Susan Smith has worked as an editor and writer in the technology industry for over 16 years. As an editor she has been responsible for the launch of a number of technology trade publications, both in print and online. Currently, Susan is the Editor of GISCafe and AECCafe, as well as those sites’ … More »
Choice is Key as GRAPHISOFT Extends Licensing Options for ARCHICAD
March 22nd, 2018 by Susan Smith
Campbell Yule, director, Global Business Development spoke to AECCafe Voice about the new subscription model offered by GRAPHISOFT.
According to company materials, GRAPHISOFT recently announced the extension of licensing options available for ARCHICAD, its industry-leading BIM software solution.
In addition to standard “perpetual” and “rental” licenses, now both ARCHICAD and ARCHICAD Solo are available as “subscription” licenses. Available subscription terms are either on a monthly or annual renewal basis. Customers can choose to mix both perpetual and subscription products, license options and terms to provide the maximum flexibility for their practice.
What precipitated the need for new subscription options?
Subscriptions models are becoming more and more prevalent across industries. As a result, we have seen demand from our customers and prospects to support this business model. Also different business types, firms’ lifecycle stages etc. require different licensing solutions. We at GRAPHISOFT believe in choice, so we are keen to provide our customers with the full spectrum of licensing options.
What do you find customers want in delivery of their products?
Customers have a wide variety of needs and we’ve always wanted to be flexible with what we offer. In general terms customers want an efficient and simple process. In-direct or offline models can be highly efficient and simple, however many customers prefer the instant availability that at Subscription model can offer.
What types of customers want perpetual licenses and who wants subscription?
Customers are a broad spectrum. We see customers who prefer the ownership feeling that comes with a perpetual license where they have an asset and knowledge it will function without further payment. At the opposite end of the spectrum we have customers who only have operating budgets or limited cashflow where the Subscription model meets their requirements. Between the two opposites are customers who have variability of demand, uncertainty etc. which will determine their purchase preferences. Our intention at GRAPHISOFT is that we provide licensing options that can cater for the widest variety of customer needs.
Can you outline the advantages of each option?
Perpetual licensing a lower cost of ownership over the longer term but comes with a far higher capital outlay up front. Perpetual licenses either need to be Upgraded or be part of a Maintenance Agreement. If economic conditions are less favorable perpetual customers can choose not to upgrade their software but they retain the license to use it ‘forever’ However, during a down turn it is possible customers have many idle licenses ‘on the shelf’
Subscription models provide a low-cost entry for customers providing a cash flow based model which suits many businesses. Subscription licenses are always the most up to date version, however, our customers are not forced to use the latest version of the software if it doesn’t make sense for their business at that point in time. During an economic down turn customers can reduce Subscriptions if required and therefore lower overheads. However, they still need to keep paying in order to have access to the software.
Obviously economic conditions can have a huge bearing on which model is best at any particular time. This is why we see a hybrid model as providing the best value for money for the core needs while also providing the required flexibility to manage these situations.
How would customers purchase both options at the same time, and why might they do so?
Customers probably wouldn’t purchase both options at exactly the same time, but basically there are two possible scenarios: we see many customers who buy Subscription as a low risk entry model where they can determine the benefits of ARCHICAD without the large capital outlay. Once they see the benefits many customers switch to perpetual as they are comfortable with the cost/value at this point. On the other hand, over time as their business grows, many perpetual license customers will use Subscription for new staff until they are confident about the future.
Overall, I’d sum up all these decisions based on the comfort of the situation and the confidence regarding the future.
Do you feel it costs GRAPHISOFT more to offer and maintain flexible options to customers, rather than just going with subscription which some vendors now say is a less expensive way for them to deliver products?
Ultimately licensing is the vendor’s protection of its intellectual property and we are happy to take this cost. Therefore to avoid “getting too much in the way” we are providing software licenses to customers that either have an expiry date that is extended on further payment or no expiry date. The software we develop is accessible by everyone who has a valid license so we have no additional development costs to support both models. Obviously, we have to invest in our back office systems in order to support both models but we see the benefits for customers – and therefore our business – are far greater than the additional costs.
How are the upgrades managed and delivered with each option?
With the perpetual license we have two options, customers can either be part of our Software Support Agreement which provides access to all options – this is an annually paid maintenance program. Alternatively, customers can choose to pay an upgrade fee according to their own rhythm of business to get the latest version for their perpetual license.
With Subscription, the customer has access to the latest version at the point it is released in their market. However, as outlined above, Subscription customers are not obligated to use the latest version until they choose; it is simply their license that is updated automatically and therefore providing access to the latest version.
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