Wanted: The World's Software Library, by Subscription

Retail software prices are often eyebrow-raisingly high, and for the most part, inflexible. Every couple years, it's not uncommon for our family to shell out $150 to $500 for the latest Microsoft Office Suite. The full Adobe Creative Suite will set you back almost $2,000, and upgrades are $600. The home edition of Mathematica is about $300. Apple Final Cut Studio will cost you $1,000 and Logic Studio another $500. These prices are no doubt in line with professionals who require the software to live, but for more casual users, who might interact with the software infrequently, paying full retail price seems exorbitant. This sets up a market imbalance, similar to that of the world of music pre-Napster, where the consumer at times can seem justified for obtaining the software freely using another method.

I've previously stated that the vast majority of consumers are solid law-abiding citizens who are happy to pay for quality, assuming price is in line with the assumed value of the goods. When inequality enters the system, be it for full music albums, individual movie theater tickets, software, or even pay per view TV events, technology often comes into play to circumvent the traditional restraints.

Adobe CS Sticker Shock

The disruption of the music industry by Napster's steal what you can model, followed by iTunes' efforts to reign things back again at an affordable price point, has recently evolved further with the subscription-based all you can eat method, one not pioneered by Spotify, but popularized by it, despite years of Rhapsody and Napster (part two), and newer competitors like Rdio offering similar structures. Software, running in parallel, can similarly be downloaded for free on peer to peer networks, and can even be downloaded directly with options like the Mac App Store and Google's Chrome Web Store, but missing is the solution for the casual buyer who just wants to rent the software, occasionally accessing it, without needing to shell out for the boxed retail option, dedicating gigabytes of hard drive space for the privilege, being sure to keep one's serial numbers stored under lock and key.

A new business model, following the Music as a Subscription service, emerges with Software as a Subscription, more commonly referred to as SAAS (Software as a Service). SAAS applications can be enterprise-focused like Salesforce.com, or consumer focused, like Google Docs and Gmail, most of whom see all the activity taking place on the Web via a Web service. But what about the more traditional software titles from Adobe, Microsoft and others? What about an iTunes-like, Spotify-like service where the consumer could pay about $25 to $50 a month and tap into all the popular software titles in the world, reading and writing remotely, but saving locally?

One assumes the major reason this generic software subscription model has not emerged is because the traditional retail software giants can still get buyers at the hundreds of dollars apiece, and they would be less interested in spreading a customer's $500 to $600 across 12 months with other providers. So long as they are raking in the revenue, disrupting their own business isn't appealing.

For consumers with high-speed Web access and relatively powerful CPUs and GPUs, the infrastructure for creating such a software subscription service is there. Toss a few thousand titles on Amazon or iTunes and you can see that with smart cataloging, the ability to use any title in the world would be at your fingertips. Then too would come the next stage of the rollout - including video games and premium offerings with tiered pricings and tiered privileges.

Despite the music industry and other's concerns, Spotify's success is not in the ability for some folks to gain free access with ads, but in the popular and accelerating option for paid accounts, eager to shell out real cash for access to an immense music library. I may scoff at the idea of upgrading my Adobe Creative Suite again for a few hundred bucks, only using it sporadically, but I'd pay a good amount per month, like I do for cable TV, electricity and other plumbing, to gain access to the world's software library. Web-based SAAS for single instance applications is not enough. It's early days. A company that can get all the copyright holders to work together and find a solution to customers would be extremely compelling.

