Autodesk Subscription versus Perpetual License

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Autodesk Subscription versus Perpetual License

Let’s have a look at Autodesk Subscription versus Perpetual License. Many users used to prefer perpetual license of software instead of subscription. What is the main difference?

Autodesk stopped selling the perpetual license of its software on January 31st, 2016. When perpetual licenses were sold, they also came with a maintenance plan that about 50% bought yearly to keep their version of software current so that they can exchange drawings with ease. Also, the maintenance plan came with support to help users with software problems, advice, etc. The price of the maintenance was typically 10 to 15 percent of the retail price of the software.

Perpetual software cost a lot more initially

The price of a perpetual software was about three plus times more expensive than a yearly subscription of the same software. Buying perpetual license caused a cash flow strain on many buyers and hence reduced number of seats and suboptimal for productivity.

Casual Users

A common reason raised by casual users is that they can use the software once a while or even a few years later as needed without having to pay anything in between. This will be true if the user do not purchase the yearly maintenance plan. Common problems these users face is outdated versions and “lost” software. They cannot remember who last used it and which PC it was installed on and how to activate it again. Other issues are when their PC breakdown, hard disk gets reformatted, virus attack. Without a maintenance plan, user do not get support from Autodesk and their reseller. Much time is wasted sorting these issues out when job deadline looms.

Why pay more now for sometime that you only use in the future? Cash flow is an important bloodline of companies and preserving it with subscription makes sense. Also, there are other accounting benefits of subscription.

Asset versus Expenses

Perpetual License is classified as asset and subscription as expenditure. This affect the yearly profit and loss account and also the income tax payable of the company. In short, subscription can reduce the tax payable as it is expensed off for that year.

Consumption Model of Subscription

Subscription is a consumption model. Use as many as you need and stop whenever you do not need it. Do not pay extra for the future for a just in case scenario as subscription is three to four time cheaper than a perpetual license. It is easier to budget and plan with renewals of subscriptions.