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Adobe forecasts subscription increases and slower revenue

By dpreview staff on Sep 20, 2012 at 21:01 GMT

Adobe has reported that earnings for its current quarter will remain flat or decline as customers have signed up for its Creative Cloud subscription services at a faster than expected rate. On this basis, Adobe has predicted Q4 earnings of between 53-58 cents per share on expected revenus of between $1.075 and $1.125 billion, falling shy of analysts' estimates. This reflects an expected 25,000 additional Creative Cloud subscribers. Although the flock to a monthly subscription service hurts short-term revenue, Edward Jones analyst Josh Olson says, 'The long term takeaway is that it's a good thing.'

Adobe launched Creative Cloud in April, providing access to its CS6 suite of imaging, editing and design tools including Photoshop and Lightroom 4 on a monthly subscription, rather than ownership basis. Subscribers can download and install as few or as many of Adobe's CS6 applications as they require and utilize 20GB of online file storage space.

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Total comments: 20
Jim in AZ
By Jim in AZ (Sep 22, 2012)

$89 PS would be a dream and might actually make more money for Adobe.

1 upvote
By pumeco (Sep 23, 2012)

Jim, was that sarcasm or have they hinted somewhere that PS would sell for $89?

I can't stand overpriced rip-off merchants, but if Adobe are offering to sell the full version of Photoshop for that price, it would be worth me buying a copy.

By Mollysnoot2 (Sep 23, 2012)

No chance of Adobe dropping the price of PS to $89... Sounds like Jim is just dreaming out loud? :)

By pumeco (Sep 24, 2012)

Thanks, I thought as much ;-)

By eschelar (Sep 25, 2012)

I think I did OK recently.

I purchased an intermediate suite - CS5.5 Web Premium - in a University store. Total cost at that time was a bit shy of $400 US. PS, Illustrator, Dreamweaver and InDesign for basically $80 each. But Student limited of course.

I upgraded to CS6 Production Premium because I needed Premiere and Dreamweaver/Flash is becoming less useful. Cost an additional $420 (tax).

Total cost = $820
Significant Programs - PS, Illustrator, Premiere Pro, After Effects, Audition (no InDesign) = 5 programs fully licensed for any use. $160 average cost, $80 per version per primary program.

Worked well for me.

By xfoto (Sep 22, 2012)

It still doesn't help all the people who download their over-priced product for free

Rooru S
By Rooru S (Sep 21, 2012)

CS4 will do just fine for years.

1 upvote
By ewelch (Sep 21, 2012)

Of course subscriptions are growing with the draconian rules. No more skipping upgrades or you're paying full price. For all those with 5.0 or earlier when subscriptions started.

The hostility towards Adobe's customer-unfriendly policies seems to be increasing even more. I dropped owning the Creative Suite. Now it's Lightroom and Photoshop CS6. As a pro I have to have the latter. So I paid for the upgrade for the boxed version which is way cheaper. I'd like to have Acrobat Pro, but it would be cheaper to pay $50 a month for everything. And Acrobat Pro X is such a mess of a program in terms of usability that I just can't justify paying for it.

Ily I do have the creative Suite at work, so I have access to the programs. But no longer at home.

By Vallkar (Sep 21, 2012)

I don't like the idea of subscription for software. I have used Adobe products for past 22 years and have regularly upgraded. My last upgrade was a CS3 suite. I did not upgrade to CS4 or CS5 - I am quite happy with CS3. As I have missed 2 upgrades I may not qualify for an upgrade as per new Adobe upgrade policy (one wonders if these upgrade charges are really justified as the improvements over a previous version is not that huge. Lot of these improvements can be supplied as plugins I am sure). I believe Adobe will lose out on some loyal users because of these upgrade ideas they have.

Comment edited 1 minute after posting
By JayFromSA (Sep 24, 2012)

I agree, CS3 is a powerful program, that could even today almost be the gold standard if it was the latest edition. I upgraded from CS3 to CS5. The difference was huge and worth the money. Even the ACR upgrade alone (I forget the version numbers) was worth the money. However, the subscription idea is a bridge to far. Perhaps I shall still upgrade to CS6 and that would be that. The run on subscriptions, I suspect, would peter out in the end when Adobe raise the price on that... and they would.

By jeep (Sep 21, 2012)

Of course Adobe should never have been allowed to take over Macromedia giving them a 'freehand' (no pun intended) in the professional graphics arena. Pricing of Photoshop upgrades increased, because there was really no where else to go.

By m3 (Sep 21, 2012)

@ andrew turner
Adobe has been doing everything wrong (from the economical standpoint) for years.
I remember sending them this at least as far back as 2005:

"While there is no doubt that your software engineers are the best in the world, your head-in-the-sand attitude on pricing is downright stupid. If every one who has PS on their computer had paid just $100 for it instead of pirating it because you think charging ten times that (yes I mean beyond US borders - rip off policy again) will make it look better, your revenue would have been substantially larger."

Did they take any notice? No, they just keep desperately spending more money and complaining about piracy inventing ways to stop people grabbing a free copy.

As Forrest Gump would say: "Stupid is, as stupid does"; that's Adobe for you.

By mmcfine (Sep 21, 2012)

As a subscriber and a very long time Adobe customer I think Adobe are trying to find solutions for there shareholders. PS is long gone from it's core intension and as for other Adobe products, the competition is strong.

Saying that, the subscription is still probably the best option for freelancer who do not want or need a full priced software and can easily stop and resume the subscription.

andrew turner
By andrew turner (Sep 21, 2012)

As a shareholder, as well as a longtime user of Photoshop and the creative suite, I can say without hesitation that Adobe is doing just about everything wrong.

By Sjakie1956 (Sep 20, 2012)

Today I was at the Photokina, the largest exhibition in the world of Photography.
Adobe wasn't there.............
Arrogance or ignorance?

By keepreal (Sep 20, 2012)

No way I would spend the huge price for Photoshop. Far too expensive, good though it is. I originally had Elements 2 and but won a copy of CS2 in a competition in a photo magazine where Martin Evening judged the entries. He said he could not see any evidence of where I had done extensive editing to remove several distracting elements from my picture even though I also sent him a copy of the original. That was what I could do with just PSE2.

I am still using CS2, would not dream of upgrading and paying out serious money. I have run later trial versions but saw no benefit except a complicated interface replacing the streamlined one with CS2 that screamed out "don't feel the quality, just the width" to borrow a phrase. I now use Oloneo PhotoEngine beforehand and that converts more recent RAW while giving superb tone mapping.

You can do a lot without lining Adobe's pockets with upgrades. Many people who do have their heads in the clouds, now it seems some rather more literally.

Comment edited 2 times, last edit 6 minutes after posting
By ArmandN (Sep 21, 2012)

Depends on whether or not you're a professional. Am I (not a professional photographer, but a designer). The upgrade price is next to nothing when you can save time and deliver a better job because of better tools.

It's like saying you don't need a Canon 5D MkII/III or a D800 for photography. Of course you don't. But if it's photography you're doing all day long, every bit of help the camera (or software) can give you counts.

By keepreal (Sep 21, 2012)

By ArmandN, you are totally right of course but I am talking about the amateurs who just have an urge to spend, spend, spend. That is probably one good reason why the manufacturers update their models every few nanoseconds.

By nonuniform (Sep 20, 2012)

There's no value to existing customers of individual apps, the upgrade is still a better deal. If you plan to upgrade to a full CS suite, then, the sub makes sense.

By steelhead3 (Sep 20, 2012)

I would have upgraded if the price drops to ps6; they brought in new customers with their sale of full ps6 but abandoned their existing customers.

Total comments: 20