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Saturday, July 7, 2012

Autodesk Price Increases, Promotions and a Million Laggards

As I'm sure you're aware of by now, Autodesk is increasing prices next
month and again next March. I'm still puzzled as to the timing of all
of this considering the continued construction and design depression.

Customer: What's the price of your ground beef?
Butcher: $3.00 per pound.
Customer: Three dollars per pound! but the butcher down the street
sells it for $1.50 per pound!
Butcher: Why don't you shop there?
Customer: I did, but he's out of it.
Butcher: Tell you what—when I am out of it, I'll sell it for $1.00 a pound.

Autodesk raises the prices and then, like clockwork, has a 20% off
promotion (and don't forget the 0% financing offer that ends July
16th).

it's interesting that they are changing the pricing for the 1 - 3
versions back and that you won't be able to upgrade seats more than 6
versions old. As I've said before, that's great if you're on
subscription (except for the fact that Autodesk is raising
subscription pricing and stopped selling Revit Architecture Suite)
forcing you to pay $250 more for Building Design Suite Premium.

Lets see what happens now that Archicad 16 was just released and
version 17 is out for beta testing, products like Veo and Solibri can
do clash detection and who knows what Dassault has up their sleeve.

So, here's the interesting part. Autodesk has a huge number of
customers who haven't bothered to upgrade their software. There are
about 250,000 seats of software @ versions 2010-2012 that includes
about 90,000 seats of Revit and AutoCAD Architecture(AEC) and 78,000
seats of AutoCAD and LT (Platform). Then there are 140,000 seats of
2008-09 seats with 100,000 evenly split of AEC and platform. My
favorite part is that there are 900,000 seats of R14 to 2007 that will
lose their upgrade eligibility next March. that's 278,000 seats of AEC
and 463,000 of AutoCAD products that the customers have either gone
out of business, have greatly reduced their staff or have no
compelling reason to upgrade because what they've got and 2D is just
fine with them.

In all, that's almost 1.3 million seats of non current customers. Is
Autodesk just being greedy, placating their stockholders, being good
business people or continuing to screw you with their seemingly
monopolistic product suites? With Microsoft only charging $40 to
upgrade to Windows 8, it makes me wonder.

Can you do more with fewer people.when using Revit? Maybe, but you
need to pay higher salaries to those users and keep buying new
hardware, plus spend much more time in doing more with BIM. Are there
such great benefits to the Autodesk cloud products? So far, Autodesk
has only had 100,000 cloud rendering jobs uploaded for 3.3 million
hours of rendering time. let's say they've had cloud rendering for a
year so that's 8,333 jobs/month. Assuming EAC customer does 3
rendering jobs each, that's only 2,777 customers using Revit and cloud
rendering. there's something wrong with the numbers being so low. I
don't think there are that many Revit users and this validates that
thought.

It will be interesting to see how many of the licenses Autodesk will
get upgraded before next March. The reality is, people will only
upgrade because they have to, not because they want to. With little
business coming in, no one will spend a lot of money to upgrade and
start subscription. Throughout the recession, the Autodesk executives
have mandated the price increases and lowered profits for resellers.
That makes it look good to their stockholders and you're to thank for
that. Autodesk should give you free stock shares for every license you
upgrade and subscribe to.

You should have forced your consultants to upgrade to Revit, but since
you didn't, now you have to pay for their lack of investment. Of
course, none of this matters because Autodesk will just announce
another discount promotion after the price increases because come next
March, probably only 10% of those 1.3 million upgradeable seats will
have upgraded. Look forward to lots of emails and desperate phone
calls from your reseller about the offers that are too good to be
true, especially with the 0% interest in the 0% interest promotion.

Oh yeah, almost forgot. The 10% 3 year subscription deal that's been
available dropped to 5% and the 2 year 5% discount has been
eliminated. Yes, Autodesk cares deeply about keeping their customers
happy. Not!!!

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