MyEclipse :: View topic - "Professional" subscription pricing [Closed]

MyEclipse: "Professional" subscription pricing [Closed]

LathamJohnP - Jul 13, 2005 - 09:42 AM
Post subject: "Professional" subscription pricing [Closed]

Just read the July newsletter with the reference to the new "Professional" level subscription.

You just lost a customer.

The reason I shifted away from proprietary IBM products (WAS, WSAD) to free software was to avoid getting gouged for features that should be in the vanilla product (IBM wanted six figure sums to get a single feature in their Enterprise WAS that was needed to make EJB caching perform acceptably). My projects now use a completely free runtime platform, but I've compromised my principles on the IDE front because it seemed like MyEclipse wasn't out to gouge me.

So, this will be my first and last year of any MyEclipse subscription. Next year I'll work out ways to achieve the same with plain Eclipse and free plugins.

FWIW, if you moved to a JBoss model (pay for support, even with different levels) I'd happily pay to stay with you.

John

todd - Jul 13, 2005 - 03:27 PM
Post subject:

John,

Quote:

Just read the July newsletter with the reference to the new "Professional" level subscription.
You just lost a customer.

I'm very sorry you feel that way. Perhaps I can share with you some of the motivation behind this decision to add a new support level, and you'll will understand why we chose this direction.

Quote:

The reason I shifted away from proprietary IBM products (WAS, WSAD) to free software was to avoid getting gouged for features that should be in the vanilla product (IBM wanted six figure sums to get a single feature in their Enterprise WAS that was needed to make EJB caching perform acceptably).

Please don't damn us for the practices of others. We've been burned by such things in the past as well and don't like them any more than you do. We started MyEclipse to provide professional quality tools at a price that an individual developer can afford, and will continue to do so. The new features of the standard product in 4.0 are daunting (WYSIWYG JSP/Struts/JSF designer, Tapestry, Spring, etc...) and we'll continue to place most of our development focus there for all things "J2EE".

Quote:

My projects now use a completely free runtime platform, but I've compromised my principles on the IDE front because it seemed like MyEclipse wasn't out to gouge me.

And we're not out to gouge you. Let me give you some history on how we made this decision so hopefully you can understand where we're coming from.

Several months ago we had many of our enterprise customers come to us with requests for a few features which would greatly benefit them; specifically UML modeling and Oracle-specific database editing enhancements. The problem with providing these features for us, as a small company, is the large development and maintenance expense we would incur. Additionally, since these new features might be of little or no interest to many of the developers in our core customer base, we felt it would not have been fair of us to raise our subscription price for everyone, just to add features that benefited our corporate clients. So, instead we adopted a "pay for benefit" model for these new, "corporate" features so that only those that found additional value in them would be asked to help us defray the cost of implementing and maintaining them. You can look at the professional level as a new product that's basically a UML modeling tool. We just allow you to choose not to pay for UML if you don't want UML. By the way, the additional $20 we ask for the new subscription level won't come close to paying for the implementation costs, but it should defray the additional costs in supporting and expanding those features over the years.

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FWIW, if you moved to a JBoss model (pay for support, even with different levels) I'd happily pay to stay with you.

Actually, you can think of our subscription model as exactly that, although admittedly many people don't understand it at first. We charge for membership (support) we don't "sell" software. By subscribing to MyEclipse, you enable us to continue our product development effort, port our products to new Eclipse versions, and answer all forum questions that come up. What you get in return are the most cost effective J2EE and UML modeling tools on the market, as well as all enhancements and updates we make to them throughout the year.

We greatly appreciate all of our customers. In fact, thaty's why we'll be honoring all existing licenses as "pro" licenses throughout their duration and will also allow renewing for another year at the "pro" level for the same $29.95 when MyEclipse 4.0 is released. Those really aren't the actions of a "gouger", are they?

John, I hope I've given the extra insight into our motivations that you needed to persuade you to stay with us, at whatever level you like for as long as you like. If not, I wish you well in your future development endeavors.

Best regards,
Todd Williams
VP Technology, Genuitec LLC

LathamJohnP - Jul 14, 2005 - 02:28 PM
Post subject:

Thanks for the considered, detailed, and well argued response.

I didn't make it clear in my last post that I consider MyEclipse is a quality piece of software, a code base that deserves to succeed.

I understand your motivations and cost pressures, however it feels like a bit of a slippery slope.

You're doing everything you can to keep the IDE cheap and be nice to developers, but I think you're bound to fail.

There's something a bit perverse about building proprietary extensions to a free (as in speech) IDE framework, but I'll keep my objections pragmatic :-)

By relying on revenue from license fees (and keeping the software closed source) you are cutting yourself off from the free software developers who would otherwise use (and improve) your product.

Also, as you've found, license fees may not cover the costs as the sophistication of your software increases. You'll be faced with slowly increasing license fees, whilst simultaneously losing market share, as developers go back to using vanilla Eclipse and free plugins. Then you'll have a WSAD on your hands, which IBM seems to have pretty given up charging people for, using as a loss leader for WAS.

If the main drive is coming from the corporate customers, why not get them to sponsor the development directly, or (as JBoss have done) charge for support and make the software free. Corporate IT managers get all twitchy when challenged about "unsupported software".

Compare the fortunes of JBoss vs the Bitkeeper folks.

Anyway, good luck!

