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  • Enterprise IT, News - Written by on Monday, February 18, 2013 17:35 - 36 Comments

    Adobe faces piracy backlash over Australian pricing

    adobe

    news Many Adobe customers have taken to the Internet to openly pledge to dump the software vendor’s products or pirate them illegally, with thousands more signalling their general displeasure with what many saw as the arrogant refusal of its chief executive Shantanu Narayenlast week to answer the question of how the company can justify charging Australians up to $1,400 more for its software than US residents.

    In Australia last week to attend the official opening of Adobe’s new local offices in Sydney’s central business district, Narayen took questions from the media about his company’s local pricing strategy. Adobe has long marked up its products for the Australian market. For example, in April 2012, it revealed that locals would pay up to $1,400 more for the exact same software when they buy the new version 6 of its Creative Suite platform compared to residents of the United States, meaning some Australian residents can afford to fly to the US to buy a US version of the software and fly back, for the same price they would pay in Australia for the software.

    However, Narayen flatly refused to answer direct questions on the issue, instead repeatedly emphasising that the company saw the future of its products as being its leased version of Creative Suite, termed Creative Cloud, rather than the traditional Creative Suite software which still makes up the vast majority of its revenues. A video of the executive dodging the pricing question has so far attracted some 243,000 views on YouTube.

    Comments from Adobe customers and other IT professionals on Delimiter, as well as YouTube and global technology media outlets Engadget and The Verge, almost universally condemned Narayen’s stance.

    “I’m done with Adobe,” wrote one commenter on Engadget. “As a professional photographer, I’ve found more than a few alternatives to using Photoshop that will do all and more without this nonsense (at a fraction of the prices Adobe thinks are reasonable). I’m not Australian, but this behavior leaves a really bad taste in my mouth and encourages me to move on.” Another added: “The Pirate Bay seems to be charging the same amount for the Adobe suite regardless of region, not sure why Adobe can’t do that.”

    Many comments on The Verge reflected similar sentiments. “I always try to license my software. I didn’t as a kid, still learning things, but I did once I started doing business with it. I know all the hard work that goes into developing software,” wrote one commenter. “But I don’t with CS6. Why? I live outside the U.S. and I feel I’m being taken for a ride … I’m looking for alternatives all the time.”

    Another commenter wrote: “We’ve been paying a lot more for most things for a long long time. I don’t actually know anyone who has bought the Creative Suite outright here in Australia. I use a student edition … most people just pirate it here though. Actually let me re-phrase that – “every one pirates it here.”” And another commenter added: “There is a simple solution to the pricing: The Pirate Bay.”

    The YouTube video received a large amount of comments in response to Narayen’s refusal to directly address the question of Australian pricing. 937 people commented directly on the video, and 1,568 viewers ‘liked’ the video, with only 106 viewers disliking it (Note: Delimiter has disabled comments on the YouTube video as a number of offensive comments were posted that were unable to be moderated due to bugs in YouTube’s moderation system. However, the comments are still accessible via Delimiter’s admin console). In general, the YouTube comments were a little less polite towards Adobe than the comments on the technology media outlets.

    “I hate piracy and I have a legitimate copy of [Creative Suite 5.5], wrote one respondent, “but even I think its OK for people to pirate Adobe software because they have a monopoly and they are taking the utter piss! Piracy is theft but what Adobe is doing is extortion and morally just as bad, if not worse. Maybe you should think about dropping your prices (by a lot) Adobe because you are clearly losing respect and eventually everyone will pirate your software because they cant justify your thieving prices!”

    Another added: “As an American I would like to say this is bullshit and I can only imagine if it were the other way around. I would suggest you pirate the entire Adobe family of software and then send them a beautiful Photoshopped middle finger.”

    The news comes as the Federal Parliamentary committee examining price hiking behaviour from IT vendors in Australia last week revealed it would compulsorily summon Adobe, as well as fellow vendors Apple and Microsoft, to give testimony regarding their Australian pricing schemes. The trio have in the past refused to take questions from the committee in public hearings, although Apple had consented to take questions from the committee in private.

