SpaceClaim EULA – Follow Up

In an earlier article I wondered why SpaceClaim was not interested in providing support for their software three months after a new version was released. Three months seems to be too short a time when compared to other CAD vendors who offer support for 2 or 3 versions, which amounts to 2 to 3 years. Here is their response.

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“SpaceClaim’s licensing model and product lend itself to a 3 month support overlap. The annual lease licensing model means every customer is entitled, at no additional charge, to upgrade to new versions. This eliminates the cost objection to upgrades. The product data model, where there is no regeneration requirement, eliminates the risk of model failure when upgrading to a new version. This is typically a major reason why customers choose not to upgrade. In addition, our installation model reduces the administration overhead of doing an upgrade since upgrades are available to each user through a download over the web. Finally, our collective industry experience has shown that supporting old versions takes resources away from delivering new versions that offer additional value to every customer.

Of course, many other reasons why customers go to Support, such as answering usability questions, access to the knowledge base, enhancement requests are version independent.”
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I understood a part of the response. I am still trying to figure out the part in bold. I thought people chose not to upgrade because they saw no new features that they would want. And why should they? It’s not their fault that the software developer could not add anything substantial (with respect to their needs) to the new version of the software.

I never liked the idea of software subscription. Why should everyone be “forced” to upgrade their normal car engines to Formula 1 engines just because someone spent lots of money to develop them. Let the cost of developing the Formula 1 engines be shared by the people who want to race. The catch here is that the racers are few and may not be able to afford their share of R&D costs. That’s why spreading the cost over everyone seems to be an easier alternative. Whether this is fair or not depends on which side of the argument you are.

I think it’s unfair. Take the electronics industry for example. When a new gizmo is launched it is priced ridiculously high. But there are buyers for it, the early adopters, those who feel the need for the new features or it’s status value. They are the ones who bear the brunt of the R&D costs, and rightly so. Six months down the line, the price drops down to reasonable levels. That is when other people buy the product because they feel that the price is worth it. It would be unfair to them if a situation was created wherein it would be more economical for then to pay for something they they did not want. Money does not grow on trees.

I agree that supporting old versions takes resources away from creating newer and better software. But I believe software developers have to factor this while pricing their software. The reason we charge 195 USD for a file translator plug-in for AutoCAD (which, by the way, is not too much) is because we still develop and provide support for AutoCAD 2000, which was retired way back in 2004. In fact, AutoCAD 2000 users still purchase our plug-ins and are thankful that we still develop for their version. Developing a plug-in for AutoCAD 2000, 2000i, 2002, 2004, 2005, 2006, 2007 and 2008 (I could have said 2000 to 2008, but I didn’t) requires a lot of planning, possibly re-writing, since AutoCAD has changed a lot over the years. Making the same code work for all versions requires a lot of adjustment. But we do it because we understand that plug-ins are often vital links in a user’s workflow. We respect a customer who wants to stick to the older version of his software. He has every right to do so and we have every duty to support him when he needs our help.

I realize that we would be making much more money if we retired our AutoCAD plug-ins along with Autodesk’s AutoCAD retirement schedule. But money is not everything. I prefer building mutually benefitting relationships not just making new customers or holding back old ones. Relationships bring in much more money in the long run. So many customers of our off-the-shelf products have come back to us to develop customized software or plug-ins specific to their company’s needs.

Coming back to SpaceClaim, I believe they are in a position wherein they need to put their best foot forward. You do not get a second chance to make a first impression. Beginning with a subscription based sales model is a non-starter for a company that is starting up, whatever be their excuse. Subscription usually works for companies that have a firm grip on the market. Add a “three month support overlap”, or whatever they call it, and you are sending out a wrong signal. I wish them well. I hope to develop plug-ins for SpaceClaim one day and when that happens my customers will get much more than three months support.

  • Matt

    One thing they didn’t mention was the fact that what generates the most tech support is a new version.

    I think the section in bold is just saying that with some software, regenerating old models in the new version can cause errors that weren’t there before. It sounds like SC will avoid this.

    When you look at the total cost of ownership over a period of 3 years, the SC pricing is still lower than most other 3D CAD systems, with no upfront cost. I think its a reasonable model, although I’m not thrilled by the fact that if you stop paying, the software stops working. It would be nice to always have access to functional software.

    Something else that interests me about SpaceClaim is that (like Alibre), they have embraced the ActiveX scenario and seem to be all in with Microsoft and Vista. I’m really hoping to see CAD in general get away from Microsoft, or to at least offer the option, and a brand new package such as this not rocking the boat is a little disconcerting. Non-MS OS market share is still low, probably too low to justify a lot of business in that direction.

  • Matt

    One thing they didn’t mention was the fact that what generates the most tech support is a new version.I think the section in bold is just saying that with some software, regenerating old models in the new version can cause errors that weren’t there before. It sounds like SC will avoid this.When you look at the total cost of ownership over a period of 3 years, the SC pricing is still lower than most other 3D CAD systems, with no upfront cost. I think its a reasonable model, although I’m not thrilled by the fact that if you stop paying, the software stops working. It would be nice to always have access to functional software.Something else that interests me about SpaceClaim is that (like Alibre), they have embraced the ActiveX scenario and seem to be all in with Microsoft and Vista. I’m really hoping to see CAD in general get away from Microsoft, or to at least offer the option, and a brand new package such as this not rocking the boat is a little disconcerting. Non-MS OS market share is still low, probably too low to justify a lot of business in that direction.

