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Todd, can you explain, please...

LEGEND ,
Jun 01, 2013

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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.

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Todd, can you explain, please...

LEGEND ,
Jun 01, 2013

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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.

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Jun 01, 2013 0
Adobe Employee ,
Jun 01, 2013

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I'm not a lawyer or an accountant, but the idea is subscriptions change how we will be able to do feature bearing updates because of revenue recognition laws. The Sarbanes-Oxley Act prevents new functionality from being added to goods for which the revenues have already been recognized. Because of this we have previously been able to do bug updates with fixes for advertised features, but not add new functionality when we have already recorded the sale. Subscriptions change what may be done in updates because the revenue is recurring in the same time period as the update.

An excellent question is how have other organizations been able to release features without charging for an update? There are a few ways in which this is possible such as deferring revenue by not recording perpetual sales in the period for which free functional updates are given. When a product makes up a tiny fraction of a company's portfolio this may be feasible, but for Adobe the Creative Suite makes up too significant amount for this to be possible.

We've been listening to the feedback that has been provided on our announcements and will have news around some issues raised shortly. We are really excited for what the Creative Cloud allow us to do and are fully committed to using it to deliver value that we could not do by spending more effort on isolated application sales. We will now be able to release awesome new Premiere Pro features when they are ready instead of waiting for other applications, and accelerate integration between our offerings. Please keep the feedback coming, we appreciate hearing your concerns.

--Steve Hoeg, Engineering Manager, Adobe Premiere Pro

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Jun 01, 2013 0
Engaged ,
Jun 01, 2013

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Steve

As a Premiere user since 4.1 (the old 4.1 Not Premiere Pro 4) I can tell you that from my perspective that there have not been many awesome features in any releases since 4.1 with the exception of (A) 6.5 becoming real time (B) also the addition of sequences (C) Mercury playback.

I am talking about functionality (edit methods, timelines, playback etc) not Adobe keeping up with the changes from SD to HDV to HD.

You have also produced some dogs, Premiere Pro 2 and Premiere Pro 4 to name but two, and also you have not be very forthcoming in bug fixes.

So your Management of Adobe Premiere to date leaves a lot to be desired, so as per a school report..................could have done better 6/10

As for.....deliver value....... that is subjective and certainly does not apply to CC for existing users where the cost of useage over a typical CS version cycle is considerably greater than an outright purchase.

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.

Harm gives the anology about renting a house, you only rent a house because you cannot afford to buy one, you stop paying rent and you get thrown out, unable to use the house you have lived in and loved for years, rent is dead money. 

Have a reasonable subscription cost my all means (not the extortion that the CC is) and a perpetual license available to those who want them, otherwise Edius/FCP/Media C/Vegas etc will go thousands of users. 

I also have Edius and it is not that different to Premiere except it is more stable, will playback more video tracks, and it requires a lesser specified PC, to name but 3 areas where it is better than Premiere

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Jun 01, 2013 0
Most Valuable Participant ,
Jun 01, 2013

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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.

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Jun 01, 2013 1
Advocate ,
Jun 01, 2013

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Dave, Im really surprised how easily many folks buy into this very wiley rationale.

Lets face it. Adobe needed a more constant revenue flow to avoid having to fire 2,000 employees like they had to in recent past and to line the pockets of their investors.

Eternal rental was come up as the solution. A pretty obvious one . But they knew folks would be up in arms, as they have been since this announcement. Thousands are livid.

So they needed a way to persuade the customers that this was necessary by law in order to allow more frequent updates. That it was really being done for the best interests of it users. LOL, right!

Are we as editors really that gullible to buy this very well crafted line of persuation? Sadly I think many folks are.

I am not. Sorry Adobe. Your tactics are very transparent. You took a very happy customer base and stomped on it with your greed. Shame on you.

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Jun 01, 2013 3
Guide ,
Jun 01, 2013

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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

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Jun 01, 2013 0
Guide ,
Jun 01, 2013

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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

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Jun 01, 2013 0
LEGEND ,
Jun 01, 2013

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Are we as editors really that gullible to buy this very well crafted line of persuasion? Sadly I think many folks are.

You go, Tom!  And when you're done with these yahoos soaking up this Adobe BS, we can set people straight on the moon landing and Elvis' supposed death.

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Jun 01, 2013 0
Guide ,
Jun 01, 2013

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Jim,

Please don't get on the band wagon of inflaming emotions by inferering there are " yahoos" ( people you don't agree with ? ) 'soaking up this Adobe Bs' ( implying Adobe is disingenuous ? ) and then ending your post with elvis ?

