Creative Cloud or Captive Consumer?

Adobe has just announced their new software delivery paradigm. A stand-alone program will no longer available in their former CS, Creative Suite bundle singly or as various bundles. They call their new paradigm Adobe CC for Adobe Creative Cloud where bundles or some single products will be available for monthly subscription fee. Anyone who wishes to use Photoshop, InDesign, Illustrator, and so on, will have to pay upwards of $50 per month with some discounts for current users are part of the pricing strategy. The product you choose is still installed on your computer, you download and install it rather than using a DVD. The major difference is the license activation which may be monthly or longer depending on your payment model. That means, at an inconvenient moment when you have no access to the Internet your license may need to be reactivated in order for you to use your product, oh, sorry Adobe’s rental! They argue that there is a grace period of something like 9 days, but what if you had just started a three-week safari in the middle of no where?

When I used to teach various courses in marketing, specifically those related to strategic issues, we used to discuss the benefits of subscription-based models. From an abstract strategic viewpoint many products may lend themselves to this model. But, and there is always a but, any good business model must create a value for the customer in order to succeed. Not to brag, but I say these as a professor of marketing emeritus.

This move by Adobe created a flurry of activity of comments, responses, discussions, and I will add my humble opinion to this opinion soup. You can see the flood of discussion on an Adobe blog by Jeffrey Tranberry. There are many point-counterpoint arguments which I do not want to repeat here. The points I want to make are:

  1. I consider Adobe Photoshop CC not as Creative Cloud, but Captive Consumer.
  2. Adobe seems to be focusing on the big corporate users and the “serious creative” types, whatever that may mean and will probably not mind losing those consumers who may upgrade to every new version or may even skip a version in between upgrades
  3. Their explanations are very self-serving, including the price one pays for this thing. In most, if not all the arguments Adobe staff provide to rebut complains they use the price of the full product purchased for the first time. Most users pay the upgrade prices which are much lower than the full product.
  4. It should be VERY clear that the discount offered to current owners of CS3 and up is ONLY FOR THE FIRST YEAR after which welcome to the group known as Adobe Captive Consumer, thank you!
  5. The staff also diminish the unit of measure to daily cost and argue with a line “isn’t it worth $0.33-$0.66 a day for a tool you use?” Quaint, but not robust. The argument for a tool being worth a few pennies ignores the fact that in most trades, the user of the tool gets to keep the tool for which they pay for rather than the tool suddenly vanishing. I wonder if a Snap-On sales person can make this argument to an auto mechanic! After your “inexpensive” daily rental for the tool chest expires it gets locked up!
  6. The Creative Cloud is a euphemism, the real thing being sold is the requirement for frequent license activations. The additional storage and sharing may not be of much value to most users. This is the real reason, monthly validation of your license, behind this model. That’s why I chose the expand the acronym CC as Captive Consumer not as Creative Cloud.
  7. Subscription model eventually generates a higher revenue stream for the seller, which is obviously attractive for Adobe. Also this proposed model presents very strong disincentives for the consumers to leave the subscription since cancelling it leaves them with NO product to use.
  8. The announced business model principally benefits Adobe and creates some hyped up benefits to the consumer, like no need for updates, easy installation, and such. They are all peripheral, secondary, even tertiary benefits. Whereas being left with NO product to use after, say two years of subscription is a VERY REAL disincentive for the subscriber. So my expansion of the acronym Captive Consumer fits very well.
  9. Yes, there are other subscription based software out there, like antivirus software. But, in that case the consumer is buying only the protection and the software is not used to create anything. Furthermore, consumers can seamlessly switch from one brand to another since the benefit bought is the protection against computer viruses.
  10. Adobe will do well to reconsider and choose not to force users to this high-cost subscription model. I am including the cost of switching to something else in the cost calculation. If “serious creatives” choose to subscribe to Captive Consumer, that is perfectly fine. But the “less serious” or “less creatives” would very much like to purchase a product and be able to use it for as long as they wish.
  11. There are subscribers who tout the benefit of the CC, that’s perfectly fine. But there are many times more users who side with the product ownership model. Yes, I know even the DVD delivery does not give ownership of the product, but that legal point is not the essence here.