Thoughts On AT&T (What Steve Jobs Should Have Written)

Inspired by: Thoughts on Flash

Apple has a long relationship with AT&T. In fact, we share 1984 as a rebirth of sorts for both companies - us with the introduction of the Macintosh, and them with their government-forced breakup into eight companies, thanks to intervention by the U.S. Department of Justice. By 1986, we saw AT&T rise to the #3 position in computer sales, while we held the #2 spot, behind IBM. In the early 1990s, we asked AT&T to design Hobbit, a high-speed low-power chip for our Newton project. While we later chose ARM for the Newton, we respected AT&T's efforts. I could keep going, but just trust me when I say the two companies have long worked closely together to pioneer the world of telecommunications and computing and there have been many good times. More recently, in 2007, Apple chose Cingular as our exclusive provider of cellular phone service for the iPhone. We chose Cingular because it was the best, and the most popular. After this time, Cingular purchased AT&T Wireless, and became the new AT&T. Our old friend, back again. Today, the two companies - Apple and AT&T - still work together to serve customers cellular phone service and 3G mobile Internet access - but beyond that there are few joint interests.

I wanted to jot down some of our thoughts on AT&T's wireless service so that customers and critics may better understand why we should soon be moving away from exclusivity with AT&T on our iPhones and iPads in the United States. AT&T has characterized our relationship as strong, and heavily leans on revenue they have received from Apple iPhone customers to show the company's strength - but in reality, this relationship is falling apart based on technology issues. AT&T claims that they have the strongest 3G wireless offering in the country, and that almost all Americans have access to their network, but in fact the opposite is true. Let me explain.

First, there's "The Best 3G Experience"

AT&T says they have the "best" 3G experience. This is true, assuming you live in one of the few places in the United States that has access to 3G. The reason it is the best? Because they have access to the iPhone and the iPad. It's not the network that makes the 3G experience so good. It's our applications and our hardware. While AT&T says their 3G network is widely available, that does not mean you can get access to it - even in major metropolitan areas, such as San Francisco and New York. By almost any definition, AT&T's "best" is a level of mediocre so horrid we would never allow it to have an Apple brand associated with it.

Apple has many products we also call the "best". Our laptops are the best in the world. Mac OS X is the best operating system in the world. Our digital devices are best in class. They are practically works of art that belong in a museum, and you would leave your significant other to have one. Apple defines what is best because we are the best. We have set the standard in every market.

Second, there's "The Nation's Fastest 3G Network"

AT&T has repeatedly said their network offers the fastest 3G experience - and their commercials highlight benchmarks that show quicker download speeds than Verizon. What they don't say is that this only happens in 3 out of the top 100 metropolitan areas in the country, and when you are actually sitting within 40 feet of an AT&T access point, provided nobody else is using the network at the same time you are. With the iPad and iPhone presenting perhaps the best content discovery and viewing experience ever, you will be frequently challenged to find a place where you can consider AT&T's 3G network "fast".

This is evidenced by the recent news that the 3G experience on our new 3G iPad is crippled, stuck at an embarrassing 64 Kbps when streaming video on AT&T's network. The only way this is the fastest is when it comes to how quickly our customers are giving up trying and hitting stop, only to wait until they don't need to rely on this slow 3G network, and can tap into trusted WiFi. There are more videos, songs and game titles available for iPhone and iPad than for any other platform in the world, but AT&T's "fast" 3G network isn't fast enough.

Third, there's "Talk and Surf at the Same Time"

AT&T recently highlighted the network's ability to talk and surf the Web at the same time on a single device. We know first hand that AT&T can make this claim only because they drop so many calls automatically, customers are still looking up the data on the Web before they realize the conversation has been interrupted. AT&T's fine print shows you can surf the Web and talk at the iPhone at the same time, so long as you are only talking with yourself. We don't want to reduce the reliability and high customer satisfaction of our iPhones and iPads by sticking with AT&T.

In addition, AT&T has promised network upgrades every year that would withstand the high demand from our customers. We have routinely asked AT&T to deliver the ability to tether iPhones to laptops or iPads, or any mobile device, to provide Internet access, for a few years now. We have never seen it. AT&T publicly said that tethering would ship in late 2009, then the first half of 2010, and now they say the second half of 2010. We think it will eventually ship, but we're glad we didn't hold our breath. Who knows what level of mediocrity they would ask us to accept?

Fourth, there's HTC and BlackBerry and Nokia.

