. If that represents about 97% of customers, does that really mean Autodesk has only about 2.5 M customers? If I’m looking at these figures in the wrong way, feel free to put me right.

So, what’s the truth? What proportion of Autodesk customers really are on Subscription? 3%? 21%? 43%? 66%? 82%? I’m going to ask Callan a follow-up question about this and will report back on what he has to say. In the spirit of this post, I’ll be asking him for a lot more detail. Watch this space.

SJ: The 12-month cycle that you have for most of your software has come under some criticism from all sorts of people, especially me. Once [...]]]> This 5th post concludes the Callan Carpenter interview series. For the record, this interview was done in real time over the phone, with no prior notice of the questions.

SJ: The 12-month cycle that you have for most of your software has come under some criticism from all sorts of people, especially me. Once you have your customer base practically all on Subscription, what’s the incentive for the 12-month cycle to persist?

CC: In what way have you criticised the 12 month cycle?

SJ: In that it damages the product. In that there’s not enough time to release a properly developed product within that 12-month cycle. This is an observation that many people have made going back many years. That’s the basis of the criticism; not that, “Oh no, you’re giving me more software”. Well, there are people who complain about that but I don’t think that’s a valid criticism. I think the valid criticism is that it damages the product. A poll that I ran on my blog asked that question: is the 12-month cycle damaging the product? The answer was a very emphatic yes from the readers of my blog. I know that’s not a scientific survey but it fits in with other viewpoints I’ve seen expressed in various places.

CC: The question was, do we intend to continue to do that?

SJ: Yes. Once you have effectively have your customers on the Subscription model, so that you’re no longer internally competing with the upgrade model, do you really have to have a 12-month release cycle?

CC: Well, I think it’s a very interesting and valid question, do we need to have a 12-month upgrade cycle? I know there are customers who simply cannot absorb technology at that rate. But it’s a bit of a two-edged sword, in that if we go to a 24-month cycle, for example, do we get criticism for not providing enough value for the Subscription dollar or is it going to be viewed as a positive because it’s improved overall software quality? If we stay at the 12 months, we get the reverse argument. Maybe we’re providing the value that customers are paying for with Subscription, but what are we doing to software quality? I think that one of the things we have to look at over time is alternative delivery mechanisms. You’re going to start to see, for example, software delivered (as we have started to) with things available as Software as a Service. That obviates a lot of the issues associated with those release cycles you’re talking about. Your quality can go up, it’s a lot more controlled environment, and the customer doesn’t have to deal with an install, then another install and another install. So I would imagine you would see augmentation of our desktop products with products like that, that sort of move away from the complexities of the constant need to try and absorb new technology.

I think that it would be a very interesting thing to do on a scientific basis to understand whether customers prefer us to go a 24-month or an 18-month, or you-pick-the cycle. I think internally, your question about is it motivated by some kind of internal competition with upgrades, absolutely not. Upgrades, just look at the numbers, that battle’s over, so there’s no internal competition in that regard. The thing that we do have to deal with, which I think is endemic to any engineering creative group, is software engineers like to write software. They’re not motivated by issues of Subscription, or upgrade, or anything else. What they do is create product. We would literally have to rein those guys back if we wanted to go to a longer cycle. They’re the ones leading the charge on that, not the Subscription program.

SJ: So you’re saying that the development teams like the 12-month cycle?

CC: They do. It brings a certain discipline to them on the one hand; on the other hand, it’s kind of what software writers do, they write software.

SJ: Right, but they can write software that takes 12 months and isn’t finished or they can write software that takes 18 months and is finished. If I were a developer I know which I’d prefer.

CC: I hear your point. I think something we have to always look at is what’s the right balance between functionality and trying to build a bridge too far and to get it released. That’s something I know the product division managers are looking at constantly. Again, it’s absolutely not motivated by Subscription. Like you, I’ve heard customers say, “Would you go to 24 months?”, so I’d be happy to deliver that for them in some cases. But it’s really up to the product divisions.

See also
Callan Carpenter interview 1 – Autodesk and social media
Callan Carpenter interview 2 – upgrades a tiny minority
Callan Carpenter interview 3 – the cost of complexity
Callan Carpenter interview 4 – enhancing the program

SJ: There is always the fear that once you have all of your customer base on Subscription, you’re not going to need to offer those benefits any more. Can you assure people that that’s not going to be the case, that you are going to keep being [...]]]> Part 4 of 5 in this series.

