Perpetual Licenses No Longer Available After January 1, 2018

[TomU]

For those who haven't seen it yet, PTC has officially announced that perpetual licenses will no longer be available for purchase starting January 1, 2018.

"...effective January 1, 2018, new software licenses for its core solutions and ThingWorx platform will be available only by subscription in the Americas and Western Europe. Customers in these regions may continue to use their existing perpetual licenses and renew support on active licenses."

Yes, this includes Creo, Windchill, etc.  The only exception is Kepware.

Additional information available here:

• PTC Subscription | PTC
• PTC Accelerates Subscription Business Model in Select Regions | PTC

[bmüller]

Hi,

as far as I understand, if we pay yearly maintainance anyway, the offer to swicht perpetual licenses to subscription is quite interessting.

Since we get free simulate and ISDX licenses. Furthermore we save extra maintainace cost for those packages.

plus the alignment of old packages to Creo Essentials.

Is there any chance that PTC will NOT increase yearly maintainace cost for perpetual.

or am I wrong?

br Bernhard

[bmüller]

---

I, as others am keen to help here but now I am disinclined to participate any more. To me it seems PTC have withdrawn their input (presumably made them all redundant) as I assume they see the users performing the support function themselves, at their own time and expense and in exchange for kudos points.

Users who advance therefore find themselves lonely and eventually the only purpose of maintenance is to get software updates. I think PTC use this forum and our accumulated knowledge to benefit their bottom line and fail to support more advanced users in return.

Although this may seem somewhat oblique to the original thread, it is not. It offers up something immediate.

One possibility is that users simply stop using this forum and convene elsewhere in private to provide mutual support. Somewhere PTC can't ‘leverage’ (their favourite word). But that is a huge amount of effort and someone would have to organise it 

at least they offer this forum...

I have seen "private" solutions (e.g. facebook groups) in other areas. I think it's even worse. For newcomers it's even harder to find those groups.

It's an general movement, let the customer do the work and he is happy...

[BenLoosli]

I know of at least 2 other forums that are open to all to ask PTC-product related questions.

www,eng-tips.com

www.mcadcentral.com

[TomU]

---

bmüller wrote:

Is there any chance that PTC will NOT increase yearly maintenance cost for perpetual.

---

No.  Maintenance costs for existing perpetual licenses will continue to increase each year, most likely at a rate higher than a corresponding subscription.

[TrainStopper]

The quote I just got for my Creo Essentials support renewal came in about $280 more per seat for subscription than for perpetual. The perpetual price did not go up much from last year. Yes, they are throwing in extra options & extensions with subscription (simulate, surface, additive mfg, piping & cabling) along with eLearning, Extended Borrowing, Design Exploration, Human Factors, and I would have multiple seats of simulate instead of 1. It looks like subscription is cost effective if you have the extras and perpetual is cost effective if you are fairly bare bones. I have not made a decision yet.

[TomU]

In my opinion the major factor is not the price difference, it's future access to your data.  If you switch to subscription now and then decide to stop at some point in the future, you lose all ability to run the software and access your intellectual property.  On the other hand, if you are on maintenance and decide to stop, you can still run the software forever (perpetually), you just lose access to tech support and future updates.  If you never plan to stop your subscription, then it doesn't make any difference.  I'm just not ready (yet) to make that kind of commitment and risk potentially losing access to our intellectual property at some point in the future.  Obviously each company is different.

[DeanLong]

Tom,

If you had to guess...How do you suppose PTC will deal with the reality of most of us? That reality is our clients, usually very large install bases, will probably continue to pay maintnence on their perpetual licenses since they have buying power leverage, and only upgrade every 3rd rev. What happens year two when the old rev is needed but they will shut us off becasue we do not need the latest rev. I assume this subscription deal could also be deemed a "usage priviledge" fee. We will be forced to buy a subscription for access to old code. I have to stop....the more I think about this deal...the more steamed I get.

[346gnu]

Good point Tom,

The payment is for access to your IP.

Perhaps we should call it an annual ransome.

Pay it or your business is dead.

[StephenW]

That is a true statement!

[BenLoosli]

My question and issue with subscriptions is, what if you have multiple customers and they require different versions of Creo files? Customer A wants their files developed on Creo 2, but Customer B wants Creo 4. With subscriptions, do we still get the flexibility to run multiple versions of Creo? Can we run Wildfire 5, if needed still?

