Last quarter, Autodesk
Commenting on Autodesk's first-quarter results, Bass said that the competitive landscape in 3-D modeling software "continues to remain the same" everywhere he looked. Not that there's anything wrong with that, though: "I wouldn't get too excited about share gains in a single quarter," Bass continued.
Fair enough, but Autodesk recently launched new versions of several major products. Wouldn't you expect, or at least hope for, some temporary share strength based just on that?
It's what Adobe sees every time there's a fresh version of Photoshop available and what Microsoft
Perhaps any update strength was obscured by a general uptick in the sector. First-quarter sales did improve by 11% over last year, to $475 million, and non-GAAP earnings jumped from $0.18 per share to $0.29 per share. Notably, $15 million, or 3 percentage points, of the sales growth came from a promotion on software upgrades leading into an increase of upgrade pricing.
Maybe Autodesk is simply shooting itself in the foot with a clumsy approach to upgrade options. Buy AutoCAD 2011 at full price, and you pay $4,000. Upgrade from the previous version of AutoCAD and you get half off. Not too shabby, right?
But compare and contrast with how Adobe does this: Upgrade to Creative Suite 5 Premium from any CS5 or CS4 installation and you get 68% off. Reach back to version 3 or 2 and you still get a 58% discount. If all you had installed was a recent version of Photoshop, you'd get a 21% discount on the full Creative Suite. With a tiered upgrade model like this, Adobe is sure to catch more flies at the sweet end of the spectrum while also giving more recent customers at least some incentive to upgrade.
Autodesk says that there's a legacy program available for owners of older versions, but that link leads to a dead webpage. Clearly, that program is not high on the priority list.
Autodesk is still a fine business with astronomical margins and an imposing presence in the software market, but I think it could get better with a more innovative discounting program. If you have any better ideas to help Autodesk juice its sales, please share them in the comments section below.