When I saw your website my first thought was that I should help you as much as possible. Help  you to make something happen with wedding still photography merge into motion ...without costing a lot to you as producer, cameraman, lighting technician etc...

In other words my heart went out to you when I saw what you were dealing with.

Please don't underestimate those who care about you and don't be flippant. This subject is effecting a lot of people who are in the same boat you are in as freelance workers earning a living to support their families. Some are in commercial biz with adobe products and it's a very large business worldwide. PDF alone is a huge chunk of govt and interactive " one size fits all " plans.... this is no joke for Adobe, and not for us freelance workers either.

Chill out a little bit and back off ...there are no " yahoos" and there is no ill intent to help one another make good product. You understand ?

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Jun 01, 2013 0
Advocate ,
Jun 01, 2013

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LOL!  Jim, I salute you and your unwavering allegience . Please join me as we chant your philosophy together..."Adobe, please take my money and do what you will to me".  Im sure you make them proud ( and very rich as well). 

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Jun 01, 2013 0
People's Champ ,
Jun 01, 2013

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Some of you forget that with the new subscription model Adobe has specifically targeted specific types of customers, with specific wants and needs.

It is silly to attack those of us who Adobe has specifically targeted just because we are pleased with the situation. The low entry fee to get all of the Adobe software is going to be too much for many new customers to ignore, and will certainly produce a nice revenue stream for Adobe.

For those of you who feel, and rightly so, that they are being shafted by Adobe, we feel for you, and understand that many of your concerns are quite valid.

I personally feel that Adobe will figure out how to give you your exit strategy without changing their new policy in any way that damages their reputation or indicates that they have given in, and that will satisfy a portion of you. Not all, certainly, but perhaps a large portion nonetheless. Some of the other concerns are, I believe, just alarmist rants. Worrying about the rates going to $500 per month is just silly. It does make for a great Hitler meme, but it isn't rational.

The irrational arguments are not doing anybody any good. The rational ones, in the form of gathering support for a Feature Request barrage from thousands of customers? Ah, now that might actually be a useful tactic.

Seriously, why not concentrate on doing what the Adobe employees have suggested that you do, and get everyone who agrees with you to do the same? Even I would be happy to submit a request for an exit strategy. I might need one one day myself.  There might be other well crafted requests that could get enormous responses. If everyone who had signed that online petition had submitted an identical feature request, the results would have been different, of that I am certain. It would have been taken more seriously, if just because we know for a fact that there is a procedure to review feature requests.

You all have the right to rant, but wouldn't it be better to work within an existing system?

Harm started this thread with some perfectly reasonable questions. They didn't get answered in the way I would have liked, but the best way to deal with that is probably to respond to Steve's post and let him know that his answer about revenue is only a small part of the real question.

I think what a lot of people really want to know is how the upgrades would have looked had this model been in place for CS3 and beyond. What features had to be held back waiting for Photoshop or Illustrator to be ready, and what Photoshop features had to wait for Dreamweaver or Premiere Pro. Explain how we would have been better off in the past so we can use that to forecast how it might be in the future. Leave out the improved sharing capabilities, or leave that to the end of the examples of how it will be better that what came before.

Explain that the minor point releases are not the issue. The releases that have significant features have had to wait. We understand that was the policy, but point out some examples of something we had to wait for that would no longer be necessary under the new model.

Also, explain why a line can not be drawn in the sand every few months to say "You can have a perpetual license for the software on your PC for this fee - and name a fee based on who paid what to get to that point. People who paid for CS6 are obviously getting a lower fee than those of us who came off of CS3 straight to the Creative Cloud. The accountants can't be too lazy to work up a simple spreadsheet. I live nearby. I would be happy to assist them.

Some of us prefer to have the yardwork done by the HOA, some prefer to mow their own lawns. I get it. But unless Adobe explains why the HOA should be doing the work in a convincing way, then the Marketing department ought to be fired en masse. Every last one of them. No offense to Steve, as I am sure he does a fine job. But the Engineering Manager should not be talking to us about laws and Marketing positions. The Marketing people have got to step up and provide the proper guidance or this issue will never get satisfactorily resolved.

Steve is the right guy, however, to talk about how features are released.

That's my $0.02 for all that it is worth.

artofzootography.com

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Jun 01, 2013 0
LEGEND ,
Jun 02, 2013

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Whichever way you turn it, Adobe is in the market to make long term profits for their shareholders. Nothing wrong with that. At least as long as they have customers that are willing to part with money that they feel is well spent on Adobe products. If Adobe lacks clarity in communicating their intents and where the 'value added' is for their customers, who are the generators of the long term profits, everybody loses. Adobe loses customers and thus revenues, customers are disgruntled, market share drops and ultimately shareholders feel they don't get the rewards they expected.

