Randall Newton today describes in GraphicSpeak that Autodesk's Q2 revenues are down 1% from a year ago. (The result is in contrast with its largest competitors, whose revenues keep going up.) This, despite all the initiatives the company launched over the last several years that were meant to smooth out revenue fluctuations and at the same time grow them too. Before the recession hit in late 2008, the company planned to grow at 15% a year; shrinking was not in the plans.
Ceo Carl Bass said this during yesterday's conference call. On the one hand...
Our cloud offerings are unmatched in the marketplace, and customer acceptance and feedback has been enthusiastic.
...and on the other hand:
While challenges in some of our end markets have led us to lower our third quarter revenue forecast, we're taking action to rekindle growth.
The two statements point to the problem that the company created for itself. The very actions Autodesk is taking to diversify its software away from CAD and to diversity its revenues away from licenses+upgrades is leading to the fall in revenue its shareholders are seeing.
Many of the new actions it took over the last years are designed to take in less money. For instance:
- Suites means a (roughly) 40% lower income over individually-priced software
- Subscriptions means 4x lower income over upgrade pricing ($500 vs $2000)
- Rental software means 10x-100x less income over perpetual licenses
- Giving away software to education institutes, instead of selling licenses (2% loss)
And so on.
CEOs of other big CAD software companies have been telling us for several years now that they sell to a closed environment; the CAD market has become a stagnant one. A customer win for them is a loss for their competitors; there are few new customers, primarily poached customers. No longer is there a win-win, only win-lose.
In this limited market of our CAD world, Autodesk has decided that offering its software for free (as in education, mobile apps), partly free (as in suites), and pretty cheap (as in rentals and subscriptions) makes sense.
Well... the way I see it there is actually some really positive news out of Autodesk this week.
Autodesk hired Al Whatmough For HSMWorks. Al Whatmough was previously working for a reseller and doing videos that showed how to use HSMWorks. See You Tube. Some of his videos are outstanding.
Al Whatmough might represent the first person that Autodesk has hired for HSMWorks that has some actual machine shop experience and who has a very good idea of all the basics that HSMWorks is so badly missing. There is a ton of work to do on HSMWorks because it's never been developed properly. Despite the constant B.S. that gets floated about HSMWorks, its only real strength is very good integration with SolidWorks.
There is no doubt that Al Whatmough knows what's wrong with HSMWorks as I've made sure he knows in excruciating detail. :>)
HSMWorks doesn't have the proper support for multi-part machining and its solid machine/part simulation leaves a lot to be desired.
HSMWorks doesn't keep full track of a stock model for all 2 and 2 1/2 axis machining operations so you end up Chaining till your wrist gets sore.
HSMWorks surfacing toolpaths require far too much manual boundary creation to control them.
Hopefully Autodesk will empower Al Whatmough to force HSMWorks developers to focus on what they've ignored for many years. If this happens all end users who want much better CAM than what exists now will be the winners.
Jon Banquer
CADCAM Technology Leaders group on LinkedIn
Posted by: JonBanquer | Aug 23, 2013 at 07:12 PM