Clearly, Adobe must have weighed all these points and have found answers that satisfy them. The question is how well the consumers will be satisfied with the answers offered that seem to use, perhaps not wittingly, euphemisms, over simplifications, diminishing the importance of being locked out of software, or will the “less creative” ones will seek other alternatives to satisfy their needs. As Adobe is free to choose any business model they like, so can consumers decide on which company they would like to patronize.

Time will tell.

Comments

  1. says

    Thank you for your article and insight. Of course Adobe expects criticism of their CC policy but they may get way more than they anticipated. To cause such ill-will, anger and frustration in such a short period of time is startling, and in my opinion, well deserved. Adobe management may stonewall these protests but it will not eradicate the unnecessary damage it has done to its reputation and customer base. This is obviously a case of poor decision making and execution on Adobe’s part, even if they get away with it.

    • A. Cemal Ekin says

      There is a lot of truth in what you say, and many others reiterate. In the end, it may be a liberating effect on all “former” Photoshop users. I remember reading in the thread a comment which said something like “Corel cannot believe their eyes!” All said, big companies may get away with this kind of decisions, at least in the short run, because of inertia and momentum. In marketing I taught, “satisfying consumer needs to meet organizational objectives” was the cornerstone of marketing. Well, …

  2. says

    Perhaps it is time for some serious review of alternative image processing products that would augment Lightroom; to do the functions (layers, blending, etc.) for which we use PS. There are other plug ins that do some of the specific tasks like stitching panoramas or focus stacking..

  3. Laura Landen says

    I agree whole-heartedly with you, Cemal, about subscription software. Microsoft Office seems headed that way, too, although a non-subscription version is still possible. I use a bibliography tool called “EndNote” which is currently also having a split-personality crisis. As much as possible, I try to avoid things with monthly subscriptions, although that’s obviously not possible with some things. There are free versions of Office, although with some limitations. With PhotoShop and LightRoom, though, once people are so heavily invested in time, effort, etc., what’s the alternative?? I’m willing to scream loudly now, but am enough of a realist (pessimist?) to think it won’t make much difference in the end.

    Thanks for your heads-up on the Captive Consumer shift.

    • A. Cemal Ekin says

      We’ll see where this will go Laura. There are many disgruntled users but that does not mean Adobe, or any other big corporation will change their decision because of that. Remember Netflix?

  4. Blair Thornton says

    I forsee a lot of consumers rebelling to this Captive Subscription model. I for one will stop upgrading my Adobe Products.

  5. Sal Capirchio says

    Hey Cemal-

    In reading your blog post….I just want to be clear, if I’m interpreting this correctly…will that mean that ‘soon’, you will not be able to purchase “CS 7″ for example, in the normal fashion? (Or is this specific only to the Adobe suites of packaged products?)

    Once you have an Adobe Account (of sorts), you will purchase a license and the software will run mainly in a cloud environment? That said, no Internet – no image fixes?

    By the way, I believe in a similar fashion, this is the way that Microsoft intends to be going to market with their MS Office products in the future as well. Not that I agree with the thought process, but it appears that Adobe is not alone with this future methodology.

    To your point regarding the safari or similar extended trip; if you are away will you be able to “pre-purchase” the licensing for that extended timeframe? Will they build that type of algorithm in the software to accommodate for that? It does sound like this has pain written all over it. Or maybe I’m looking at this wrong…it might create a ton more customer service jobs at Adobe to deal with all the licensing issues!
    -Sal

    • A. Cemal Ekin says

      Sal, “Yes, we have no bananas!” No more buying a packaged Photoshop or any other Adobe suite product, singly or in bundles. You will purchase the subscription and download and run the software on your computer with access to your storage if you like. As I said, the main change is forced periodic product activations. You will be able to use the product on the road with no Internet access for a while but eventually you need to activate again, unless you are without a connection too long.