[MartinHanak]

Ben,

subscription Creo license = Creo license containing date limit. This means it is valid until date included in its INCREMENT block. This is the only difference from perpetual license whose INCREMENT block contains permanent word.

Subscription license enables you to run Creo 4.0, Creo 3.0 and other previous version.

[bmüller]

how large are companies who pay only every 3rd year? How many seats?

Large with in house Creo Admins or small with "Self-Creo Admins"? At least for Updates we need the Support. We could solve some issues by upgrading to higher Datecodes.

I think our VAR wouldn't like it if we pay one license for software downloads and some questions and the rest only every third year für Major releases.

> This means it is valid until date included in its INCREMENT block.

oh no - extra Admin work 😞

Regarding, end of usage. If a company plans to change their major CAD-Product. they should have some exit stretegy. 

for us at least the saving of Simulate & ISDX maintaince fees makes the subscription model equal priced.

Afaik the subscription Simulate & ISDX licenses are equal to the "old" ones.

br Bernhard

[dschenken]

They don't pay every third year, they only roll out a new version at 3 revision intervals. I suppose service companies have been able to depend on having licensed older versions on perpetual licences to allow working with companies that fall behind in revisions.

[bmüller]

Jnelson wrote:
> perpetual I have the option of saving money each year by skipping maintenance, especially if there is no new release worth switching too

And somone said you only have to pay rhe last 12 months back.

Or are these node locked licenses and not floating?

Br Bernhard

[dgschaefer]

---

@bmüller wrote:

@jnelson wrote:
> perpetual I have the option of saving money each year by skipping maintenance, especially if there is no new release worth switching too

And somone said you only have to pay rhe last 12 months back.

Or are these node locked licenses and not floating?

Br Bernhard

---

My understanding is the policy of only paying 12 months back maintenance is gone.  Now, to renew a perpetual license that is off maintenance you need to pay all back maintenance.  Also, my understanding is that if you are less than 12 months off maintenance there will be an offer to convert to subscription at a reduced rate. Past 12 months, the only option to paying all back maintenance is to buy new subscription seats.

PTC is typically fairly opaque about these policies.  You won't find anything in writing anywhere and they can change at any time.  My understanding is based on conversations with my VAR.

[DeanLong]

I can confirm Doug's post. My company is in the very SPECIAL position of having one, yes ONE client that is on Creo 2. They have been since 2012-ish and they have no current plan to move up the rev ladder. But that could change tomorrow. So, that means Dopey-Boy (that would be me) had ZERO reason to pay maintenence since I PURCHASED Creo 2 back at that point in time. This has always been the scenario most of us suppliers have had to deal with. That is, there is no point, or reason, paying for software that is of NO USE. Anyway, when the time for the money grab was getting short....I was presented with a very hansome quote for almost $17,000 for ONE perpetual Essentials license with ISDX. I.E. paying every bit of back maintenence since 2012 to use the software I already own. ARE YOU FRIGGIN KIDDING ME? My first two licenses of Pro/E in 1996 cost $23,000 each! How times have not changed. And, of course, the second handsome quote I received was the shiny, new 365 day "access fee", e'hem, excuse me, "subscription" price of almost $6000. Sick to my stomach. But to help with the nausea, I bought a competitor's software, for SUBSTANTIALLY less money that does not require a subscription. I and am getting proficient on it so I can support current and future clients without a hand in my pocket next year. I am glad I am close to retirement.

[STEVEG]

I applaud your move to another software!  I wish more of us could switch.

[346gnu]

That makes you one less perpetual license PTC have to support in the long term. Which means a more tenuous, certainly less powerful (titter titter) position for those who must remain.

Somewhere in PTC a bean counter saw what Adobe did with Photoshop 3-4 years ago and presented a pie chart with all that lovely revenue you did not pay and that's why subscription models are better. Therefore Gartner are right probably right and I wonder if they have attempted to analyse the true motivation? I haven't looked. 'shareholder interest' is at the top of my list.

We are old enough to know that the rest is spin and you are aceptable collateral damage.

[mstevens]

I to moved to a competing product. I begged and pleaded with my VAR to let me get my perpetual license back on subscription without having to pay the penalty of all the back maintenance. It was a no go. So then I just decided I would buy a new license and then I had an epiphany. 

It seems if you are not CAT, Deere, Boeing, or the like PTC does not value your business. So I moved to a different, faster and stronger, math package also. As a small business owner, any positive net cash flow is good for me especially if there was no effort on my part to get it; that is essentially what PTC had with me, I never once used support when I was on maintenance. 

