Todd, can you explain, please...

[Harm_Millaard]

Todd,

You are on record stating that one of the key benefits of CC is the flexibility it gives Adobe to make updates available.

Can you explain how owning or renting a license makes any difference at all to update policies? To me it looks like a BS argument, but maybe I'm wrong.

I also fail to see the relevancy how point releases for Acrobat, Flash or Dreamweaver need to be aligned with AE or PR. That is exactly what Adobe did in the past, there were 'regular' but infrequent point releases for DW and FL that had no relevancy to AE or PR. How will that change in the future?

What is the difference between CC7 and CC8, a version upgrade, that depends on the rental license model that can not be achieved with a perpetual license?

I think the argument is somewhat akin to owning a house or renting a house. Home improvements on the exteriror are done by the owner. The difference is when these improvements are carried out. If you rent, you have to wait for the owner to decide when he starts, if you are the owner you can decide yourself and have the option to further improve the necessary changes.

[able123]

I strongly object to the mssg that my post was any sort of an insult at all, and am now making a case to YOU that you are slandering me. I mean this. My message about the legal aspects of subscription vs "paid up" programs, services, contracts etc.. as it pertains to the SOX business was kind, rather than mean. It was in fact a 'heads up' to the staff member to not over extend his interpretation of " law" and perhaps ( inadvertantly ) mislead forum members.

Whoever deleted my post with the message that I insulted a fellow member of the forums now owes me an apology. Suggestions about over stepping 'bounds' with regard to law and common sense is a thing most "friends" and associates would do for each other in a normal society. In other words, if you say something that is potentially harmful to yourself because it effects you JOB and how your superiors might interpret what you said in a negative way, it would behoove you as a friend to suggest that he stop doing that. Just as I would say to a good friend of MINE, " Please don't keep talking about something you are not qualified to interpret for the company you work for like THAT "

I am shocked and very upset that YOU ( who deleted my post of friendship to the staff member ) assume the message was ANY SORT OF SLIGHT when in fact it was the EXACT OPPOSITE !  Now YOU STOP THIS about slandering me and my posts.. do you understand ??

Thank you !

Rod

[able123]

Do yourself a favor , you who deleted my post, if you really want to deal with it thinking I am being "negative" and "insulting" ... and leave Steve's post here and this thread intact as far as it goes right this minute... and I will see to it that it gets the attention it deserves in the media.

Rod

[Biggles Lamb]

Dave Merchant wrote:

Steve's post is perfectly correct. Customers wanting precise referenced explanations of why SOX affects the release of additional features in a product (not just software), can read this academic paper.

Biggles Lamb wrote:

Oh......Sarbanes-Oxley Act.........is not applicable in countries outside the USA so we out there should have received more from Adobe, as it is we pay way more than USA users as it is even allowing for local taxes.

Adobe Systems Incorporated, as a company registered in and trading in the United States, has to comply with US business laws. It's immaterial where the customers for a product are, it's all about where the company accounts are filed. Even if you buy a boxed copy of CS6 from Adobe Ireland, the ultimate revenue (and more importantly the original cost of the development work) for that product will appear on the US balance sheet.

Then if this is the case there is absolutely no reason why the ex Tax price of any Adobe products should be different in countries outside the US

[excited_Genie16B8]

Then if this is the case there is absolutely no reason why the ex Tax price of any Adobe products should be different in countries outside the US

Taxes are one aspect that are often based on where the product is delivered.  (The local government's want their cut of the individual's money.  It can't all go to the organization who actually produced the product being sold.  That would be downright...fair, and we can't have that!)

[Harm_Millaard]

Jim,

You don't seem to get my argument. Whether that is obtuseness, or something else, I don't know, but here is an example how this scenario works out, based on the tax-treaty with the Netherlands and based on current offerings:

CC Sold in:	Adobe US Sales price	Adobe cost price	Transfer price to Europe	Customer End Price Excl. Local Taxes	Local Taxes for Adobe on profits	US Corporate Taxes	Gross Profit after taxes
Europe	$ 100	$ 50	$ 65	$ 135	25% over $ 70	35% over $ 15	$ 62.25
US	$ 100	$ 50	NA	$ 100	NA	35% over $ 50	$ 32.50

Legally, there is nothing wrong with an internal transfer price of $ 65, when the cost price is $ 50. But you can see that the profit margin after taxes almost doubles for Adobe. Highly attractive for them, but European customers pay around 35% more than US/Canadian/Australian/NZ or South African inhabitants and at the same time Adobe profits significantly from the current tax-treaties. I could even make a comparison when I make assumptions about these internal transfer prices to different European countries which will show even far greater benefits for Adobe.