OK, Adobe is US based and must adhere to US law. Completely logical. Their development work is done to a large extend in the US (and India for all I know), their CC servers are US based, their distribution is US based, activation servers are US based, their exports are based on US restrictions, in short their stance it that we, the customers, are dealing with a US based company that abides by US laws. That is fair, I think. At least it is very clear.

One may wonder whether a different accounting method for perpetual licenses would not have been easier to circumvent the SOX legislation and avoid this outrage, but that is something that all the much appreciated presence of Adobe staff can not alter. Those decisions are all above their pay-grade as they are above mine, but then I'm not a staff member, so that is no surprise.

Personally, I think that bug fixes and improving functionality (something that works only partly) of existing products but not adding new functionality is perfectly legal even under current Adobe accounting policies and US law, but, like Steven I'm not a lawyer, nor an accountant.

What is more disturbing in my eyes is the fact that Adobe is not clear at all. If everything is based on US rules, regulations, law, accounting principles and other relevant restrictions, why not treat all customers the same as US citizens? Charging them the same prices, giving the same educational benefits, etc.

But Adobe does not do that. They overcharge European customers significantly in comparison to US customers, using the excuse of 'the cost of doing business locally'. Well, development, distribution and activation is purely US based, nothing local. So where is the local cost? Is that an Apple like approach, that uses tax treaties and havens to allocate revenues to a local company, lowering corporate taxes and increasing net profit for the shareholders over the back of European customers?

In my consulting practice I have seen many US based companies, to whom US law applies, using transfer pricing to lower corporate taxes by diligent use of tax treaties with for instance Ireland, Luxembourg, Switzerland and the Netherlands in a completely legal way (well, sometimes borderline). These actions resulted in a significant boost of the bottom line, sometimes in the tens or even hundreds of millions per year. I suspect Adobe is no different, but that makes it even worse and more bitter for European customers. They get ripped off by Adobe and Adobe profits extra because of the transfer pricing and tax-treaties. I can't substantiate this, but from a business point of view, using these 100% legal loopholes, a company would be crazy not to use them.

When a European customer goes to Microsoft, B&H or whatever other US based company, they can use their credit card to pay for the order they place. They don't need a US credit card, but Adobe does not allow that. Is it for the tax reasons mentioned above that a customer can only buy locally from a US based company?

On the one hand Adobe claims to be US based and adhering to US laws, but at the same time it hides behind 'local business' for which a completely different set of rules apply. That is not trust inspiring or consequent for me.

This leads me to two different requests:

  1. Equal pricing excluding local taxes around the globe, since this is a global business, all originating in the US, so pricing should be US based. No discrimination based on very vague arguments that do not hold. CC is a worldwide approach, with development, electronic distribution, electronic activation, electronic payment, electronic updates, everything is done from US based server parks, so there is no argument whatsoever to discriminate based on country of purchase.
  2. Create an exit strategy for those customers that can not or will not pay rent anymore to get a perpetual license, not a downgrade to CS6.

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Jun 02, 2013 1
Most Valuable Participant ,
Jun 02, 2013

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The original question posed by this thread is entirely about the availability of updates. It has nothing to do with contrasting price models in different countries, if you wish to debate that I suggest you begin a new thread or we'll get into a three-way argument. Neither is this a topic about whether CC is a good or bad idea, financially or morally. Plenty of other threads for discussing that!

To go back to that question, the precise issue with SOX relates to 'features' which were not advertised in the original accounting period. So:

  • Free bugfixes are fine, as the feature being fixed was always there and known about.
  • Feature improvements are also fine, such as support for changes in third-party hardware or cures for security problems, as the feature itself is not new. You can make forward-facing claims such as "this product will support Windows 9 when it arrives" and in turn release free Win9 compatibility packs, but you would then have to defer a percentage of the revenue as the product isn't legally "delivered" to the customer until that feature is turned on. As Steve says that's a valid model for some businesses where the deferred revenue isn't all that high - but not for Adobe.
  • Anything which was not part of the public specification when the first copy was sold (such as making Lumetri an effect in Premiere Pro) cannot be free. The vendor has the option either to charge for the update separately, or start a new accounting period by upping the version number (which starts a new 'lifetime' for a product). It doesn't matter if the feature was actually a hidden part of the original code, the fact it was not advertized is all-important.

Apple chose the 'charge for update' model for their release of the 802.11n wifi driver (the first major case where SOX affected technology releases). Didn't go down well.

