I have been a user of Adobe Photoshop since version 3.0 (introduced in November 1994). I had purchased the Aldus Software Collection earlier that year (containing  PageMaker, FreeHand, PhotoStyler, and Persuasion) but Aldus was aquired by Adobe, and they decided to migrate all existing customers to Photoshop. Which was fine for me as Photoshop was far more powerful than Photostyler at the time.

I upgraded Photoshop every now and then, usually when new and cool features where introduced – for example “Editable Type” with version 5.0, “Healing Brush” with version 7.0. I did also upgrade when I moved to RAW processing (CS2), and when I upgraded to a 64 bit system (CS5). All-in-all I probably purchased four or five updates.

In my view, Photoshop was complete with CS2, but I am a happy camper with the 64-bit version of CS5. I looked at upgrading to CS6 but decided that the lack of innovation is not worth the investment. Also, after 18 years with Adobe, I realized that they are increasingly unable to build reliable, solid software. Upgrades always introduced new features – and new bugs. Their introduction of Lightroom was a complete mess, at least from a technical point-of-view. Version 1.0 of Lightroom contained so many awful bugs that it still surprises me how Adobe could get away with it.

Anyway, last week Adobe announced that they will discontinue “perpetual licences” and offer just “subscriptions” for many of their products, including their flagship creative products Photoshop, InDesign, Premiere, and Illustrator. So instead of paying a moderate one-time fee for a software upgrade that introduces new features that you can continue to use as long as you want, Adobe charges a monthly fee to be able to use their software. There is A LOT wrong with this approach, even if Photoshop CC (that’s the name for the subscription service) seems to be at a similar price level as before.

Let’s do the math: Over the past 18 years I purchased 5 updates – that’s one update about every 43 months (or 3.6 years). Let’s assume the update to cost $300 (it’s been more because I had to order from the European Adobe Store at unreasonable high cost), so it boils down to an average cost of 5*$300/18=$83 per year. Now Adobe will charge $20 per month for just Photoshop CC. In the shop, it is not apparent that there are discounts for existing Photoshop customers. So, under the new pricing scheme, for 4 years of usage I have to pay 4x12x$20=$960. Compare that to the cost of 4x$83=$333 (over 4 years) I would have to pay under the old regime model – that’s an incredible price increase. (Of course, if you purchase each and every update, the calculation is not as dramatic, but still significant. Just ask yourself whether you spent $480 every other year for a Photoshop upgrade.)

And who came up with their Euro pricing? For an identical product they charge 24.59 Euro, which at the time of writing converts to $31.72. That’s a massive 58% premium for a copy downloaded to Germany. OK, they have to cover localizations and provide (some) local support, but 58% surcharge? I’d be happy to work with a plain US version and refrain to use any of their customer services – if only they offered me the US pricing. But they don’t, and this makes their bizarre pricing even more unattractive.

But it’s not just the pricing that is wrong. It’s the legal terms associated with the contract. Macperformanceguide.com has published a beautiful review that actually reveals all the hooks in the contract. To summarize: You have very few rights, and Adobe have very few obligations. They can basically do what they want. Not good.

Are they insane?

No, they are certainly not insane; after all, they have been a pretty successful software company so far. There must be something I am missing. There must be a simple reason for their actions.

Here’s my take: They realized that not just the photo editing software has reached (near-) perfection, but also the photo equipment itself. Clearly, there has come an end to the pixel mania of the past. You can only put so many pixels on a full frame sensor, and who needs these giant images anyway? These require just faster hardware and bigger hard disks without adding genuine value to photographers, or their customers. Print publications are slowly dying, but they were the only ones demanding very high resolutions. And of course those customers who do super-sized photo prints. Most customers are happy with the resolutions that are available today (16 to 32 megapixels), and photographers are happy as well with the status quo. They do not need to upgrade their hardware any longer, and they do not need to upgrade their software any longer. But if they want to significantly improve their  image quality – they will consider investing in new, faster lenses that offer built-in image stabilizers and dramatically reduced distortions.

All this is very bad news for Adobe. They know that they can not continue to invent new, cool features for their software to keep up demand. Their software has reached near perfection long ago, and each new version will find fewer and fewer customers willing to shell out the money for that specific upgrade. If they continue to run the business like that, it would mean the end of the business UNLESS they are able to replace the expected missing income by some other, new, steady revenue stream. Which is why they now force Photoshop CC upon all their customers.

On top, Adobe will see dramatically reduced cost:

• They have to manage just one codebase (instead of one codebase per version)
• They do not need to produce physical boxes
• They do not need to distribute these boxes and pay distributors
• They have little pressure to upgrade the product and can reduce their development efforts

Add the hefty price increase, and you see how they might alienate from many of their existing customers.

The photographer community has reacted with a previously unseen backlash. Dpreview has run a poll on this. Do yourself a favor and skip to the comments of that post. It is no surprise that photographers do not share Adobe’s concept. They experience an industry in heavy weather, with some markets reducing their spending for images dramatically (e.g. print publications and even news agencies). In such a situation, photographers do not want to take on additional fixed monthly cost. Rather they want to keep earning money to get through the crisis with their existing hard- and software and upgrade only for essential features required by their customers. As such features are not in sight, most photographers postpone the upgrades, waiting for better times.

Meanwhile Adobe’s competitors are gearing up. They feel for the first time in years a chance to compete with the big dinosaur that used to provide the de-facto standard oin photo editing. Corel, GIMP, and many others will be happy to see new users. It remains to be seen whether Adobe has correctly predicted the adoption rate of their subscription service, but it’s clear already that many photographers would like to see the giant tumble.

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P.S.: Here is a must-read article on The Register.