  • Evan Yares

    Deelip — you ought to look at the terms of the CATIA EULA.

  • Evan Yares

    Deelip — you ought to look at the terms of the CATIA EULA.

  • Owen Wengerd

    Deelip, I don’t think your business model is quite comparable to that of a company like SpaceClaim where most of their internal costs are R&D and marketing costs, but I generally agree with your opinion. The statement you left in bold is curious for another reason that you did not mention: the costs of upgrading usually have very little to do with the cost of the software, but are mostly associated with the downtime, work disruption, process rearchitecture, and training that upgrading requires. It’s difficult to imagine that SpaceClaim magically eliminate those costs while thousands of other software companies have failed. 🙂

  • Owen Wengerd

    Deelip, I don’t think your business model is quite comparable to that of a company like SpaceClaim where most of their internal costs are R&D; and marketing costs, but I generally agree with your opinion. The statement you left in bold is curious for another reason that you did not mention: the costs of upgrading usually have very little to do with the cost of the software, but are mostly associated with the downtime, work disruption, process rearchitecture, and training that upgrading requires. It’s difficult to imagine that SpaceClaim magically eliminate those costs while thousands of other software companies have failed. 🙂

  • ralph

    It is possible to upgrade without disruption. The word processor I use, Atlantis from Rising Sun Solutions, pops up a dialog box every month or two with a list of new features available. The download takes a half-minute, Atlantis shuts down, and then restarts — with all my open documents open again.

    A non-disruptive, one-minute upgrade! Very smooth, and very much appreciated by me.

    Following the upgrade, a new dialog box reports the new features and how to use them. There are usually just 2-4 new features each time.

    For a while, Autodesk did the same with their quarterly enhancement packs (I forget their marketing name). Carol Bartz repeatedly proclaimed the end of the “big-R release.” But then the company lost interest in this user-friendly feature, and is back to the big-R release cycle.

    I could see SpaceClaim going the Atlantis route: a couple new features every few months, indicated by a couple of new menu items or toolbar icons — along with a link to brief and extensive tutorials.

  • ralph

    It is possible to upgrade without disruption. The word processor I use, Atlantis from Rising Sun Solutions, pops up a dialog box every month or two with a list of new features available. The download takes a half-minute, Atlantis shuts down, and then restarts — with all my open documents open again. A non-disruptive, one-minute upgrade! Very smooth, and very much appreciated by me.Following the upgrade, a new dialog box reports the new features and how to use them. There are usually just 2-4 new features each time.For a while, Autodesk did the same with their quarterly enhancement packs (I forget their marketing name). Carol Bartz repeatedly proclaimed the end of the “big-R release.” But then the company lost interest in this user-friendly feature, and is back to the big-R release cycle.I could see SpaceClaim going the Atlantis route: a couple new features every few months, indicated by a couple of new menu items or toolbar icons — along with a link to brief and extensive tutorials.

  • Randall Newton

    SpaceClaim is headed in the direction of Software as a Service (SaaS), although from what I understand, it is not 100% SaaS. The more software becomes perceived as a service–and the less it becomes perceived as a product–the more SpaceClaim’s method makes sense. Deelip, as a vendor, you are caught supporting uses of the old model. Such legacy issues eventually fade away as newer methods take over.

  • Randall Newton

    SpaceClaim is headed in the direction of Software as a Service (SaaS), although from what I understand, it is not 100% SaaS. The more software becomes perceived as a service–and the less it becomes perceived as a product–the more SpaceClaim’s method makes sense. Deelip, as a vendor, you are caught supporting uses of the old model. Such legacy issues eventually fade away as newer methods take over.

  • Deelip Menezes

    Randall, it does seem like SpaceClaim is going the SaaS route. Maybe, one day, SYCODE will adopt the same model. Just that I am not quite comfortable with SaaS right now.

  • Deelip Menezes

    Randall, it does seem like SpaceClaim is going the SaaS route. Maybe, one day, SYCODE will adopt the same model. Just that I am not quite comfortable with SaaS right now.

  • Anonymous

    I think the bolded part means that since you dont have to update your model, then there are fewer issues in updating to a new version. I can’t comment if that is correct, but I can see that angle…

    With some products, even when you own the right to update you may choose not too for stability reasons.

  • Anonymous

    I think the bolded part means that since you dont have to update your model, then there are fewer issues in updating to a new version. I can’t comment if that is correct, but I can see that angle…With some products, even when you own the right to update you may choose not too for stability reasons.

  • Anonymous

    SpaceClaim looks very promising….testing it now!
    CoCcreates user interface a little cryptic. History based modeling….Can someone tell me what the point is ?…I never got it !

  • Anonymous

    SpaceClaim looks very promising….testing it now!CoCcreates user interface a little cryptic. History based modeling….Can someone tell me what the point is ?…I never got it !