By switching to a subscription model, the accounting period for Creative Cloud is now a sliding window. Revenues for a brand-new feature first advertized and released in Q3/2013 can be declared in that quarter, so Adobe is able to give people pretty much anything as soon as the code is stable. When Acrobat XII arrives you will get it as a 'free update' but in accounting terms you're canceling your subscription to Acrobat XI and starting a new subscription to Acrobat XII. One book closes, another opens. Yes of course there are implications on Adobe's overall revenue stream, but that's not the point in this thread.

One thing to bear in mind - while bugfixes can be issued free under SOX, we all know that it doesn't necessarily happen. Pr CS6 has some 'issues' which on a practicable level will only be resolved in CC, simply because of the amount of work involved - and that really annoys people. Subscription means that those 'major fixes' will be released a lot faster, as engineering will be working to a rolling timetable, and people will get them free no matter how much work is involved.

To respond to your second point about the timing of non-CC product cycles, there are no announced plans to change that. Acrobat, Captivate, etc. will continue to run their own calendars, Acrobat remains available on a perpetual license so will continue to have major version releases. The CC applications don't really have a public calendar anymore, but their internal version numbers will increment as they do now, so IT departments can track the status of deployments.

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Jun 02, 2013 0
LEGEND ,
Jun 02, 2013

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The original question posed by this thread is entirely about the availability of updates. It has nothing to do with contrasting price models in different countries, if you wish to debate that I suggest you begin a new thread or we'll get into a three-way argument. Neither is this a topic about whether CC is a good or bad idea, financially or morally. Plenty of other threads for discussing that!

You don't seem to grasp that availability of updates is directly related to 'value for money'. If there are no relevant updates, it is not worth the money, If Adobe has proven to be rather lackluster in their updates, the implicit question is, what makes the new model so much more attractive?

As a paying customer, I want to see my money's worth. I have historically not seen anything but bug fixes in point releases. The question is what will change to give me more BFTB or am I only discriminated by Adobe based on the country I live in, without anything essential changing?

The original question is what do I get EXTRA that could not be delivered with the perpetual license and why? Steven made an effort to explain that and I appreciate his effort, but that still leaves a lot of questions unanswered. If you prefer to make that a separate issue and thread, go ahead and move this post to a new topic or get someone else do it for you, I don't care. I do object to the way you circumvent the issues I raised, but maybe you will reply to-the-point if and when this is made a separate topic. I will not, since it would be double posting, something that - as you should know - if frowned upon.

Pr CS6 has some 'issues' which on a practicable level will only be resolved in CC, simply because of the amount of work involved - and that really annoys people. Subscription means that those 'major fixes' will be released a lot faster, as engineering will be working to a rolling timetable, and people will get them free no matter how much work is involved.

That sounds pretty optimistic. If a number of my bug reports have been referred to CS Next, or CC Future, it means that they are postponed till a new version arrives. Some of these bugs date back to CS5 and have not been solved but deferred to CC8 or whatever comes out after CC7, maybe because they were difficult to solve, but the new model does not make it easier to solve them, it will still require lots of effort to correct them. I can't share your optimism that these 'major fixes' will be released a lot faster. 

Bugs that exist in CS5, that have not been solved in CS5.5, not in CS6 and still not in CC7 do not bode well for faster solutions.

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Jun 02, 2013 1
Engaged ,
Jun 02, 2013

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lasvideo wrote:

LOL!  Jim, I salute you and your unwavering allegience . Please join me as we chant your philosophy together..."Adobe, please take my money and do what you will to me".  Im sure you make them proud ( and very rich as well). 

That's great!

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Engaged ,
Jun 02, 2013

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Worrying about the rates going to $500 per month is just silly

It's funny how every time someone wants to make a point about somebody complaining that Adobe is going to raise prices they make some astronomical amount (500.00) in this case.  Of course their not going to raise it that high!!  But I guarantee they ARE going to raise it, and even just little raises at a time are going to push people out of the game when they could barely afford it to begin with.  Then guess what happens...they can't work on any of their projects because the software won't work.  And don't give me that crap you can open it in CS6.

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Jun 02, 2013 0
People's Champ ,
Jun 02, 2013

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The problem is that I have seen that $500 per month number more than once. That is my point. Instead of stating it rationally, like you just did, it often comes out as something that just circumvents the real issues. And that is a shame.

artofzootography.com

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People's Champ ,
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like Steven I'm not a lawyer, nor an accountant.

Um, actually, while I don't mention it often, I was an accounting major at California State University at Long Beach once upon a time in a land far, far away.