    Adobe last week harmonised some of its local pricing on its Creative Cloud monthly subscription product. However, the company still maintains its substantial markups on its traditional lines of software — Photoshop, Illustrator and so on — that are contained in its Creative Suite bundle.

    Speaking to ZDNet in a video interview this week, Labor MP Ed Husic — the driving force behind the parliamentary committee looking into the price hikes — welcomed the drop, but added it wasn’t enough. “Full marks to them, but this is only the initial step. As consumers are rightly pointing out, [the price drop] is not for the stand-alone products; this is restricted to the cloud at the moment,” Husic said.

    opinion/analysis
    Wow … that video of Adobe certainly created a sizable impact on the Adobe universe. The company’s chief executive Shantanu Narayen might not have anticipated that his refusal to answer questions on Adobe’s Australian pricing would be watched by (at last count) some 243,000 technology enthusiasts and IT professionals worldwide. Additionally, it looks as though this isn’t just an issue which affects Australia — with residents from quite a lot of countries outside the US echoing Australian complaints about Narayen’s response to the issue.

    Personally, I just want to say that I don’t approve of pirating software. Software, after all, is just intellectual property, and I personally am a writer who makes his living by creating my own intellectual property — articles on Delimiter — and selling advertising around that IP. If everyone started pirating Delimiter articles, our audience would be diminished and I might find it hard to make a living. Copyright laws do continue to make a certain amount of sense in our modern age (although they do need an overhaul in many countries), and I wouldn’t encourage anyone to break the law to protest Adobe’s pricing.

    However, there’s nothing illegitimate about seeking alternative options. That’s just competition in a capitalist market. While it’s not possible for everyone to replace their copy of Photoshop with something else, for many people it is quite possible, and cheaper alternatives such as Pixelmator (normally $59.99) and GIMP (open source and free) are out there and being widely used.

    What surprised me in general about the thousands of comments posted in response to this video was the sheer animosity which many people displayed towards Adobe. It felt to me as though it wasn’t just the Australian pricing issue which people are frustrated with the company about; there’s a whole range of issues, from the technical faults of Adobe Flash to the way that Adobe deals with customers, that people were raising.

    If I were Narayen right now, I’d be listening clearly to those voices. It’s common for companies like Adobe to monitor social media to get insights into their customer base and try and address their needs. Well, based on events over the past few days, there’s a lot of insights out there for Adobe to pay attention to. In the hands of a responsive company, these insights can help transform its operations along more positive lines. It’s common for executives these days to talk about how they want to “delight” their customers with their products and services. I know that Adobe has been able to do this in the past, and given the quality of its products and the deep history it has in the technology industry, I’m confident the company could eventually turn that negative sentiment around if it wanted to. Hopefully the feedback being sent Adobe’s way right now will help the company see opportunities to take that approach again in the future.

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    36 Comments

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    1. Daniel
      Posted 18/02/2013 at 5:42 pm | Permalink |

      Why I am not surprised, the chief executive, Shantanu Narayen, needs to be sacked.

      If you are not answering to your customers, you may as well not answer to your shareholders.

      • Tinman_au
        Posted 19/02/2013 at 2:25 pm | Permalink |

        There is an answer…..it’s in the “Creative Cloud” somewhere I heard!

    2. Aldus Manutius
      Posted 18/02/2013 at 6:04 pm | Permalink |

      Once upon a time there was a company named Quark who got arrogant, didn’t listen to its customers and was overtaken by Adobe. Now, Adobe seems intent on repeating the Quark dilemma while Quark, under smart new ownership, looks set to bounce back – particularly in the Cloud.
      Deja Vu?

      • Jfish
        Posted 19/02/2013 at 6:04 pm | Permalink |

        I was thinking that exact same thing when this story initially emerged.

        This is exactly how Adobe ended up overrunning Quark. Quark was over priced and under serviced in this country by a lot and most people changed to Adobe’s Creative Suite because to do so made financial sense, even if the software was still going through major teething issues (if you had a Photoshop license, and most people did, the price to change over for the whole CS was about $500). It didn’t matter that Quark’s soft where may (or may not) have been superior…people were over their attitude and their pricing.

