Autodesk is on an adrenalin-fueled rush to complete a two-prong change of its entire business that affects customers negatively:
- Customers will only be allowed to pay repeatedly for using the software; no pay, no play
- Customers will only be allowed to run software through network connections; no Internet, no play
Autodesk is experiencing dismal financial results as customers with permanent licenses are rightfully reluctant to switch from freely using the software on their computers to paying rent. How bad is the switchover for Autodesk? Here's how bad:
With the end of permanent license sales of stand-alone software at the end of January, Autodesk made a big marketing push in Q1 (February-April) to convince 2.8 million permanent license holders to switch. (The "2.8 million" figure consists of customers who Autodesk determined used the software sometime within the last five years.)
Autodesk called the marketing push "one of the most successful promotions we've ever run," and was pleased that over 25,000 switched. Percentage-wise, this is a disappointing 0.9%.
Even worse for Autodesk, the newer the license the less likely the customer would switch. Autodesk found that about half of of those switching were running an AutoCAD that was seven years or older, so AutoCAD 2010 or older. This averages a mere 2,000 per recent release.
(When a financial analyst asked about the discrepancy between "five years" and "seven years," Autodesk felt that some who in the seven-release-and-older cohort perhaps were ex-users [used a competitor's program] or non-paying users [pirates].)
As a result, Autodesk is warning financial analysts that Q2, Q3, and even Q4 will also result in dismal results like Q1.