I also spent time in Corporate Management when SOX first became law and have had extensive training regarding the ins and outs of it.  It has been a decade, and I don't do that kind of work anymore, so I can't represent Adobe, or argue with them regarding SOX. Not anymore anyway. But the real issues for Adobe, as has been pointed out elsewhere, are communications and financial disclosure. SOX doesn't stop you from being open and honest. You can still announce what people need to know. You just have to do it in a fair manner so that all parties have equal access to the information. It really isn't relevant to this issue.

You see, that is why I just don't care about it in this situation. Even if subscription does or does not make it easier to release minor fixes and features, I am more concerned with how the subscription model would have changed things had it been in place a few years back in order to be able to determine how it might benefit us in the future. I think that is what people really want to know. Nobody cares about the details of SOX. They care about the ramifications. I want Adobe to tell us about those by providing examples we might be able to wrap our heads around.

As I said, Adobe Marketing needs to get their heads out of the sand and produce some information that either convinces you to go along with the new model, or assures you that other software is in your future. This bickering is the fault of lousy communication skills on the part of people who seem to know how to get pretty pictures on the web site but not how to communicate in words that long time users can use to base the decisions on.

artofzootography.com

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Jun 02, 2013 0
Adobe Community Professional ,
Jun 02, 2013

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Steven L. Gotz wrote:

like Steven I'm not a lawyer, nor an accountant.

Um, actually, while I don't mention it often, I was an accounting major at California State University at Long Beach once upon a time in a land far, far away.

In context, I think Harm was referring to Steve Hoeg.

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Jun 02, 2013 0
LEGEND ,
Jun 02, 2013

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Stan,

You are correct, I referred to Steve Hoeg. Sorry for the misspelling.

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Jun 02, 2013 0
Engaged ,
Jun 02, 2013

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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

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Jun 02, 2013 0
People's Champ ,
Jun 02, 2013

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Ah, I see.

I suppose it's funny, but I am very careful with people's names. I prefer Steven to Steve for reasons that have nothing to do with being formal. I shared an admin with a fellow across the hall many years ago, and his name was Steve also. So the admin determined that henceforth, I would be Steven and he would be Steve. I adopted the usage and have never questioned it.

What really gets me is when I sign or type my name in a message, and the person responds by calling me Stephen. That drives me NUTS! I spelled it for them. How hard can it be to be polite and spell people's names correctly? That is also why I ask people how to pronounce their name. Mine is often pronounced incorrectly - it Got with a Z at the end, not Go with a TZ at the end. I am not related to Goats. Although, being a Capricorn could confuse the issue.

I read back through Steve's post and I can now see the reason Harm responded that way. No harm no foul. My post still applies. People should concentrate on the real problems, not make up silly ones or talk about financial issues that cloud the real issues. Money is important, but people will be willing to pay for something they want. Marketing should be doing a better job of communicating why you should want it their way! As for the European pricing, that is a horse of a completely different color.

artofzootography.com

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Jun 02, 2013 0
LEGEND ,
Jun 02, 2013

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Please join me as we chant your philosophy together...

Awesome!  Just give me a sec to draw the ritual circle and gather the necessary ingredients...

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Jun 02, 2013 0
LEGEND ,
Jun 02, 2013

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point out some examples of something we had to wait for that would no longer be necessary under the new model.

I believe Photoshop received an update offering some new 3D capabilities that the boxed still doesn't have.  It was ready, it got pushed to CC.

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Jun 02, 2013 0
LEGEND ,
Jun 02, 2013

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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!)

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Jun 02, 2013 0
LEGEND ,
Jun 02, 2013

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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$ 50NA$ 100NA35% 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.

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Jun 02, 2013 0
People's Champ ,
Jun 02, 2013

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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.

artofzootography.com

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Jun 02, 2013 0
LEGEND ,
Jun 02, 2013

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

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Jun 02, 2013 0
Advocate ,
Jun 01, 2013

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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. 😞

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Jun 01, 2013 0
Guide ,
Jun 01, 2013

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

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Jun 01, 2013 0
Community Beginner ,
Jun 01, 2013

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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.

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Jun 01, 2013 1
New Here ,
Jun 17, 2015

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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.

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Jun 17, 2015 0
Engaged ,
Jun 17, 2015

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Nice thread!  It's great reminiscing!

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Jun 17, 2015 0
People's Champ ,
Jun 17, 2015

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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.

artofzootography.com

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Jun 17, 2015 0
Engaged ,
Jun 17, 2015

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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...

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Jun 17, 2015 0
People's Champ ,
Jun 17, 2015

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...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.

artofzootography.com

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Jun 17, 2015 0