SJ: There is always the fear that once you have all of your customer base on Subscription, you’re not going to need to offer those benefits any more. Can you assure people that that’s not going to be the case, that you are going to keep being “nice” to your customers?

CC: Absolutely. I think my team and I spend as much time and brain energy trying to figure out how to enhance the program as anything else. Our goal is to make Subscription a compelling value proposition; to make it not only cost-effective but valuable in other ways. An example would be the Advantage Pack program. We had a history of Subscription including extensions and other little technology bonuses for subscribers. But last year, we said we’re going to do something different with that. One of the problems with our historical technical Extensions program is that it was optional for product line managers to either participate or not. It was optional for product line managers to localise those Extensions in languages other than English. It was optional to make those Extensions incremental install as opposed to requiring a full reinstallation of a product.

So last year, we turned a lot of our product development upside down and produced the Advantage Pack with a whole new set of requirements. A product had to be localised, it had to be incremental install, and the top 26 or 27 product lines all had to participate in delivering that value. We saw the impact in the form of a 150% increase in the downloads of that Advantage Pack. That’s an example of trying to improve the value, and you’re going to see some additional fairly significant moves on our part on the Advantage Pack this year that are going to have a lasting impact on Subscription and how people look at it. Next year, we plan to improve it yet more, and so on. I don’t see any end in sight. It’s a competitive world out there and the only way you survive is by continuing to improve and grow and add value, otherwise you get replaced, and nobody’s immune to that. No company, no market.

SJ: You said that there was a 150% increase in Advantage Pack downloads. What was increasing over what?

CC: Prior to Advantage Pack, we had the Extensions program. If you took all the Extensions for the various products for the prior year, the last year we had Extensions (2008), and you compare that to the number of downloads of the Advantage Pack, it’s a 150% increase of Advantage Pack downloads over Extensions.

SJ: But there had been no Extensions for AutoCAD since the very early years, right?

CC: No, there were Extensions for AutoCAD. For example, there was an AutoCAD Extension 2 years ago for PDF writing. This year, I don’t want to give the cat away, but you’re going to see some very interesting technology that is being made exclusively available to subscribers for no additional charge, that I think they will find quite interesting.

SJ: I was scratching my head to think of Extensions; after the initial burst when they first came out there was practically nothing. There was a trickle of them that came through for the various verticals, but I’m struggling to think of AutoCAD ones between, say, 2002 and 2007.

CC: I think you’re highlighting a potential example of a challenge that we had with the old Extensions program in that it was optional for product line managers to participate or not. Today, that’s not the case and that includes AutoCAD. They do participate in the Advantage Pack program and will continue to do so, along with Revit, Inventor and 20-odd other products that are our biggest sellers.

SJ: So that’s a permanent fixture as far as you’re concerned? The Advantage Packs aren’t going to disappear?

CC: Not unless we can come up with something better.

SJ: So there are no other nasties you have planned for customers? You’re not going to, for example, change the EULA so that Subscription is going to have to be paid otherwise your licenses don’t work any more?

CC: No, at this stage we don’t see any change to the perpetual license model if that’s what you’re referring to. We have a hybrid model, which is different from some industries. Some industries are all perpetual, some industries are all term-based licensing, we are still perpetual, plus Subscription or maintenance. I don’t see that changing. It’s hard to predict 50 years into the future, but we have no plans for that.

See also
Callan Carpenter interview 1 – Autodesk and social media
Callan Carpenter interview 2 – upgrades a tiny minority
Callan Carpenter interview 3 – the cost of complexity

SJ: In one of my blog posts, I was pretty cynical about one of the phrases used in the press release: “the streamlining of upgrade pricing based on feedback from customers and resellers”. Was I wrong to be cynical about that? Did your customers really ask for [...]]]> Part 3 of 5 in this series.

SJ: In one of my blog posts, I was pretty cynical about one of the phrases used in the press release: “the streamlining of upgrade pricing based on feedback from customers and resellers”. Was I wrong to be cynical about that? Did your customers really ask for upgrade prices to be increased to some nice round number?

CC: What our customers have asked for is simplified purchasing. We have a very complex price book and it leads to thousands of prices items, maybe tens of thousands when you have all the permutations across all the different geographies in which we sell software. A lot of that complexity came from having multiple-step upgrades, multiple-step crossgrades. There is a cost to maintaining that kind of a system. So our resellers certainly were asking for simplification and streamlining explicitly. Our customers were asking to find ways to make it easier to do business with Autodesk; can it be less expensive? One of the costs of doing business is maintaining a very complex pricing scheme as we have in the past. So while we may not have a customer say, “Gosh, I wish you would simplify your upgrade pricing” explicitly, it is implicit in trying to offer an easier path to buying and less cost in the long run because we’re not maintaining a very complex system that only serves a very small percentage of our customer base.

