Adobe: Cloud gives 'best value' for users

Subscriptions for pay-as-you-use software needs to be viewed in terms of the "real" value from online access to tools and collaboration, says Adobe exec.
Written by Jamie Yap, Contributor

SINGAPORE--Getting to easily store and share content online as well as immediate access to new updates are benefits of using cloud-based software that should be at a subscription price which "well and truly" supports this real value.

That's how Adobe Systems hopes to convince more customers to use the cloud version of its creative media and digital marketing software, according to Craig Tegel, regional president of Adobe Japan and Asia-Pacific.

"We are steering customers to the cloud [as it gives them] the best value in the most affordable way. We see cloud to be the future of how people access software, from getting software updates to storing and sharing [their content]," said Tegel in an interview here Tuesday.

Adobe is continuing to push forth its cloud business and aims expands the user base for its Creative Cloud and Marketing Cloud software suites.

Since 2011, Adobe has been increasingly shifting the focus on cloud for its software, away from the traditional boxed version and perpetual licensing to renewable online subscriptions.

Adobe's cloud strategy comprises media creation and digital marketing software tools, packaged as Creative Cloud and Marketing Cloud respectively, and offered on a software-as-a-service (SaaS) basis via monthly or yearly subscriptions.

Last month, Adobe reduced the price of its Creative Cloud offering in Australia a day after it was summonsed to appear at an IT pricing inquiry hearing, together with Microsoft and Apple. The inquiry began mid-2012 to find out why their products were priced higher in the country compared to elsewhere.

Tegel said because the delivery of SaaS is different from perpetual software license, the pricing model between the two will also differ. The various different mechanisms come into play in the pricing strategies of cloud software, which the company constantly reviews worldwide, he added.

Asked how far subscription prices influence user adoption, Tegel said the push to cloud is ultimately about the benefits that are the real value to users. "The value [users] get from cloud should well and truly support the price they pay per month."

Customers who stay with the ongoing renewable license get greater value than if they stick to the perpetual license and wait longer or do not upgrade the software, he added.

Besides getting Web storage to store and showcase their works, users also get access to community features to collaborate and share with others, all of which are integral to creative design user communities, Tegel said, referring to the Creative Cloud suite.

The other major benefit is speed due to shorter waiting times for software updates, he noted. Before the cloud, new versions of Adobe software came every 18 to 24 months, accumulating all the feature updates within that period, and users had to go buy the "box" off the shelf, he explained.

"[But] with cloud, there is no waiting 18 months, and the latest features come to you. That's the real value. It is apparent that customers need access to the latest and greatest much faster, in fact, as soon as they are available.

"The best way to deliver that is through the cloud experience," he said. Furthermore, the emergence of fiber and faster bandwidth speeds seeing demand also help drive adoption of cloud tools, he added.

To help boost its cloud services uptake, Adobe will focus on educating the value proposition to users as well as resellers who likewise can explain the benefits to customers, Tegel pointed out. "We're beyond the 500,000 and moving to the next group of people," he said, referring to the number of Creative Cloud subscriptions worldwide since the service was launched in April last year.

In Asia, Creative Cloud is currently available in Singapore, Indonesia, Malaysia, Thailand, the Philippines, Hong Kong, Korea, Australia, New Zealand and Japan. It comes in editions for individual users and teams.

In the U.S., for example, the Creative Cloud edition for individual users is US$49.99 monthly and allows access to all the applications in Adobe's Creative Suite, which includes Photoshop, InDesign and Illustrator among others. This is compared with the price of US$699 for, say, a standalone copy of Photoshop.

Subscription plans for single apps are available as part of the Creative Cloud offerings, but Tegel said the majority of users take the complete version because people today increasingly use more than one tool to create a range of media and digital content.

In Singapore, only Creative Cloud for teams is currently available at US$840 per year. Tegel said he expects the individual version to be rolled out here in the second quarter of this year. He declined to give figures of current Creative Cloud subscriptions in Singapore.

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