  6. AnastasiaBeaverhausen says

    What everyone has been leaving out which is paramount in my opinion, is the fact that once you begin working in Adobe CC and cancel your subscription, all of you files become READ-ONLY therefore, not editable until you cough the dough to subscribe again. Over the course of a career, this translates into tens of thousands of dollars. Graphic design salaries top out at 80k so who will be able to afford this over the long term?

    I used my CS for 10 years until I could afford to upgrade but I am still able to open all of my old files. What adobe is doing is extortion, plain and simple.

    • A. Cemal Ekin says

      It is an interesting point, but I believe you can save your files in TIFF format and keep them locally on your computer. This, I do not know first hand, just basing it on what others have commented. That said, why should I be denied full access to MY files, your point is well taken.

      • AnastasiaBeaverhausen says

        A tiff does me no good when I need the layers and have no product to edit those in.

        • A. Cemal Ekin says

          TIFF format uses layers, that’s not a problem. Your files suddenly turning into read only is. Even if you can still convert to TIFF by opening and saving them in TIFF format, the extra, and possibly extraordinary effort it would require is a burden on the user and a disincentive to quit. There may even be an analogy to drug addiction, it may be over the top but still apropos. First few rounds of an addictive drug may be free, thereby locking in the user. It is the later need to use it creates havoc.

          • Richard R Vallon Jr. says

            Thanks Mr. Ekin- I have decided not to join Creative Cloud and will take up cocaine addiction and solve crimes like Mr; Sherlock Holmes. Anything but get taken giving Adobe a monthly payment! Rebels- to the ramparts!

  7. Frank Mullins says

    I have been using Adobe products since Elements 2. I upgraded to Photoshop CS5. Presently, I am using Photoshop CS6 and Lightroom 3. I have no need of any other Adobe products. I also do not need the extended version of CS6. My investment in these Adobe products gives me no financial gain. For me, photography is passion, something I greatly enjoy, not a way to make money. I have not sold any of my photographs. Any competitions I have won, gain me a ribbon, nothing else. I simply cannot afford a subscription service, especially when the subscription may include products I don’t want or need. So, I guess my reliance on Adobe for image editing software is ending. Any future versions of Photoshop will be unavailable to me. I just don’t have the financial resources to pay a subscription for the rest of my life. And that’s what it would be. The minute I stop paying the subscription fee, I would no longer have access to Photoshop.

    Adobe has made a decision that, for them, may be financially sound. For businesses that use many of the Adobe products and make their money using these products, the subscription model will work well and probably save money for them. But, for many thousands of us, this model will cut us off from these products. We are being put in a position that is financially untenable. We are being put in a position that requires a lifelong commitment to Adobe. It makes no sense to me.

    We can only hope that maybe, just maybe, Adobe will reconsider and make some concessions.

    • A. Cemal Ekin says

      Many agree with you Frank. Hang on to your Photoshop CS6 and Lightroom, that will serve you, and I, well for years to come.

  8. Gordon says

    Hi Cemal,

    Just discovered your site after you posted on Adobe’s ‘NOT Answering Your Questions’ site. I totally agree with everhing you have said. I can only imagine that Adobe’s executives sat down in a chair, took very careful aim at their foot and pulled the trigger.

    I have posted a few questions and comments on that site but have not received any answer whatsoever, while safe, sanitised, questions get an immediate answer. In the flurry of angry questioning it almost seems as if Adobe are posting the ‘nice’ questions themselves so that they can answer somebody; or am I just being cynical? It seems that any question that is critical of Adobe is ignored which, in itself, displays rudeness and arrogance towards their customers who are genuinely concerned about what is happening and need answers.

    When Quark displayed the same attitude Adobe came along with InDesign. The rest is history. One might have thought that Adobe execs would have remembered this.

    I love using Photoshop but as soon as Corel gets its act together with a MAC version of PhotoPaint I can see myself going over – never did like having a gun at my head!

    … and on the piracy front, I can only see this making things much, much worse for Adobe as the pirates now have a terrific incentive to write code for a workaround.

    btw loved your Orchis video

    • A. Cemal Ekin says

      Thank you Gordon for sharing your thoughts. I did notice a decline in the answers, partly dodging some questions and partly being overwhelmed by the posts. I posted a new question about the legality of the matter and I do think there are legal issues afoot here. There are a series of US laws that protect consumers and competition. This move by Adobe with the captive nature of the subscription may trigger some action, class action perhaps.