Oh well... I am glad to be done with my begging; its really quite unbecoming.

[DeanLong]

mstevens.... I could not have said it any differently nor could as that is exactly the same position I was in last November.

If you get a moment, send me a direct email with your contact info. My info is in this thread above. I would like to know if we went the same direction.

[BenLoosli]

IF we ever need to increase our license count, it will be very expensive! we have 10 licenses that we dropped maintenance on at WF4 and another 8 that we dropped 2 years ago at Creo2. Right now I am giood with the 7 licenses we have active since we only have 6 of us that use Creo and only 3 use it full-time. I do have 3 additional license that are up to Creo4 that I could transfer to the production side, if needed.

I guess if we ramp back up with more designers, then subscriptions may be our cheaper option. Having the perpetual licenses would allow us to open anything done with the subscription, so I would never lose any retrieval capability.

[DeanLong]

Trainstopper,

As an older than dirt (30+ year) PTC software user, I cringe everytime I hear the words PTC is "throwing in options" (I.E. free options into the code). The fact is just about everything that Creo contains today has been in the code either all along or has been in or out to some degree over the past decade. While I cannot say for 100% certainty as I do not have a copy of your license agreement to read, but going on history, I doubt very much you are getting full blown Simulate for free in your license. I say you are getting Simulate Lite, which has been "in" Essentials since at least Creo2. Surface and .stl file creation  (I.E. new buzz term "Additive Manufacturing") have been there since at least 1998. Proper "Cable and piping" went bye-bye around the time RSD became a salable "thing" for PTC. But that functionality is easily accomplished with tools already in the code as of Creo2 and safely prior to that.

Listen, I do not want to sound like some old crotchety geezer....but after 3 decades of being knee deep in BS marketing hype, licensing shell games and "Enhancement" smoke and mirrors by PTC, I am a bit cranky. I have lived through decades of Better, Faster, More Productive, BetterFasterProductivity, BombDiggetyFasterProductivity, Ad Nauseam BettererFastererProductivity. If all that were true, I could model a 787 Dreamliner in about 9 seconds. Total Garbage. Us geezers basically created the software you use today based on our blood, pain and tears.

Please understand this whole subscription deal is 100% about NOTHING BUT MONEY for shareholders. Do not move one inch forward in your design life on Creo thinking you or me or anyone is get anything for free. The mis-direction now, like all dealers whether drugs or software, once you are hooked...the price becomes irrelevant. Meaning, "the first one is free" is alive and well and anyone addicted to Creo by the end of 2018 will see prices rise stupidly high relative to today.

[346gnu]

What am I paying maintenance for then?

Is it just bug fixes?

[BenLoosli]

---

@346gnu wrote:

What am I paying maintenance for then?

Is it just bug fixes?

---

Bottom line, basically yes!

You get new builds during the year which PTC has said should not include new functionality. They have occasionally added functionality to a release but it is usually a by-product of fixing a bug that uses the same code.

You also get access to tech support and the PTC Community.

[TomU]

PTC has released a response.  You can read it here:

http://portal.ptcuser.org/p/bl/et/blogaid=85

[DeanLong]

Read it. I would call that a non-statement. Over the last 30 years with PTC, I have seen numberous similar "statements".

[346gnu]

Hey Eric Snow,

Why doesn't Paul Lenfest get down and dirty with us here rather than the inertial process of PTCUser?

[dschenken]

1500 Customer Success employees? **

The FAQ, that wasn't linked to, may be here: https://www.ptc.com/en/try-and-buy/subscription

I'm ambivalent about the idea of  "Smart connected and proactive support to pinpoint problems sooner, see trends, and operate more efficiently" which sounds like Clippy 2.0

"It looks like you are making a sketch, can I help with that?"

Happy Holidays!

**Another springboard chance.

Every piece of software has what I think of as UI endpoints, places where the user has done their part and they click the OK button and the software makes some change. It seems to me that each one of these is an endpoint to a particular path of actions the user has done and that these endpoints can be uniquely identified and their useage tracked and be used to see just how many endpoints a user actually knows about.

Therefore users having trouble could identify which endpoints they were unable to utilize and be sure the Customer Success employee is already well experienced in handling the problem based on a tabulation of the number of times they have successfully done so.

[TomU]

Looking at the latest financial results, PTC seems to be accomplishing what they intended.  Here are a few quotes:

License and Subscription Bookings

For the full year, CAD bookings grew 14%, far outpacing market growth.  This was the second consecutive year of double-digit, constant currency CAD bookings growth.

