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Lab Notes Blog

Clearing the Air Over Adobe's new Creative Cloud Business Model

February 2, 2012

Tags: Adobe, Creative Suite, Creative Cloud, Photoshop, Lightroom, Illustrator, InDesign, Digital Publishing Suite, software

For some months, the Web and creative community have been abuzz with rumors related to Adobe's upcoming transition to offering its software via the cloud.

Most of the public's concerns about Adobe's new Creative Cloud business model were related to how the monthly fee would affect the budgets of price-sensitive artists and photographers. After all, when you buy a box, you pay once and you're done; you have the software for as long as you want. Then, if you don't want to pay to upgrade to the next version, you can still keep working. With the Adobe Creative Cloud business model, you can never stop paying the monthly fee, if you want to continue to use the software.

This afternoon, we spoke on the phone with Heidi Voltmer, Adobe's Director of Product Marketing for the Creative Pro Business division. During our conversation, she revealed more about Adobe's plans, details that have convinced us that the new business model *may* prove to be both cost-effective and of value for the typical user.

Essentially, here's how Creative Cloud will work:

  • A user will pay a monthly fee of $49.99 for the full suite of applications and services. If you want only certain applications or services (such as Photoshop and Lightroom and nothing else), the fee will be less, though Adobe isn't ready to disclose how much less at present. Nor would they comment on what they plan to do about pricing for students.
  • For the full $49.99/month, you'll get ALL Adobe's applications and services intended for the creative market installed locally on two of your computers, which may be a PC and a Mac with the same license. The applications and services include:

    • Creative Suite 6 the full package, including Photoshop, Illustrator, InDesign, Dreamweaver, PremierPro, After Effects, Fireworks, Flash Pro, Acrobat Pro, etc.
    • Lightroom
    • Mobile applications, such as Kuler, Photoshop Touch, Collage, Proto, Debut, Ideas, etc.
    • New applications, such as Muse 1.0 (which is currently in public beta), Edge (initially as a public beta) and other undisclosed products as they are developed and rolled out.
    • Business Catalyst for Website hosting, though the included hosting will be for a specific size and bandwidth. We're assuming you'll be able to pay an additional fee for a larger, more active site.
    • Digital Publishing Suite

  • Ongoing updates to all programs and services
  • Training and support, though this will be added sometime after the launch
  • 20GB of private online storage
  • The option to sync files among your devices via the cloud
  • Other undisclosed services and goodies

Supposedly, Creative Cloud will allow for smoother workflow among the various programs and services. Creative Cloud will be rolled out at the same time as Creative Suite 6, sometime in the first half of 2012. Then, in the autumn, a Team version will be launched, providing collaborative tools for creative groups at $69.99/month/user.

The good news, for those who really don't want things to change, and prefer to not have anything in their creative workflow disrupted by newfangled corporate business models, is that boxed applications will continue to be available. So, if you simply want to buy a copy of Photoshop CS6, install it and not be bothered with all this cloud nonsense, that will still be an option.

Now, let's look at the economics, assuming a 24-month product cycle. (We're going to use the full retail prices of current products, since it is likely hat the new versions that will be part of Creative Cloud will be priced similarly.) A user who buys into the full Creative Suite Master Collection package will pay $2,600. Of course, you'll have to add in the cost of Lightroom ($150), Digital Publishing Suite ($495) and all the other products. In that same two-year period, you would pay $1,200 for Creative Cloud. Even given a 30-40% discount on boxed software, the Creative Cloud offering does sound reasonable. That is, it would be if you're the type of user who would always upgrade every two years, rather than skip versions to save money and avoid new learning curves that can disrupt workflow.

Our conclusion? Depending on the prices for users who want only a few applications, and how well it is all implemented, Creative Cloud could work out well for many (but not all) creative professionals.

Comments

  1. February 3, 2012 2:49 PM EST
    In response to various emails and comments on Facebook...

    No, Adobe hasn't indicated how much a single license of Photoshop will be via Creative Cloud. Given that Photoshop can be had for about $200, and assuming a 24 month product cycle time (with boxes), that means the monthly fee needs to be less than about $8/month for Photoshop. We feel that it should be around $5/month, with a package deal of Photoshop + Lightroom for about $8/month. We have no insider information on this; it's just our educated guess. At that price, we imagine that Adobe's share of the photo editing market will zoom.

    It is clear to us that Adobe is pricing very competitively, and all the concern we've heard about the cost of the software is misdirected. What concerns us much more is the entire idea of leasing software instead of owning it.

    If you buy a box of software today, you own it. After the two years, you decide if you want to pay to upgrade to the next version. If you don't, you will still have the old software and will be able to keep working.

    If you sign up for Creative Cloud, you can never stop paying. When you do, your software will automatically expire, and you'll be dead in the water, if you want to continue editing.

    - Sally Wiener Grotta