        It really is like deja vu…

    3. Thomas
      Posted 18/02/2013 at 6:14 pm | Permalink |

      Good work Renai, can you do Steve Ballmer next?

    4. Duke
      Posted 18/02/2013 at 6:35 pm | Permalink |

      Well some say alternatively accessing a service from a carpetbagging, dictatorial, gouging, virtual monopolist who is amassing exorbitant riches (and plush offices) on the back of abusing their own customers is far from piracy… it is, in fact, a social-political-commercial act of responsibility.

      … or simply put, “screw me, screw you, you overpaid conman”…

    5. Malcolm
      Posted 18/02/2013 at 6:38 pm | Permalink |

      Software pricing has been ridiculous for so many years, example.
      A 500 user licence for schools is approximately $13000 for the full creative suite. The schools don’t have the funding to really provide this software to its students, and with different laptop program’s they cannot provide the software at all.

      Now if the full creative suite was $25 per student, and $50 per individual and $150 per commercial single licence, you would recoup your losses from those who pirated it.

      Use the apple App Store mentality, provide a product that everyone wants and then make it very affordable to purchase.

      They will also pay to upgrade the software later on.

    6. Andrew
      Posted 18/02/2013 at 8:24 pm | Permalink |

      I’d just like to throw Paint.NET into the list of free alternatives. I’m one of these people who can’t justify purchasing Adobe software and I am forced to resort to desperate measures if I want to use it, but I’m finding these days Paint.NET suits most of my basic needs (cropping, resizing, etc). It’s super easy to use too!

      • LetsBeOpenAboutThis
        Posted 19/02/2013 at 3:04 pm | Permalink |

        Oh and let’s not forget “Gimp”, It is available for Win, Mac and Linux!

        • djos
          Posted 19/02/2013 at 3:17 pm | Permalink |

          last time i tried gimp it was uninstalled within minutes due to being an amateurish, user hostile POS!

    7. Phil
      Posted 18/02/2013 at 8:55 pm | Permalink |

      I agree wholeheartedly about looking for substitutes for Adobe apps. For many of Adobe’s products there are alternatives that work very well. Photoline is one, I still laugh at how quickly this 2 person company turned out a 64 bit version of their very capable image editing app compared to Adobe’s efforts with Photoshop, and all for 59 euro. If you are not locked into a workflow that requires Adobe apps, then there are a plethora of alternatives out there that don’t work like they were designed by a committee.

    8. Paul Thompson
      Posted 18/02/2013 at 8:55 pm | Permalink |

      Don’t forget the ‘free’ release of CS2. I imagine that it will be hit up pretty hard as well, even though the page says that the provided serials are only for people who legitimately bought the software.

      http://www.adobe.com/downloads/cs2_downloads/index.html

    9. Posted 18/02/2013 at 9:46 pm | Permalink |

      The same stance in taken by Microsoft and National Instruments,etc

      What’s odd it NI ship their hardware from Eastern Europe or Asia direct, and in many cases its cheaper to ship to Australia than the USA. Yet H/W and S/W costs often 40% more in Australia!!!! Why?

      Online download products should be sold one rate!

      Companies like DevExpress, have an even playing field.

      Don’t give us a break, give us a fair go!

      Protectionism++ – where’s the “free” in a free trade agreement?

    10. Sam
      Posted 18/02/2013 at 9:58 pm | Permalink |

      I personally don’t feel bad about pirating adobe – they try to rip me off, as a student I am required to use their product yet they are being unreasonable about their prices – So I just do what I have to do

      • Trev
        Posted 19/02/2013 at 1:37 am | Permalink |

        You’re disgusting Sam. How is Narayen’s butler able to put fuel in Narayen’s Ferrari when you’re ripping him off so?

        I actually heard .. true story .. that when Narayen has to fill his Ferrari up himself he squirts it through an Australian flag to 1. Remove any impurities and 2. He thinks less of it than his snot rag.

      • NPSF3000
        Posted 19/02/2013 at 1:59 am | Permalink |

        “I personally don’t feel bad about pirating adobe – they try to rip me off, as a student I am required to use their product yet they are being unreasonable about their prices – So I just do what I have to do”

        Yes, $15/month is *sooo* unreasonable.