Subscription % of Bookings
Q4’17 subscription mix of 72% was above our guidance of 68% and was the highest quarterly mix posted to date.

Software Revenue
Software revenue grew 10% YoY in Q4’17 and 5% YoY for FY’17 as we exited the subscription trough, due to the success of our subscription transition program,

Solutions Software Revenue
Quarterly software revenue growth of 10% in Q4’17 was the first double-digit growth quarter since Q3’14, prior to our move to a subscription model.

Other Highlights

In Q4’17, subscription bookings represented 72% of total bookings, 4 percentage points higher than our guidance of 68% and 2 percentage points higher than our Q4’16 bookings mix of 70%.  For FY’17, subscription bookings represented 69% of total bookings... Programs promoting the benefits of subscription as well as our support conversion program are driving our ongoing success in our transition to a subscription business model.

FY'18 Guidance

A higher mix of subscription bookings is expected to benefit us over the long term, but results in lower revenue and lower earnings in the near term.

For FY’18, we expect 80% of our bookings to be subscription vs. 69% in FY’17, with subscription mix exiting the year at 85% in Q4’18.

Note our FY’18 subscription revenue guidance exceeds our subscription bookings guidance by more than 20% for the first time in our transition, illustrating the compounding benefit of a subscription business model as it matures over time.

[346gnu]

I've been reading Gartner publications discussing flat sales 2016 and increasing proportion of leasing. Documents awash with 'Boston Matrices'.

This is generic trend and not limited to software.

For PTC it's business and its working for them at the moment. Fair enough. Surely we can only conclude that this transient will see a user base 'adjustment' and that's that. Leasing will work for some, others will change. Some may be driven by the investment they have in their databases and training; changing course is not cheap and to be put in the position where they lease or retrain is not fair.

I see the company that offers a mixture of both perpetual and leasing surviving better than one who only leases. There again, PTC's website looks less and less like that of an engineering software company so who knows what their grand plan is. It will be very interesting to analyse the resulting stratification; to understand the type of company and circumstances for whom leasing is best and those that prefer perpetual licenses.

It seems Solidworks (I read as the directly competing product) do not have the same view on leasing; although it is possible to lease I think they are firmly entrenched in the perpetual camp (at the moment !)

PTC have always had the extra separately licensed modules which I gather are now being 'bundled' in various permutations to incentivise prospective lease victims. So it must be reviewed that the following:

• Fatigue (has always been much better than fatigue advisor and still is)
• Advanced Surfacing
• Mechanism dynamics equivalent

Are all in the standard version of Solidworks including contact. Contact being funtionality PTC has scoped out of their 'standard' offering which I have said before is misguided at best. The Solidworks simulation matrix seems more sensibly structured.

The pricing structure is cack-handed. Why on earth would you lease Creo and have it switch off at midnight one year later when for 2 years lease you can have a perpetual license of Solidworks and zero anxiety. The ratios are crackers.

And the incentive structure PTC offer is **bleep**-eyed too.

Bringing up to date the maintenance of our second simulation seat (Currently at Creo3.0) makes a move to Solidworks very very cheap indeed. Then when we factor in attendant uncertainties regarding future treatment of perpetual license owners by PTC the decision becomes really easy.

I have had many discussions this week. Twice I was told (no prompting) that it was wrong that a company should have to pay to access/use/update its IP after midnight LEASE = RANSOME. The second red flag was the potential to run out of license on a project with limited margin is a massive no-no.

Thus we will keep one seat of Parametric and Simulation maintained and leave the other sad sorry wasted investment to slowly wither. We won't renew the surfacing extension either as when compared to the cost of a solidworks seat it would be a stupid idea. We will continue to use Ansys and FE-Safe in the background.

At the end of the day our customers use both Creo and Solidworks. For us, CAD is a fancy geometry preprocessor and provided we get the right answer the analysis package is broadly irrelevant unless someone is particularly precious about which we use (remember, there is no bad software. Only bad users). Of course, if you want to study finite friction or large deformation with contact then the former does not work and the latter is extremely painful in Creo Simulate if you have yielding materials.

Oh yes, Solidworks have submodelling too ... and before anyone tells me to submit product ideas, I have. I cannot be bothered anymore. The level of feedback I received is exactly zero which exactly matches the feedback I got to my questions regarding leasing.