#solidworks pricing

[techsavvyengineers]

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[andmaybegayer]

Hello it's me with another very naive computer question!

One of the really common complaints you see about modern software (from Adobe, Microsoft, etc.) is the move from the single-purchase model to a subscription-based model. While I understand that people are upset about paying more money over time, this also feels like the only viable option for shipping products that work with modern OSes, especially Windows (I don't have any experience with MacOS). Windows pretty regularly updates, and if you want your product to continue to work, you have to continue paying your engineers to maintain compatibility through time.

Obviously I understand that there are lots of FOSS options out there, but for the companies that are built on making money from these sorts of software products, I don't see another way. Am I way off the mark here?

This is a really good question. I don't have a great answer, but the model I have in my head is that "traditional software distribution" is partially an artifact of an era where companies were starting to use computers but internet use was still spotty so providing support for software was just a very different ballgame. A lot of what I'm saying here is not like. Fact as much as it is my understanding of The Software Business from the side of someone who is a little involved in that but mostly not in that.

(This is mostly about "business software", that is to say, accounting packages, creative suites, design packages, modelling tools, etc. This model does not explain like. Spotify. But that's much easier to explain.)

You're not wrong that the subscription model really make sense given modern software development, where patches come out continuously and you get upgraded to the latest version every time something changes, but there has been a significant change in how software is developed and sold that makes it noticeably different. I think that the cause of this is mostly because it's finally practical to do contract-style deals with hundreds of thousands of customers instead of doing one-off sales like we used to do.

In the Traditional model you charge a pretty sizeable upfront cost for a specific version of the software, you buy Windows XP or Jasc Paint Shop 7 or whatever and then you get That Version until we release The Next Version, plus a couple years of security and support. When the next version hits, we stop adding any new features to your version, and when that hits end of life, you maybe get offered a discount to buy licensing for the latest version, or you drop out of support.

Traditional software with robust support typically costs an awful lot, Photoshop CS2 was $600 new in 2005, or $150 to upgrade from CS, because you're paying for support and engineering time in advance. A current subscription for just Photoshop is $20/mo, and that's after twenty years of inflation. Photoshop is also cheap, a seat for something like SolidWorks 2003 could probably have run you $3000-4000 easy. I can't even give you a better guess there because SolidWorks still doesn't sell single commercial licenses online, you have to talk to their salespeople.

The interesting thing to me about Traditional pricing was that I think it was typically offered to medium to small businesses or individuals, because it's an easy way to sell to smaller customers, especially if it's the 90's and you're maybe selling your software through an intermediary reseller who works with local businesses or just a store shelf.

Independent software resellers were a big business back in the day, they served as a go-between for the software company and smaller businesses, they sold prepared packages in a few sizes and handled the personal relationship of phoning you up and saying "Hey there's a patch for your accounting software so that it doesn't crash when someone's surname is Zero, we'll send you a floppy disk in the mail with some instructions on how to install it." Versioned standard releases are a thing you can put in a box and give to resellers along with a spec sheet and sales talking points. This business still exists but it's much smaller than it once was, it's largely gone upmarket.

If you were bigger, say, if you were a publishing house that needed fifty seats of editing software you'd probably call the sales department of Jasc or whoever and get a volume deal along with a support contract.

Nowadays why would you bother going through resellers and making this whole complicated pricing model when you could just sell subscriptions with well-established e-commerce tools. You can make contract support deals with individuals at scale, all online, without hiring thousands of salespeople. You can even provide varying support levels at multiple cost brackets directly, so you don't need to cultivate a direct business relationship with all your customers in order to meet their needs. Your salespeople handle the really big megacorp and government deals and you let everyone else administer themselves.

It also makes development easier. You can also deploy patches over the net, you just do it in software. You can obsolete older versions faster, since you can make sure most people are using the latest version, and significantly cut down on engineering time spent backporting fixes to older versions. I think a lot of this is straightforwardly desirable on most software.

Now, there are still packages sold by the version, and there are even companies selling eternal licenses.

Fruity Loops Studio is still a "Buy once forever" type deal.

MatLab can be purchased as a subscription or as a perpetual one-version license.

Windows is still sold like this, but also direct to customer sales of Windows are minimal, Windows is primarily sold to OEM's who preinstall it on everything.

But it's a dying breed, your bigger customers are going to want current support and while there are industries where people want to hang around on older versions, for a lot of software your customer wants the latest thing with all the features and patches, and they'd rather hold on to their money until later using a subscription rather than spend it all upfront. Businesses love subscriptions, they make accounts books balance well, they're the opposite of debt.

Personal/private users who might just want the features of Photoshop CS2 and that's fine forever don't matter to you. They're not your major customers. This kind of person is not a person who your business cares to service, so you don't really care if you annoy them.

Even in the Open Source business world, subscriptions are how the money is made, just on support rather than for the software itself. You can jump through relatively few hoops to run Ubuntu Enterprise or SUSE Enterprise Linux on your own systems for free, but really there's not much benefit to that unless you pay for the dedicated support subscription.

In many ways I think a lot of things have changed in this way, I have a whole thing about the way medium-scale industrial manufacturing has changed in the past thirty years somewhere around here.

While there are valid reasons you might want to buy a single snapshot of some software and run that forever, the reality is that that's a pretty rare desire, or at least that desire is rarely backed by money. If you want to do that you either need access to the source code so that you can maintain it yourself, or you need to strike a deal with someone who will, or it needs to be software so limited that it (and the system it runs on!) never need updates. Very few useful programs are this simple. As a result subscription models make sense, but until recently you couldn't really sell a subscription to small businesses and individuals. Changes in e-commerce and banking have enabled such contracts to be made, and hey presto, it's subscription world.

[richrdjones]

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[sexhaver]

im setting up a VPN and TorrentBox to handle this myself but in the meantime would any of my lovely followers happen to have a cracked copy of SolidWorks? i really did try to be a goody two-shoes and (gag) pay for it, but the pricing page for the most basic package tells you to "call a representative for a quote" instead of listing a number, which is code for "at least 4 digits lol"

[robbie89smith-blog]

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[techsavvyengineers]

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[solidworkssoftware]

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[richrdjones]

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[aeribn]

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Verdict

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