        • Adam (the other one)
          Posted 19/02/2013 at 9:09 am | Permalink |

          Thanks for that, Shantanu.

          I’ve used Gimp for years, and will continue to do so, purely because of Adobe’s segregated pricing. I don’t care how aligned the Creative Cloud thing is (suddenly), the company has been ripping us off for a very long time, using geoblocks to ensure that the ripping off is not breached, and it’s simply not acceptable.

          • NPSF3000
            Posted 19/02/2013 at 10:26 am | Permalink |

            “Thanks for that, Shantanu.”

            Good to know that anyone that thinks outside the box for a second is personally attacked and vilified.

            “I’ve used Gimp for years, and will continue to do so, purely because of Adobe’s segregated pricing. I don’t care how aligned the Creative Cloud thing is (suddenly), the company has been ripping us off for a very long time, using geoblocks to ensure that the ripping off is not breached, and it’s simply not acceptable.”

            Heck, I changed entire *platforms* instead of using adobe [as I was trained] I decided to go with Unity3D and the .NET/Mono platform. But hey, why bother having a calm discussion?

            • Adam (the other one)
              Posted 19/02/2013 at 4:41 pm | Permalink |

              You’re the one throwing out straw men to defend Adobe. The issue is very clearly about Adobe price-gouging Australians with nearly all its professional products, not how cheap Creative Suite is. Defending rip-off merchants is not ‘thinking outside the box’, by the way.

            • Adam (the other one)
              Posted 19/02/2013 at 4:43 pm | Permalink |

              Creative Cloud, I mean.

        • midspace
          Posted 19/02/2013 at 9:15 am | Permalink |

          “$15/month is *sooo* unreasonable.”

          Not all of us had parents who could afford the necessities for all of school life.

          When a piece of software is listed as the requirement for a course/subject, then you cannot use anything but that specific software. There is no way around it.

          • NPSF3000
            Posted 19/02/2013 at 10:22 am | Permalink |

            “Not all of us had parents who could afford the necessities for all of school life.”

            50c/day shouldn’t *force* one into piracy.

            “When a piece of software is listed as the requirement for a course/subject, then you cannot use anything but that specific software. There is no way around it.”

            Then that’s a problem that the course needs to address – again it’s not a valid rationale for piracy.

            • Paul Thompson
              Posted 19/02/2013 at 1:44 pm | Permalink |

              Once you come down to rationale for any action, it starts to become very subjective. In terms of pure ethical reasoning, you won’t find any absolute answers. You can refer to the legal interpretation, but the law isn’t a guaranteed arbiter of all that is ethical.

              For some people, Adobe’s actions are sufficient to justify pirating their product.

              So when you say that it is not a valid rationale, what do you base this on?

    11. Sean
      Posted 19/02/2013 at 10:07 am | Permalink |

      And people wonder why Australians pirate software. Narayen’s ignoring of the topic is farcical. He is a fool if he thought journos would not be asking about the price disparity of Adobe software. Maybe it is time to stop pandering to resellers in Australia which seems to be the main reason Adobe keeps pricing at skyhigh levels.

      Internet savvy users want to buy software direct and not through some half-baked Australian reseller who has no concept of after sales service.

    12. Stephen H
      Posted 19/02/2013 at 10:21 am | Permalink |

      Piracy isn’t the answer, finding another product is. Adobe has been failing on a few fronts lately – security in some of their most used software is totally inadequate, and they are not fixing the faults fast enough. There are quite a few people uninstalling their Adobe products (I got rid of Reader this morning before even reading this article – it has its own security flaws), and I would expect the company to need a new CEO before long.

      Seriously, 243,000 viewers? You’re famous, Renai. (253,000 now).

    13. GongGav
      Posted 19/02/2013 at 10:21 am | Permalink |

      I’m seeing the backlash as a frustration issue. For the past couple of months we’ve repeatedly seen stories about how Apple pays 1% tax, Google pays 1% tax, Microsoft jacks the prices up with an Aussie Tax, etc etc etc.

      Finally, people have a face to point to, and a video to watch, personalising all the frustration thats been building up with these companies.

