Software can be prohibitively expensive, so the notion of purchasing valuable but expensive software for a short-term project can lead to indecision and frustration.
That's why software subscription services are now challenging some commonly held notions of accessibility and affordability.
Adobe, Microsoft, and Autodesk are examples of companies now offering cloud based versions of their software. The cloud-based versions are always offered on a pay-as-you-go subscription basis. And some, but by no means all, are also offering subscription licensing programs for their traditional desktop applications.
Autodesk, for example, is preparing to eliminate new sales of perpetual licenses of its software altogether. On Feb 4, 2015 they announced that commercial seats of most standalone desktop software products will be available only by Desktop Subscription beginning February 1, 2016.
Like anything new, there are skeptics of the subscription model. So why would a user want to switch to a subscription?
Benefits of Desktop Subscription Service:
Match Licenses to Fluctuating Staff Levels: Many firms ramp up and down based on the size of their projects. The ability to add and subtract seats on a quarterly or yearly basis can help reduce long-term costs when compared to a perpetual license model. These lower upfront costs can translate to an overall savings for your company or your customer.
Acquire Specific Software for a Project: The Desktop Subscription works in scenarios where a client specifies a particular software that you may not have. A subscription reduces the cost of buying software for one particular short-term job. You can purchase a Desktop Subscription on a monthly, quarterly or yearly basis, depending on your needs.
Billing Software Directly to a Project: If a client requests specific software, you can add the cost of the Desktop Subscription to your proposal or bid. For example, if you need to use Building Design Suite to improve your architecture, engineering and construction project outcomes, you may be able to pass along the $605 per month charge to your client, but you do not have to pay $12, 075 for a perpetual license, or even $4, 830 for an annual subscription.
Explore New Solutions: With lower upfront costs and no long-term commitment required, Desktop Subscriptions can be a low-risk, low-cost way to try out something new that can help you innovate or solve a new problem. If high upfront costs for an unproven-in-your-unique-situation-solution has been holding you back, consider Desktop Subscription as a way to explore possible solutions inexpensively.
Budgeting Advantages & Potential Tax Savings : In addition to being able to add or subtract software seats and paying for software as you need it, you may be able to save money by deducting the desktop subscription as an operating expense, rather than capital expenditure.
In general, operating expenses can be fully deducted in the accounting period they are incurred. Buying full versions of software is considered a capital expense that cannot be deducted in the same year they are purchased. Of course consult with your finance partner or tax advisor, but this could save you money and maybe even open up different budgets to fund your operation.
Automatic Updates: Though Desktop Subscriptions may take away the safety blanket of the permanent version, they offer the additional advantage of always being able to upgrade to the latest version of whichever software you subscribe to. The cost of the upgrade is built into the subscription fee.
Autodesk places a big bet on the Subscription licensing model
In the February 4th announcement, Andrew Anagnost, Autodesk senior vice president of Industry Strategy & Marketing, said, "How the world is designed and made is changing, and how software is delivered is changing as well. The companies that embrace these changes will lead their industries toward a more nimble, connected and richer future. Our customers have long asked for greater flexibility and more value from their software investments. The shift to subscription allows Autodesk to deliver both, as well as an improved user experience and easier access to a broader portfolio of technology.”
The perpetual license versions of the popular titles won't suddenly vanish - users can continue to keep them current with Maintenance Subscription. And the switch-over date is still a year away so that customers can plan and prepare. Autodesk customers who have purchased perpetual licenses prior to February 1, 2016 will be able to continue with those licenses, and customers on Maintenance Subscription will continue to receive corresponding benefits. New perpetual licenses for Autodesk Design & Creation Suites and other suite offerings will continue to be offered beyond February 1, 2016.
Desktop Subscriptions are available for 25 Autodesk programs, from 3ds Max to Product Design Suite to AutoCAD, and as their recent announcement suggests, more programs are coming soon to Desktop Subscription.
Autodesk has paid a fee to ENGINEERING.com to promote their software solutions. They have had no editorial input to this post. All opinions are mine. - Andrew Wheeler