SJ: So there’s a real cost associated with this. Can you put a number on that as a percentage of the cost of the upgrade? Is it 1%? 10%? Is a big amount that customers need to be worried about?

CC: You know, I’ve never tried to put it as a percentage of the cost of an upgrade and tried to figure it out. Some of these things are a little difficult to untangle, but you can look at the complexity of your back office software, the staff that it takes to maintain it, the cost of the releases; our customers are simply aware of our releases of our software products, but they’re not aware of the fact that of course we have numerous releases of our internal systems for tracking and matching assets, price books, things like this. All of those have a cost associated with them. People, software, systems and so on. I haven’t ever tried to calculate that as a percentage of the cost of an upgrade, but it’s certainly a real cost nonetheless.

SJ: So let’s say it was costing people 5%. Why didn’t you reduce the prices by 5% instead of trebling them?

CC: Well, we didn’t really treble the prices. What we did was we said, remember for 3 or more versions back, the price is essentially unchanged. It may be a couple of hundred dollars more expensive or less expensive depending on the product and the market for the third version back. The big change was really in 1 or 2 back, a very small percentage of our customer base, less than 2% of our customer base that was buying those upgrades. It didn’t really make sense to us to maintain the complexity for that small percentage of our customer base.

I think that it’s an interesting point that we’re in because if you go back far enough in time, and you don’t have to go back that far, about 8 or 9 years I guess, with Subscription we could have been arguing the other extreme. We could have been arguing that, “My goodness, why are you making me pay for upgrades?”, and this Subscription thing either didn’t exist or it was very, very expensive. And then we designed Subscription to actually be very cost-effective, to be the most cost-effective to get access to this technology. So it’s an interesting inversion. I think it would be an interesting mind-experiment to wonder what would happen if we took away our Subscription pricing tomorrow, which is typically somewhere between 10% and 18% of list price of the product, depending on the product and the market. If we took that option away tomorrow, I think we actually would create tremendous havoc in the marketplace, because that’s really where the majority of our customers are today in terms of buying our software.

SJ: There are people who do still want to buy upgrades, those who want to have that choice. Do you understand the mindset of people who say, “I want to see what the product is before I pay for it”?

CC: I can appreciate that sentiment. I’d like to believe that our 25+ years of history has generally shown that our pace of advancement is generally up and to the right. Certainly there have been hiccups along the way; some releases have more functionality than others, but generally it’s up and to the right. But the customers who wish to do that, I certainly can appreciate that and that’s as good a reason as any for why we’ve kept upgrade and Subscription pricing as opposed to one or the other, because it gives customers a choice. For those customers who tend to want to wait and see, again the vast majority of them are doing it 3 or more versions back. If they’re doing it less than that, they’re on Subscription, by and large. So they still have that option. Even with the simplified upgrade pricing, I think it’s important to point out that we announced it over a year ago, and even today, if a customer goes off Subscription, they have up to a year to retroactively attach it. So the hope is with that timeframe, questions of, “Is the economy going to turn back up?”, those sort of things will be answered. If it takes 2 years for those questions to be answered, well then you’re back to 3 versions back pricing or more, and that has hardly changed, if at all. So I think that those kind of customers that want to wait and see what the product is going to be before they buy it, they have that option.

You have to also realise that there are also other benefits that come from Subscription in addition to the upgrade. Access to our product support teams, access to prior version usage, home use licenses, the prerequisite to global floating network licenses and other types of benefits, those are a very significant proportion of the value.

See also
Callan Carpenter interview 1 – Autodesk and social media
Callan Carpenter interview 2 – upgrades a tiny minority

SJ: Is there anything specific you want to say about what I have written in my blog?

CC: There are a number of things we can do to put Subscription questions and Simplified Upgrade Pricing into context. I think the first thing we need to recognise is [...]]]> Part 2 of 5 in this series.

SJ: Is there anything specific you want to say about what I have written in my blog?