      I am glad you liked my Orchis video, the ballet performance was even more impressive.

      • Gordon says

        Thanks Cemal. Interesting thought about a class action as it does seem to me, as a pure layman, that there is something of a ‘not quite legal’ situation here. I think that consumer groups here in the UK would be looking at this.

        When she has time I shall show my wife your video as she is something of a balletomane. We go to Covent Garden quite regularly.

  9. Richard R Vallon Jr. says

    Well I’m not going to do it- I’m not going to let Adobe hold me captive.
    Screw Adobe! and I guess you think I’m some poor college student- well I’m a 55 year old professor that teaches photo classes and i’ll now get serious on looking for alternatives to any of Adobe’s locked up Creative Cloud products. I’m so sick of paying for Photoshop over and over again- still the same bugs- still frustrating and hard to use. Nearly impossible to teach it too !

    • A. Cemal Ekin says

      I’m sure you are not alone. Share what you find as a replacement. I think a very viable option is to stay with PS CS6 and Lightroom for a while. The dust will settle and some contenders will emerge. For anyone who does not need the “latest and greatest” there is free CS2 which has most of the core functions of Photoshop. Pair that with Lightroom and it is still a very capable combination.

  10. Tony says

    Cemal, hope you don’t mind the following.

    Even though it may be a while before before CS6 is dead, because of OS upgrades, hardware limitations or what-have-you there are alternatives. Now I totally understand anyone’s hesitation about considering replacing PS altogether, I’ve been running PS since V.2.0 not CS2, V.2.0, ya I’m old and I hate learning new tricks. I found the following article that points out a few that may fit your needs. Not perfect replacements, but something to consider.

    http://www.creativebloq.com/photoshop/best-alternatives-1131641

  11. Herb says

    Something thats is mostly overlooked in recent discussions about Adobe’s Creative cloud is the new business model of Adobe.
    Where as in the past Adobe had to innovate their software in order to sell new versions of their Creative suites, nowadays, with the creative cloud concept, the need to innovate is vastly decreased because of the fact that they will get their money anyway. The CC subscribers can’t go anywhere without forfeiting the ability to open and edit their work.

    The cloud concept will bring Adobe a huge profit on many levels, they have regular income, they can reduce research and development costs, no more dvd production costs etc..

    So the expectation of many CC subscribers to annually get new features could well turn out to be a big disappointment.

  12. Alan says

    I’m 76 years old, and I’m certainly not going to sign up to cloud, I’ve purchased every Scott Kelby book on PS so won’t be purchasing his books or any one else’s on PS, so these people along with magazines will lose out!

    • A. Cemal Ekin says

      Photoshop CS6 will do everything I need, heck even Photoshop CS5 will do the same. The seduction of the new features has kept us on the upgrade path all these years. Now, we don’t even need to upgrade Photoshop. Think about the savings!

  13. Miles says

    Great article. I have to confess I jumped on the bandwagon and subscribed to the creative cloud a week ago, being a CS6 user you get a good deal for the first year and this drew me in. I am a independant graphic designer and predominantly use Indesign and Illustrator as well as Photoshop / Lightroom in my workflow. With Indesign and Illustrator the files are not compatible with older versions of the software unless you use their rather unreliable ‘backward compatible’ file formats. Although the new software was great I increasingly found myself not using my new CC apps as it slowly dawned on me the level of commitment this required: a lifetime subscription with adobe with the threat of no further access to my files should I switch software a few years on. I cancelled my subscription today but I am genuinely concerned about the future.

    • A. Cemal Ekin says

      Miles, it is great to hear from an actual CC user. You are correct, it is a life time commitment, that’s why I called it “Captive Consumer”. I have the latest Photoshop CS6, will probably upgrade to LR 5 after the bugs are cleaned, and live without the upgrade costs! It is kind of liberating to think: no upgrade costs!!! ;-)

  14. says

    I am so glad a marketing professor stands up to cynical Captive Consumer scheming. As a longtime fan and low-budget professional user of Photoshop and InDesign who routinely let several versions go by before upgrading, I had a chance to object to Adobe’s Captive Consumer strategy in their marketing survey a couple years ago. I told them that for me their feature improvements generally weren’t worth the cost of keeping up with every upgrade.

