Does Cheap Software Make Good Business?
In an earlier post I mentioned that IntelliCAD was now available at a price of $50 from Rolek Ltd, a reseller of DP Tech, a French IntelliCAD vendor. I ended by saying that a licensed copy of IntelliCAD was now cheaper than a cracked copy of AutoCAD.
A reseller of another IntelliCAD vendor took it a step further. They went ahead and lodged a complaint with Rolek's web host stating that Rolek's was selling pirated software and that the IntelliCAD Technology Consortium was in the process of initiating legal action against Rolek. Apparently, the web host bought the story and took Rolek's web site down. Rolek claims that the ITC intervened and sorted things out with the host to get it's web site back online again. The gory details can be found in the comments of this post on the IntelliCAD.net blog.
Personally, I am not too happy with the direction which IntelliCAD's price is headed. Cheap CAD software may be a good thing for end users, but it makes third party developers like me lose interest in developing plug-ins for them. Our IntelliCAD plug-ins are priced at 95 Euros ($140) and that is already way lower than our plug-ins for other CAD systems. Convincing a prospective customer to buy a plug-in that costs three times his CAD system is not an easy task, unless the plug-in is going to save his job or his life.
IntelliCAD vendors can probably still make money by selling cheap but by selling more. The problem is that the market for plug-ins is quite limited and third party developers cannot drastically cut prices and hope to increase sales to make up for lost revenue. To make it worse, there are so many flavors and versions of IntelliCAD out there, with each vendor adding bells and whistles and in the bargain preventing standard IntelliCAD plug-in DLLs from loading. As a result we need to build different versions of plug-ins for different flavors of the same version of IntelliCAD. Yes, its that bad. DWGeditor and ZWCAD are two such examples which need plug-ins to be compiled using special libraries. At SYCODE, we have stopped tweaking our plug-ins to make them work with all the variants of IntelliCAD. We are now waiting for IntelliCAD 7 to be released and eventually rebuild all our old style SDS plug-ins using the new DRX SDK, and then hope that the IntelliCAD vendors do not go ahead and mess things once again.
Developing and maintaining IntelliCAD plug-ins is a hell of a job and takes too much time and resources. And the dropping price of IntelliCAD is making it less worth taking all that trouble.
posted by Deelip Menezes at
10:39 PM
8 Comments:
Deelip, I think the problem with apps like IntelliCAD is that they have a defined market - essentially 2D drafting. There is always going to be the need for this but the 3D vendors are in the business of pushing 3D and as such offer applications designed for 2D for free - SolidEdge, Think3, even SolidWorks gives away DWG Editor to Autocad users. It could be argued as well that the 2D editing tools in 3D CAD systems are included "for free" given that the bulk of the work goes into the 3D development side.
I'm not a great fan of free software, or even open source software, but I am a big fan of fairly priced software.
In the old days pre internet there may have been valid reasons for localised pricing but in these days of internet delivery, out sourcing development, and more savvy end users who, frankly, just want to buy the software, there can be no justification for the huge discrepancies in pricing in different areas.
It kind of makes me annoyed that software vendors push so much to promote the use of their tools to manufacturing companies, when in fact a manufacturing business CAN sell on a global basis with small variations in price (aside from localised governmental interventions of course). Even the big brands sell on a more or less global pricing basis in RRP terms.
If even the smallest manufacturing company can do this why not the biggest software companies?
How many compannies would leave 2D behind and move to a 3D system if it were available at USA prices I wonder?
By
Anonymous, At
4:03 PM, September 24, 2008
Microsoft is able to sell its Office software at a wide variety of prices, even in North America. For example, students and faculty can buy the $1000+ version of Office Ultimate for around $60.
Perhaps the difference is that the number of units sold. When a third-party developer has a tiny slice of the huge Office market, it's profitable.
Another aspect to consider is that numerous corporations use IntelliCAD internally, writing their own add-ons and customizations.
By
Anonymous, At
1:54 AM, September 25, 2008
Ralph has a good point, cheaper software means the using company can afford more on in house development instead of paying huge somes for a package that's a 'one size fit's all' but rarely does!
If you're add-ons are time saving, easy to use and can pay for themselves in one or two projects, perhaps even more then people will pay. Particularly when they haven't wasted most of their budget on the 'host' application that's really pretty 'dumb' out of the box.
What I'm trying to say is I think you're chances of raising your prices are better when the host is cheaper, or at least you have a better chance of your product being purchased.
There's also the 'perceived' value and which by selling Intellicad too cheaply devalues it's worth, it's a fine line...
By
Anonymous, At
2:30 PM, September 25, 2008
Ralph: "students and faculty can buy the $1000+ version of Office Ultimate for around $60."
Unfortunately, these students and faculty do not end up purchasing plug-ins. Just the other day, we got a request from a student to license him a 195 EUR plug-in for $10.
By
Deelip Menezes, At
8:01 PM, September 25, 2008
The issue of fair pricing and huge discrepancies are issues that I have to confront all the time. I deal with TurboCAD and ‘hand on heart’ think that it’s the best reasonably priced CAD software around. I often come across far inferior well known packages that are much more expensive. I presume that the higher price is simply trying to make the product look better than it is. As TurboCAD deals with so many file formats and has a growing stable of plug-ins I think that there is nothing out there that comes near it in functionality or price
By
Anonymous, At
5:15 PM, September 26, 2008
After running this 1-day trial, I was given the choice of purchasing IntelliCAD Pro. It launched this web page: https://license.ntitles.net/purchase.asp?dlic=X3EPQSAFFPGJDQEXS3FV
Notice there is very little information provided. And you have no idea to whom you are actually sending your payment. I checked www.dp-cad.com, but don't read French, so I have no idea if this is truly legitimate. Has there been any follow-up or new information on this? Thank you. Rich P.
By
Anonymous, At
2:46 AM, September 27, 2008
http://www.intellicad.net/profiles/blog/show?id=2285825%3ABlogPost%3A162
Read the comment ending with "In the name of progeSOFT and progeSOFT's partners I apologize to Rolek and DPTech for this misunderstanding"
By
Deelip Menezes, At
3:22 PM, September 27, 2008
Nice post Deelip, but maybe not 100% accurate. If you read closely the final comment left by "Damiano", it implies that much more than "one IntelliCAD reseller" was part of any original complaint lodged. Things get confusing sometimes even within the ITC itself. Might be worth mentioning.
By
Anonymous, At
10:22 PM, September 27, 2008
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