Archicad

Graphisoft pivots to subscription

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Graphisoft, Nemetschek’s leading BIM company and developer of Archicad, has announced that it will gradually phase out perpetual licences in favour of subscription

Adobe led the way with Creative Suite transitioning to monthly Creative Cloud, closely followed by Autodesk, which perfected the subscription model in the AEC space, driving increases in revenue and new licensing options. Pretty much every publicly listed software firm in BIM has now shifted from perpetual to subscription, irrespective of customer sentiment.

Graphisoft describes the move, as ‘part of its strategic shift to a sustainable subscription software delivery model’. New purchases of Archicad perpetual licences will be gradually phased out by the end of 2025 but will not affect the delivery of Software Service Agreement (SSA)/Forward customers – Graphisoft’s first subscription service, which provides with access to exclusive tools (network licensing, Twinmotion), training, support, and extra services such as licence key insurance. Archicad perpetual and SSA/Forward licences will still be available for new customers through December 31, 2024, and to existing customers through December 31, 2025.

New subscription licences are branded ‘Archicad Collaborate’, as they come bundled with software and services BIMx Pro, BIMCloud, and Redshift Renderer.

If SSA/Forward subscription customers wish they can immediately convert to the new Archicad Collaborate subscriptions for the same price as SSA/Forward. This offer is designed to help existing SSA/Forward subscribers take full advantage of the Archicad Collaborate subscription, which increases access to Graphisoft’s collaboration tools.

A cloud-based subscription extends the inherent desktop perpetual version of Archicad, which has local saves, maintenance subscription and gets a yearly updates to a model which provides cloud-based back-up, file history, collaboration, continuous updates and flexible cloud licences. In fact we see the flexible licensing as the jewel in Graphisoft’s subscription transition. Graphisoft’s subscription products run using modern cloud technology, so licences can be assigned to individuals as “named licences” and can also be assigned to a group of users as a “network licence” pool where users can get a licence on a first-come-first-served basis. Users can also go offline with cloud licences for up to 7 days. Floating licence support will come in Q3, 2024 and will be made available to all Archicad Collaborate subscription customers retrospectively.

Graphisoft recently hot-swapped CEOs, from Huw Roberts to Daniel Csillag. This move to transition from perpetual to subscription comes as Csillag’s first major business impact.  “Technology in the AEC industry is evolving at lightning speed,” commented Csillag. “Shifting our product delivery model to subscription allows users to take advantage of agile, responsive, and up-to-date software solutions — as soon as they hit the market,” he explained.

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Archicad Collaborate is available at its standard price to new customers in the online Graphisoft Store. SSA/Forward customers can take advantage of Graphisoft’s unique conversion offer at the time of their SSA/Forward term renewal, starting in April in select markets (US, Canada, and the UK), with other markets joining during the course of 2024.

Monitoring the Graphisoft support forum, the reaction has been as expected, with the majority of long-term perpetual customers expressing their angst. Archicad perpetual licences can be used indefinitely and deals for conversion are available for 3 to 6 years.

For SSA/Forward customers, who are already on a form of subscription, the issues are not so much on the business model but the year-on-year cost increases which SSA/Forward seats have endured and the nuances in differences between the new subscription offering.

Graphisoft guarantees price parity with SSA/Forward for the initial subscription term and same discount percentage at the first renewal for 3-year upfront paid subscriptions. Yearly payment options are also available for a 10% markup on the 3-year upfront paid option. SSA/Forward licence pools maybe converted only “all or nothing” at this point. There appears to be a fall back position to return to perpetual as a fallback option, as well as access to Archicad V13.

Transitioning multiple business models to subscription was always going to be a bit messy and will take many years for the base to get used to. It’s pretty much always the case that subscription bundles offer more in terms of features and services but in our experience it inevitably comes with an increase in the cost of ownership. I’ve yet to see any software firm successfully weigh-up, portion and stream in-subscription contract features, especially in a collaborative profession that has major issues of being, not only on the on the same version but also the same build of an application.  At the end of the day, it boils down to value- value delivered – and that can only be perceived by the customer. If business models and shareholder dividends become more obvious to customers than innovation and productivity delivery, coming back yearly to demand the next year’s subscription becomes a new point of customer friction.

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