Adobe SaaS: Room for disruption

For those living under a rock this past week, Adobe has announced that going forward, they will be abandoning their tried and true method of software delivery, the hard copy, and will be moving entirely to delivery via Creative Cloud subscription. Starting in July, you’ll be handing over $50/month to Adobe for the rest of your life. In exchange, you’ll have full access to the entire library of Adobe Creative software, unlimited use of Typekit, and some other “goodies.”

Here’s my reaction, as written in an email to my friend Mike:

Creatives with a capital C are some of the most stubborn people to design for—stuck in their ways, snotty about their bad habits, practically unable to understand that sometimes new is better/easier/more efficient, etc. The SaaS move allows Adobe to keep their software updated, always. Really good for them, probably good for users (whether we realize it or not), and probably not good for printers/producers who are notoriously slow to support new software.

So I think that is going to be a problem: the initial adoption. I also think it is going to require a significant amount of extra work on the side of production for that industry to support this. Maybe I’m wrong. If Adobe is smart (not sure about this), they will have reached out already to their production partners and will be ready to help them get going.

In a general sense, Adobe is basically deciding to say Fuck You to some-time freelancers, prosumers, and anyone who believes that they should be able to own the things they pay for. The cost is huge—$50/month. Adobe does give you some nice add-ons for this cost: unlimited access to TypeKit, some sort of collaboration tool I’ve never bothered with, etc. And you do get access to the entire suite of apps from them, which is awesome, if you’re like me who dabbles in basically everything Adobe is involved in (motion, print, web). But most people aren’t and don’t.

Year over year, the cost is roughly equal to the cost of a full Creative Suite: $50/month = $600 per year. Adobe used to charge about $1200 for a baseline creative suite that was specific to a particular vertical (motion, web, print). They updated the suite every year-ish, usually with a .5 release at one year, and full refresh at year 2. Updates ran anywhere from $200 for a single app to $900 for the Master Suite.

So in this model, if you’re a person that updates every year, you end up paying the upgrade price once a year—same as always. In fact you save money, because you never have to put down for the initial full suite.

Unfortunately for Adobe, most people don’t upgrade at every cycle. They skip the .5 releases, or even do things like go from CS 3 to CS 6, etc. Adobe doesn’t make very much money from those users right now, because they still offer the upgrade price for several releases back.

So. Adobe wants to make a more consistent cash stream from their customers, and they also want to get everyone running the same-ish version of software, which will allow them to save more money by not having to support old software. Something has a weird bug, or a security hole? Just upgrade your cloud-software.

On the user side of things… There is something very painful about paying $50 every month, whereas with one large charge every year-ish or more is something you put on your charge card and either swallow the big hit as part of normal operating costs, or you spread the charges out over a few months, and forget it after the first month as after that, it’s just a balance you carry on your card.

Adobe is betting there will be a contingent of users, probably similar to me, who will pay the $50 every month, even though they might not use the software enough to really justify the expense. In other words, the gym membership theory. “Well, I might need to use it for work, freelance, or some fun personal thing,” we’ll say, as we end up forking over $600/year for apps we barely touch, that have way more features than we need. Unfortunately, I know of no software that can replace InDesign, which is probably my favorite Adobe app. It’s the closest they ever got to Good Software. So people still doing print design are still going to be tied to them (Adobe having basically killed Quark).

Anyways, yes, Adobe has further opened itself up for disruption by consumer and prosumer level apps for photo-editting, web design, and illustration. To an extent they’ve already cannibalized their Photoshop group with Lightroom, and Aperture has undoubtedly taken a large chunk of this type of user as well. Their video apps have already been disrupted by Apple.

Adobe might not care. They’re going to make enough money off the groups that decide for pay for Creative Cloud to more than make up for the loss of the casual users (most of whom haven’t actually PAID for CS… just figured out ways to get it for free, whether through putting work copies on home computers or just blatantly ripping it off). They will definitely get more than a few people who don’t need to pay for it to pay for it.

And in the meantime, there is room for a challenger in the consumer/prosumer area of things, in the areas of illustration and web design comping, as well as desktop publishing. I really hope either one of the current players (Pixelmator, Sketch, etc.) or a new player comes in and takes advantage of that market. I hope they eventually creep into the pro areas.

Mike wrote back with a simple reply, summarized here by me: that Adobe is focused on platform-building, rather than software innovating. In other words, it seems somewhat crazy that we’re discussing how we’re going to pay for the software, instead of talking about the software itself.

Have the business guys completely taken over? Maybe. But then I saw this post from Zeldman: Adobe Love, in which he states:

It sometimes seemed to me that Adobe hadn’t so much acquired Typekit as the reverse: that the people and thinking behind Typekit are now running Adobe (which is actually true), and that the mindset of some of the smartest consultants and designers in our industry is now driving a huge corporation.

And I have to wonder if Adobe has the grit to drag all of us annoying, snotty, stubborn creatives into the 21st century, kicking and screaming. If, in transforming their own culture, they can transform us too. After all, we are the products of the tools we use…