CC: There are a number of things we can do to put Subscription questions and Simplified Upgrade Pricing into context. I think the first thing we need to recognise is that there is a very small fraction of our revenue that comes from upgrades at this point in time. For the last 8 years or so, our customers have fairly well self-selected to either prefer to be on Subscription and have the latest version and technology available to them, or to not do that, in which case they tend to upgrade 3 years or more after the current release. We’re down to very low single digits of customers who upgrade, and of those only half of those upgrade 1 or 2 years back. So we’re talking about approximately 1.5% of our revenue that comes from customers upgrading 1 and 2 versions back. And so I think there’s clearly been a natural selection, a natural fallout over time of customers choosing; do I prefer to be on Subscription or do I prefer to pay for an upgrade?

If you look at the real impact of upgrade pricing, the real impact is the customers who prefer to upgrade from 1 or 2 versions back, that’s a very very small percentage of our business. For those who are 3 versions back or more, there’s really no change at all. For subscribers, which is the majority of the customer base, there is no change at all either. I just wanted to start by kind of putting that in perspective.

I think the other thing we should look at is that the history of the Subscription program is one of actually creating more value over time. It started out as simply an upgrade path, a cheaper path to upgrade than buying upgrades. Over time we’ve added more value in terms of additional support options, additional licensing benefits that come with Subscription and later on this year you are going to see things like a very enhanced Advantage Pack program, which started last year.

So as I read through a lot of the blogs, I was struck by a kind of lack of perspective on how the program has grown over time and how very few of our customers were actually buying upgrades.

SJ: There are some of your customers that don’t have any option but to be on Subscription, aren’t there? There are some markets and some products where Subscription is compulsory, right?

CC: No, with a few exceptions, I don’t believe we have any compulsory Subscription left. There may be a few in some emerging countries where software piracy is a particular issue, but generally speaking, the vast majority of our customers have the option to either be on Subscription or not.

SJ: For some years here in Australia, if you wanted to upgrade to the latest release, Subscription has been compulsory. Is this unique to Australia or does this happen elsewhere?

In Australia we do have a unique experiment, but that is fairly unusual. No other country comes to the top of my mind.

SJ: Is this experiment going to continue or does the point become moot now that the price of upgrading has been increased?

CC: I don’t think we’re going to be changing the way we do business in Australia.

See also
Callan Carpenter interview 1 – Autodesk and social media

Disallowing bug fixes for non-subscription customers is reprehensible, no matter what kind of spin is put [...]]]> I’m still looking for your questions about Autodesk Subscription and upgrade policies and pricing. No matter what you think about that, you have to admit that Autodesk’s current policies are less anti-customer than those inflicted on SolidWorks users.

Disallowing bug fixes for non-subscription customers is reprehensible, no matter what kind of spin is put on it. Not only that, it’s clueless. So you’re annoyed at Autodesk for whatever reason and are looking for alternative software from a company that doesn’t mistreat its customers? You know not to even bother looking at SolidWorks, don’t you?

Edit: more relevant links and customer comments from Devon Sowell and Matt Lombard’s blogs.

So, let’s follow this up. Let’s say, just hypothetically, that you had an Autodesk high-up in front of you who was willing to answer questions about Subscription and upgrade policy. What would you ask? [...]]]> My post on Autodesk’s new upgrade pricing regime attracted a fair amount of comment, much of it critical of Autodesk.

So, let’s follow this up. Let’s say, just hypothetically, that you had an Autodesk high-up in front of you who was willing to answer questions about Subscription and upgrade policy. What would you ask? Please add a comment here with your question. If you want to do so privately, use the Contact link at the top of the page. I would ask that you keep your question civil, relevant and reasonably concise. Other than that, anything goes, so let’s have ‘em.

I’ve done this before and did get some answers. Although not all of you liked the answers, they were better than no answers at all. I can’t promise that all your questions will be answered this time, but I’ll see what I can do.

Here’s my experience so far. As a Subscription customer, I can see a bright new Get Your Upgrade button, and if I click on that I get an AutoCAD 2011 English link to click on. So far so good. [...]]]> Apparently, AutoCAD 2011 has been available for download for the best part of a day.

Here’s my experience so far. As a Subscription customer, I can see a bright new Get Your Upgrade button, and if I click on that I get an AutoCAD 2011 English link to click on. So far so good. If I click on that link, I get only this:

Error Message
You are currently not authorized to download from this Account.

I have contacted my reseller to try to work out what is going on. In the meantime, I’d be interested to know if any of you are having the same problem.

What has your download experience been like? Did it work? If so, how long did it take? Any issues with Autodesk download manager or your own? Did you do a Subscription download or the trial version? Did you choose to receive a DVD? Are you located outside North America? Any feedback is welcome.