      I’ll be in the states mid year, and will be doing a comparison of IT products across a range of items. We dont get the blunt end of the stick every time (my 50″ plasma was cheaper here than most of the US for example), but when we do, we get hit hard.

    14. Stephen H
      Posted 19/02/2013 at 10:33 am | Permalink |

      Slight tangent…

      The unfortunate fact is that Mr Narayen did what the average politician does in an interview – refusing to answer questions, while focussing on “our achievements” and/or “their failings”. His problem in this instance was that the (intrepid) reporter pointed that out to him – something our media generally fails to do. In failing to hold interviewees to account, and failing to ensure they answer questions, the mainstream media is failing all of us.

      The media is supposed to be the fourth estate, protecting our rights by fearlessly holding those in power to account for their actions. By wanting to be a part of the action (Murdoch, Packer), the media not only fails in its duty but actively undermines its own standing. This is why some of us turn to independent players such as Delimiter and Crikey – the average person has lost their voice.

      Of course, those in power have actively encouraged this change. By refusing to deal with interviewers who will not accept their spin (George W barred people from the White House Briefing Room, the Coalition threatens not to talk to ABC journalists fairly regularly), those in power manipulate the media to their own ends. But it could not happen without media organisations acquiescence – if a press member is “barred”, then stop talking to and interviewing the person who issued the bar. They will change their minds.

      The state of the mainstream media in this and other countries is deeply depressing. What is more depressing is that most people rely on the nightly news, or the tabloid with those great page 3 girls, as their source for what is happening in the world.

    15. djos
      Posted 19/02/2013 at 10:39 am | Permalink |

      @Renai Pixelmator is on Sale for $15.99aud right now and I just grabbed a copy for my i7 Mac Mini!

      It’s really nice software, thanks for letting us know about it! :-)

    16. Greg
      Posted 19/02/2013 at 11:57 am | Permalink |

      That GIMP looks interesting. Thanks for the reference

    17. Brendan
      Posted 19/02/2013 at 1:25 pm | Permalink |

      Adobe don’t give a crap. They know they have a captive market, they’re also well aware of the disparate pricing. Adobe make money regardless of whether they sell their software, or someone else does on their behalf.

      Realistically, anyone using the software for commercial purposes is highly unlikely to pirate it because of the risks associated; so you have a captive market, who will pay whatever it takes to keep their investment going in the product line.

      That’s not really going to motivate Adobe to shake anything up, pricing or otherwise.

      The only thing that might shift prices here, is to find the actual culprit for local pricing; it’s assumed the local guys are making a killing. I tend to think there’s a bit more going on than just one hand in the jar.

      • Tinman_au
        Posted 19/02/2013 at 2:31 pm | Permalink |

        “The only thing that might shift prices here, is to find the actual culprit for local pricing; it’s assumed the local guys are making a killing. I tend to think there’s a bit more going on than just one hand in the jar.”

        I’d agree with that if I hadn’t seen how evasive the CEO actually was.

        “Our suppliers have to add their cut on physical products, so Creative Cloud is an option to avoid that” would have been a perfectly satisfactory answer as well IMHO.

        • Paul Thompson
          Posted 19/02/2013 at 4:04 pm | Permalink |

          Yep.

          There were a lot of answers that the CEO could have come out with that, while not making everyone happy, at least would have been kind of understandable.

          His blank refusal to address the question though, means that the answer was in no way acceptable.

          This is an Adobe decision to screw over Australians.

    18. Duke
      Posted 20/02/2013 at 2:51 am | Permalink |

      Thanks for that clarification Narayen! ;)

    19. Will
      Posted 23/02/2013 at 10:50 pm | Permalink |

      The creative cloud option is bunk, when you don’t want to subscribe anymore you have no software to open the files that you have created, so what good is having access to files. I still have cs3 and can still use it years later.

    20. Robert
      Posted 14/05/2013 at 10:38 am | Permalink |

      We have 8 legit copies of cs2 and need to upgrade to 8 new licences.
      The cost is stupid.@!!@@!

      Has anything happened with this Australian problem.

      Appreciate any help




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