To achieve a long partnership when working in mobile, companies need to be working together as one. But despite our exclusive agreement with AT&T for them to be the sole wireless carrier for our devices, they never returned the favor, offering to sell only Apple mobile devices - despite the fact ours are the best. Many of AT&T's alternative partners, including HTC and Nokia, are actually in the middle of deep, intricate lawsuits with us, and we cannot abide with a "partner" who makes deals with these other companies behind our back.

Although AT&T claims to be offering a wide family of devices with a family of mobile operating systems, at Apple, we recognize that it is support of all these other devices which is slowing their network down, and reducing accessibility for the only customers who really matter - Apple customers, who have proven themselves as valuable and more intelligent customers because of their computing device choices.

When carriers open up their networks to competitive products that are infringing on our patents, which we will defend tirelessly, we cannot trust that those clients are not reverse-engineering our hardware and software by intercepting our wireless signals. We cannot risk the security and trust of our customers by spending another day sharing the spectrum with cheap knockoffs such as these.

Fifth, there's Sex.

Apple is sexy. I famously once asked a job applicant at Apple, "Are you a virgin?" Some of these AT&T drones, and their entire business, have absolutely no sex appeal. There is nothing sexy about telephone wires, counting minutes and pixelated video. Apple's revolutionary multi-touch interface and hardware doesn't need to be made impotent by being tied to such a soulless and emotionless corporation who cannot deliver in the boardroom, let alone the bedroom.

Even if AT&T were to redesign their sterile Death Star-like logo to be hot pink and they started every commercial with electronic house music, it would not solve the problem that their access is terrible, their leadership is poor and they are pulling us down like an oil slick takes down a seagull.

Sixth, the most important reason.

Besides the fact that AT&T does not offer fast 3G access practically anywhere in the country, constantly drops standard voice calls in every place in the country, cannot handle our current demand from its elite Apple customer base, and cannot be expected to upgrade their network or deliver basic features, such as MMS or phone tethering, on a schedule that is even close to its competition, and that they lack loyalty and sex appeal, there is a more important reason we do not want to move forward with the AT&T relationship with iPhones and iPads. We have discussed the many downsides of this AT&T contract, and how it has crippled our revolutionary devices, but AT&T wants you as consumers to pay more for the privilege of getting screwed.

We know from painful experience that bad customer service does not always return an inexpensive price. After all, look at Microsoft Office or Adobe Creative Suite for two examples of hugely expensive products that stink. AT&T must have gone to the same school of price gouging and marketing to come up with their strategy to charge Apple customers, because many of you are paying triple digits each month just to get your phone to see two or maybe three bars a few hours every day.

This becomes even worse if AT&T tricks you into purchasing an unlimited data plan for your iPad or your iPhone. You are paying upwards of $30 a month for data alone, only to find you can't download hardly anything over AT&T's network, because you can never get to it. Again, we cannot accept an outcome where our customers are blocked from using our innovative devices because their downstream Web services and applications are inaccessible on the network.

Our motivation is simple - we want to provide the most advanced and innovative platform for our customers, and we want them to pay a fair price for high quality. At Apple, we aren't shy about asking customers to pay the most if they are getting the best, and we will always deliver the best the world has ever seen. We want to continually enhance our offerings so everyone wins. AT&T is standing in our way and yours, and we want to delight you in the way we know we can.

Conclusions.

AT&T was created in the 19th century for a time of operator switch boards and later, rotary phones. Wireless is a successful business for AT&T and we can understand if they don't understand this new world of 3G, high speed data and next generation mobile devices. This new era is all about instant access and real connections - calls that complete, downloads that actually happen, and openness for the best hardware platform in the world - all areas where AT&T falls short.

The avalanche of wireless carriers begging to be associated with Apple's mobile devices demonstrates that AT&T is no longer necessary for Apple's iPad and iPhone to move forward. The millions of phones we have in consumers' pockets around the world show that our ecosystem is thriving, despite having AT&T as a boat anchor in our home country.