    Adobe chose the subscription-only scheme anyway, apparently in hopes of squeezing a permanent entitlement out of daily users who work in high-priced companies.

    I can only hope the subscription-only plan falters, that they not follow the same scheme plotted by Microsoft, whose Office monopoly is more gravely threatened. With Photoshop Elements, Adobe went after a larger advanced-amateur and “prosumer” market segment — and served it well by offering 80 percent of the functionality at 20 percent of the price. I hope a similar concept (“InDesign Elements?”) comes along promptly, or many of us will have to repeat the annoying transition we made to InDesign when Quark chose to ignore customers’ interests.

    Impressive software competence has helped build Adobe’s market power, but this latest scheme has the anticompetitive smell of its past strategies — buying such rivals as Aldus (PageMaker) and Macromedia (Dreamweaver) and devising proprietary formats (Flash, initially).

  15. David Kachel says

    Hmmm. Adobe has failed to consider:
    If we can’t upgrade because we don’t want anything to do with their Captive Consumer plan, then we can’t risk upgrading operating systems either, because a new OS might break the frozen-in-time Adobe products we are now forced to use in perpetuity.
    I wonder how Apple and Microsoft will feel about not selling OS upgrades to all the users of Adobe products because Adobe wants to squeeze those users?

  16. jewelia says

    Autodesk has also moved to subscriptions. Are we looking forward to a world where the only media is corporate media as individuals will not be able to afford, if they can own it at all, the means of expression? What I am fearful of is that software companies are complicit with corporate consolidation of the means of expression along with most every other facet of our lives. At the same time, Verizon is pushing Congress to allow it more control over the internet as if I will be able to afford to stay on line in a few years. I surrender. All I need is my chimp implant so that i can update to a single subscription service and sign into my assigned cell and plug my self in. Pay my monthly fee which is ensured to be more than i will ever make to enforce that i will be perpetually indebted. Mercifully, in my dependent delinquent state, my soylent green, sedatives, media, and virtual life will still download in a trickle from the clouds and, in my stupor of virtual content, I can just sit in the middle of what fantasy i have left and moan ughhhhhhhh! for no purpose of my own.

  17. Please strike against Adobe products says

    Adobe has lost me as a user until they fix their CC scam. I had a legitimate product key that I had asked a few years ago, if I could get it transferred from PC to MAC. I talked to them about it again, and I was denied but the customer associate that helped me via phone was rude and insensitive. He insisted that i’d be saving in the long run to have the most up to date software at all times and that I was being dumb for not wanting to transition to CC. He also insisted that all the users he has talked to have always wanted the most up to date software all the time. Which is whole load of BS. When I told him most users can use one product suite for many years until they decide to upgrade he continued to badger me that I was being dumb and I was a unique case. Upon asking to speak to a higher representative or get the hold of someone else to talk to told me that was impossible and he had no use to have such information around and shortly we hung up.

    Adobe’s new CC policy prevents many aspiring digital artists to use their products. It simply takes out the process of wanting to be creative at your own leisure, versus always feeling like you have to be creative within a certain time period. Those who sign on to CC in the long run pay more than a stand alone product that could last them many years. I believe the lack of competition for such companies has allowed them to be snooty about their products. I hope that many users will look to other software to make a statement against adobe. Honestly, this is why most users look to pirate the adobe products. Adobe has such a scam policy where they can ask for hundreds of dollars for their product and not provide any assistance on transferring it to a different computer when they release a new product, and now CC. I just can’t stand what a terrible service I have received from Adobe over the years, and I can’t justify their price point for their products. What makes Adobe special is in fact the works users create using their program. We as artists make the program desirable because we display our work using that program. I’m sure if users can make beautiful art using low grade art apps on a tablet device, then Adobe is not something anybody really needs. You don’t eat at a restaurant that gives you terrible service, period.

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