This has nothing to do with rental versus perpetual licenses, it is only about fair trade and fair prices.

[Steven L. Gotz]

Part of it is "Whatever the market will bear." Fair trade is what happens when a product is offered for sale and purchased by people willing to pay the price. If it wasn't fair it wouldn't have happened. Right?

They charge what they charge because they can.

Is it truly fair? It depends on who you are thinking about. It is certainly fair to the stockholders but not, perhaps, to the customers. But as long as people buy the product, there is no reason to reduce the price unless Adobe thinks they can get even more customers at a lower price - and have it be enough to make up the lost revenue from the price reduction.

It is a game. Once with lopsided rules of course. There are winners and losers.  It isn't all win/win no matter how much we would like it to be that way.

Personally, in the new information age, when things are downloaded from servers located anywhere the company wants to put them, I don't see a reasonable explanation for why the transfer price should be any higher at all. The translated versions, sure. But not the English language versions.

If, in fact, the US taxes on overseas sales are less than taxes on US sales, then that should be used to reduce the transfer price. Yet, obviously, that isn't happening and probably never will. But you have to keep trying. That much is certain.

[Harm_Millaard]

Maybe Marketing and Accounting should read Price Elasticity of Demand and realize that CC is not a Veblen good or service.

[Steven L. Gotz]

Harm Millaard wrote:

Maybe Marketing and Accounting should read Price Elasticity of Demand and realize that CC is not a Veblen good or service.

LOL. I won't be rude and say that it might be over their heads, but certainly it couldn't hurt them to try. Marketing people should not be expected to understand all of that. The Finance people should be advising them. Note that I said Finance and not Accounting.  That's why accounting bored me and I turned my back on it in 1978 and got a technical education instead.

No, Premiere Pro is not in the same category as Caviar.

[Harm_Millaard]

Fair trade is what happens when a product is offered for sale and purchased by people willing to pay the price.

What is fair is allowing a customer to buy a product or service, at the agreed price, but not exclude that opportunity for the simple reason they do not have a US credit card. That makes it unfair. That makes them pay around 35% more and can be considered a form of discrimination.

[Steven L. Gotz]

I agree. But I said as much in post #29.

"International English Version" means nothing in an age when servers can be located strategically around the globe. The price is the price, excluding the tax and the cost of cuurrency conversion.  How they can charge more is anyone's guess. You have been paying the price, right? So I guess they have decided to keep soaking you. Maybe it is a relative of P.T. Barnum who sets the prices.

[Biggles Lamb]

Adobe are in the wrong country

They should be based in the UK and they will pay no taxes

Starbucks, Amazon, Vodafone (biggest UK mobie phone Co), Google all pay virtually no tax in the UK they pay it in other low Company tax countries where the UK side is charged £200 million for the use of the company logo.

[excited_Genie16B8]

Jim,

You don't seem to get my argument.

I wasn't responding to your argument.  Biggles put forth the idea that a US based company following US laws should be charging US tax rates, even for sales outside the US.  I was commenting on that idea.

[able123]

This is a fascinating subject and deserves some attention IMO. I wouldn't say 'being over your head ' is rude. If you tell someone swimming in dangerous waters that they are over their head it is good advice and responding negatively to that admonishment is not common sense.

At any rate..I'm trying to get some focus on this via some media tech reporters ( AP, NY Times , MN. Star Tribune ) and hopefully someone will see this subject as a reason for good journalism efforts...

copy of basic message follows, and if anyone has something concise and objective to add please do...

========

Dear news organization ( fill in blank )

Adobe Creative Cloud

Adobe recently announced it will be providing software for Premier Pro through subscription service only in the near future. The software includes, but is not limited to

the next version of these programs.

Photoshop CS6 Extended

After Effects® CS6 

Digital Publishing Suite

Illustrator CS6 

Adobe Audition® CS6

InDesign® CS6

SpeedGrade™ CS6

Acrobat® X Pro

Prelude™ CS6

Flash® Professional CS6

Encore® CS6

Dreamweaver® CS6 

Bridge CS6

Fireworks® CS6

Media Encoder CS6

Adobe Premiere® Pro CS6

Flash Builder® 4.6 Premium Edition

The next version will be the equivalent of CS7 and will only be available as a subscription ( SaS ).