New standards for download speeds, connectivity and real-time application response will win on mobile devices like the iPad and iPhone. Perhaps AT&T should focus more on creating access points and any connectivity at all, rather than criticizing Verizon and other mature carriers for delivering good products. Apple is going to leave the past behind. You just wait.

May, 2010

Who's to Blame for Snow Leopard Disabling My Adobe CS4 Licensing?

Yesterday, like many other Mac geek faithful this weekend, I got my hands on a copy of Snow Leopard, the name of Apple's latest operating system upgrade, Mac OS X 10.6. Though I knew it reportedly had few major feature enhancements, all signs online pointed to it being a harmless upgrade. Even comments around Adobe CS3's having issues pointed to clean sailing with CS4. But my experience, so far, has been anything but clean, and it's not exactly sure what caused the issue, or what will be needed to solve it.

As you may recall, in May, we had to do a little song and dance with Adobe's tech support team to download the full version of the company's CS4 product. But since then, I've been using the product suite practically every day. In fact, practically every blog post you see here features screenshots or graphics that have gone through CS4. But this one won't, unfortunately, and it's like I am operating with one hand behind my back.


My Photoshop CS4 Forgot I Had Permissions to Use It
The issue is an odd one. When trying to start up any of the CS4 products, be it PhotoShop, Illustrator, In Design, or the others, I am simply told that "Licensing for this product has stopped working". The error encourages a restart, and yet, following restarts (plural), the issue remains - suggesting I tell tech support, which I will, but am not extremely excited about, especially after May's fun.


Illustrator Mocked My Trying to Launch It As Well
I have to assume that the issue has arisen as a result of Snow Leopard clawing its way on to my Mac. After all, Photoshop worked before the install, and doesn't work after, and nothing else changed. So far, online repositories aren't much help, and it's not clear which of the three players is at fault - Apple, Adobe, or me. (It could always be the user's fault). I have seen others say their CS4 apps are working great with Snow Leopard, but mine sure aren't. Maybe it's because they had the retail boxes, and going for the download version is coming back to bite me. I sure hope not.

I sent a note 1-1 to an Adobe rep who wrote me back in May, and look forward to seeing if she responds Monday. I'd be curious to see if this is a "Louis-only" issue, or if this is more widespread, and see why this is happening. Until then, get used to text only, or big juicy screenshot images with no resizing and cropping.

Adobe Responds to Service Flub, Promises More Coaching

Earlier this week, I recounted a less then ideal conversation with support representatives from Adobe around my attempting to buy the downloadable version of the company's Creative Suite product. One support rep urged me to buy the physical copy, and another called it a "very big order", despite it just being a single version of a single product. Later in the day, after another amusing live chat with an online support rep, I managed to get Creative Suite after all, about 24 hours after my initial purchase attempt.

To complete the story, today, I got a call from an Adobe representative, apologizing for what she called "inadequate information" I had received, and she added "we will see that the Agent is coached appropriately."

While I felt somewhat sheepish for airing out my grievances for the exchange on the blog, I said I tend to be transparent for both good and bad experiences, and she took the feedback well. Despite Adobe's being lamented on some social sites for not being very active, she wrote me in an e-mail:

"The feedback you provided is excellent, and we welcome any opportunity to be able to coach our staff, improve upon current processes, and understand a customer’s opinion of our services. You are welcome to continue to send comments our way."

While, yes, this could be a corporate spokesperson doing their best to reduce the temperature of a frustrated customer, it was a solid response, one that shows they are listening in a world where the customers also get a turn at the microphone.

The back and forth with Adobe at the beginning of the week can now pretty much be seen as a blip. I have the software. It works, and I was only charged once. And now, I know they can hear me.