The current version ( CS6 ) is still available from Adobe as a download ONLY. The boxed versions of the CS6 software is still available in some retail stores but those supplies are limited.

This announcement of the subscription service , called the "creative cloud ", has caused an uproar among professional users of the software products.

In particular, the film editors who rely on platforms without internet connections ( for security and other reasons ) are opposed to a subscription service ONLY model of marketing.

There is an " Adobe Forums " internet presence, sponsored by Adobe, which is fundamentally " users helping users " and is tangential to the Adobe Help available by telephone ( currently located in India I believe ). Many hardware problems, workflow problems, explanations regarding codecs and best practices are solved and discussed in the Adobe Forums.

In many instances the Adobe Forums have actually been the main area for users to go for help, rather than the telephone help service.

Some of the contributors to the forums are authors of Adobe 'Classroom In A Book' series of publications and Lynda.com tutorials.

The current chaos and uproar at the Adobe Forums, with regard to the Creative Cloud 'announcement' ( which came as a surprise to everyone ) is unparalleled in the history of software marketing in my opinion.

I believe this subject is worthy of some good news analysis and reporting. I hope to drum up some interest with technology experts who report on the current and future potentials of global events with influence over such a large portion of the film business, publishing business and cross platform communications.

Please contact me for further information if you wish.

Rodney Bauer

[excited_Genie16B8]

In particular, the film editors who rely on platforms without internet connections ( for security and other reasons ) are opposed to a subscription service ONLY model of marketing.

I'd remove or at least rephrase that.  It's likely to promote the false idea that a machine must be hooked up 24/7 in order to run the software.

[able123]

good point, Jim, thanks... I've changed that in the text I send out...

Well, back to the salt mines of camera test junk..

[jasonvp]

SteveHoeg wrote:

The Sarbanes-Oxley Act prevents new functionality from being added to goods for which the revenues have already been recognized.

I've seen people claim this since SOX was put into place quite a few years ago, but when I've asked for the specifics in the law, no one seems to be able to produce.  FWIW, I'm not calling you out on that, Steve.  Adobe isn't the first company to have done something like this because of supposed SOX compliance.

Harm, et al ... if this is actually the case, then the rest of the world is basically being punished because of what some morons at Enron did here in the states many years ago.  SOX was (and is?) a knee-jerk reaction to that by law makers here, and it's likely they WAY overstepped their bounds. 😞

[able123]

[ message removed by forum host  - personal insults to any forum member, whatever their status, are not tolerated ]

[Luvfilm]

I am trying to make sense of the SOA.  I have a software product that I purchased.  It includes free software update for life.  It is advertised a s such.  I'm not sure how this all fits in with what is we are being told.

[Siz1234]

Re SoX, you are evidently not a lawyer (not a criticism in itself!).  This post is now getting quoted a fair bit - you may want to consider removing it to save Adobe some embarrassment.

[tclark513]

Nice thread!  It's great reminiscing!

[Steven L. Gotz]

I agree. I just read through it again for the fun and aggravation of it all.

It is now one day after the 2015 release. I have seen releases of Lightroom and Muse in between major release, but not so much for the video products. The latest software appears to be stable, and the new features are things I not only want, but never even realized that they were possible.

I expect a lot of anger from people who bought Lightroom 6 fairly recently, when it was exactly the same as Lightroom CC. A few weeks later, there is an effect in Lightroom CC that I will be using almost daily, and it will not be given to Lightroom 6 users. So a lot of this kind of talk will be rampant on the Lightroom forum. Even though everyone was warned that it would happen.

Since this thread began, I retired. And I budgeted for Adobe CC in my retirement plan. But I still think that Adobe could come up with an exit strategy. Could, and should.

[tclark513]

Steven L. Gotz wrote:

But I still think that Adobe could come up with an exit strategy. Could, and should.

Totally agree!  I'm still using CS6 and getting ready to move over to Resolve version 12 when released.  I must admit that I would love the new Adobe versions but I am still not going to rent software.

When I saw they released a "Photography" package I was hoping they would do a "Videography" package also but it never came.  Oh well...

[Steven L. Gotz]

...getting ready to move over to Resolve version 12 when released.  I must admit that I would love the new Adobe versions but I am still not going to rent software.

That is certainly your choice to make. But I am getting a lot of use out of my subscription, and as I said, the new features are things I want, so I am pretty happy with my decision.