Adobe: Our Products Are Expensive - And Don't Buy the Downloads

Last night I told you that Adobe failed my expectations for an instant download experience of their Creative Suite, looking like the company preferred to review every single software download manually. Now more than 15 hours later, I'm no closer to having access to the product I purchased, and if their support infrastructure is any indication, it might be some time before this gets resolved.

Along the way, I learned the company still has a long way to go before embracing true e-commerce and satisfying savvy customers.

Support Experience #1

Having seen my order still labeled as "Pending" in the Adobe Online Store, I called their "Purchase by Phone" toll-free number listed on the site, to see if I could push the order forward. After exchanging pleasantries with the support personnel on the line, I explained this morning...

Me: "I ordered the download version of Creative Suite last night, and the order shows as Pending. Can you see if it can be fulfilled or canceled, or what I have to do to get it moving forward?"

Them: "Has it been more than 2 hours?"

Me: "Yes. I ordered it last night, and it still shows pending."

Them: "Then the order is dead. I've seen that a few times today."

Me: "Dead? So what do you recommend?"

Them: "Well, first I would recommend never buying the download version. Always get the disks. You get an authentication code, can install on two computers, and can uninstall from the disk. I would never get the download."

Me: "But the disks and the box take up a lot of space."

Them: "No they don't."

Me: "Well, I would prefer the download version. What should I do?"

Them: "I don't deal with the online store. Let me transfer you."

Support Experience #2

I get transferred to a main customer service line. The quality of the call noticeably decreases, and a man named "Jerry", with a clear Indian accent, picks up.

Me: "I made an order on the Adobe Online Store last night, and it is showing as pending. I can give you the order number."

Them: (takes number... puts me on hold)

Them: "Your bank probably stopped the order. It was a big order - more than $1,000."

Me: "That's what your products cost. And I don't think it's the bank. I used my credit card."

Them: "Let me check while it is still pending." (puts me on hold again)

(Hold music warbles in with more static than notes)

Them: "Sir, it is your bank. We have released it. You should call your bank."

Me: "That doesn't make any sense."

Them: "Is there anything else I can help you with?"

Me: "No."

According to Adobe Online, my order is still pending. In theory, it could resolve this afternoon, or tomorrow, or next week. I can't cancel it. I can't move it forward. I can maybe call the credit card company, but I expect to get nowhere. But what I have learned (again) is that big companies that let bureaucracy get in the way of their customers will never win the customer service game.

Hey Adobe, I have the money. If you think this order is too big, lower your prices. If you think I shouldn't download your product, don't offer it. And if your phone sales team can't see the online side, you should find a way to get them talking.

Dinosaur Adobe Manually Reviews Download Purchases

After years of working on outdated desktop software, I was all set to bite the bullet tonight, and upgrade to the latest Creative Suite family from Adobe. Not interested in cluttering our already-cluttered home with boxes of software and CDs, I was pleased to see I could order a download version of the suite, and potentially have it tonight, installed and running while the twins slept. But for some bizarre reason, probably having to due with an overwrought insecure obsession with piracy, Adobe says it will review the order manually, in the next business day, and then, assuming I pass, I'll get permission to download what I bought.

Crazy. Dumb. Antiquated.


Seriously, Adobe? You're Reviewing a Download?
It's one thing to order a physical item from Amazon.com, the Apple Store, or Zappos, and expect it to ship in a few business days. But downloads? Instant or not at all. This is part of why iTunes has been so successful. Click to purchase, and you are downloading immediately. Same goes for Netflix's "Watch Instantly", and practically every other legitimate software download service.

What if I absolutely needed Adobe's software tonight? What if I were in a creative agency on deadline working the weekend? Could I tell a client that no, I would be unable to open their project in the latest version of InDesign or PhotoShop because Adobe was going to review my order the next day? It's almost enough to make me check out BitTorrent.

There's a reason Web services are replacing the old dinosaur software companies. They are more agile and more forward thinking. Maybe I'll get approved and get the software I paid for by tomorrow. But this is completely ridiculous. The world is moving to a real-time Web, and this is anything but.