John

todd - Jul 14, 2005 - 03:41 PM
Post subject:

John,

Quote:

Thanks for the considered, detailed, and well argued response.

You're certainly welcome. I intend this to be another one.

Quote:

I didn't make it clear in my last post that I consider MyEclipse is a quality piece of software, a code base that deserves to succeed.

Thank you very much. We appreciate the support.

Quote:

You're doing everything you can to keep the IDE cheap and be nice to developers, but I think you're bound to fail.

Naturally, I wholeheartedly disagree. Over the last two years we have successfully built a market niche at a very low price point and have been profitable here for quite some time. With the rapid uptake of our software in the market place, our future only looks brighter. In fact, when we initially released MyEclipse over two years ago, the $29.95 price was intended to be "introductory" at that time. You can see that even today if you look at the graphic our installer shows during the installation; I believe "introductory" is still in there. Well, we succeeded even past our own expectations and became profitable at this price point. Since our goal isn't to be maximally profitable, but rather just profitable enough to keep expanding and paying our development team, we chose to leave the price where it is. During that time, MyEclipse has expanded from about 20 plugins to around 170 and has increased the breadth of its capabilities over 100x. All for the same price, and all while remaining profitable. So, you can see that rather than "bound to fail", I consider us "bound to succeed" at this point, based on history.

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There's something a bit perverse about building proprietary extensions to a free (as in speech) IDE framework, but I'll keep my objections pragmatic :-)

Genuitec, and the other 100 members of the Ecilpse foundation, formed Eclipse so we could build great open source technology upon which we could all build commercial products that serve a wide variety of markets. From the profits we derive from our products, we pay our developers to work on both Eclipse itself and our own products. Without the money from commercial products like ours, IBM's, SAP's, HP's, SAS's, Intel's, and others to support the Foundation, there would be no Foundation, and no Eclipse. So, it's not perverse at all; with Eclipse it's explicity by design. This virtuous cycle is why the Foundation is successful and Eclipse is so good.

Quote:

By relying on revenue from license fees (and keeping the software closed source) you are cutting yourself off from the free software developers who would otherwise use (and improve) your product.

Actually, we're not cut off from anything. There are lots of developers working at extending Eclipse in open source. When their work is of benefit to our customers we may choose to incorporate, integrate, and extend that work to productize it in MyEclipse. So, we still have the entire Eclipse-space of open source to draw from, if we choose to do so.

Quote:

Also, as you've found, license fees may not cover the costs as the sophistication of your software increases. You'll be faced with slowly increasing license fees, whilst simultaneously losing market share, as developers go back to using vanilla Eclipse and free plugins

Actually, license fees cover the costs very well, as I articulated earlier. With the deeper market penetration we see as time goes on, we'll be able to continue to add features indefinately. The issue with the features in the Pro version is that our enterprise customers wanted them delivered faster than we felt we could recover the costs in the base product. As a result, we came up with a deal with several of them that they'll immediately upgrade to the professional license for all their developers upon delivery. Think of this as a way for them to risklessly fund the development as they agreed to pay (through upgrades) on delivery. So, the features got accelerated in our plan simply because they were willing to fund the work right now.

Quote:

If the main drive is coming from the corporate customers, why not get them to sponsor the development directly, or (as JBoss have done) charge for support and make the software free.

Rather than sponsoring directly, as with a consulting agreement, it's much easier to get many more customers to agree to upgrade upon delivery, due to the simplicity of the model and reduction in risk. With this approach, we got several large customers on board without having to negotiate consulting agreements, for the same work, with each of them. It's a much simpler way to do business.

You'll notice we don't "sell software" outright; we operate a subscription service for all support, maintenance, and enhancment for software on a yearly basis. Membership in the subscription service is mandatory in order to use our software for extended periods. It's simply that we don't believe in "throwing software over the fence" and making our customers deal with trying to use something that isn't properly supported. If you use our software, you'll get some of the best tech support in the industry. That's simply the way we believe in doing business.

Quote:

Compare the fortunes of JBoss vs the Bitkeeper folks.

JBoss has an interesting business model, but it's based on consulting only. We're both a consulting company and a software products company, and that works for us. And, the JBoss model is very high overhead (in terms of personnel) in that it requires lots of consultants, training, and logisitical support. That's just not what we're about. In fact, even Fleury admits the JBoss model works for them, but likely wouldn't work for others. He talks about the "Myth of Open Source" in Business Week. It's a good read if you're trying to compare business models. The link is: http://www.businessweek.com/technology/content/jul2005/tc2005078_5465_tc121.htm

Quote:

Anyway, good luck!

To you as well.

Best regards,
Todd Williams
VP Technology, Genuitec LLC

LathamJohnP - Jul 14, 2005 - 04:00 PM
Post subject: MyEclipse free???

>> MyEclipse software is free and has always been free <<

:shock:

What definition of "free" are you using?

Not this one surely...

http://en.wikipedia.org/wiki/Free_software

John

todd - Jul 14, 2005 - 04:24 PM
Post subject:

John,

Mea culpa. It was a misstatement in my post caused by lack of proofing my response. What I intended to say is that if it makes you feel better, you can think of our subscription fee as only paying for maintenance and support, which is mandatory. It was a "thought experiment" to make the model more acceptable to you that was poorly articulated. So, to be clear, we sell software and support using a yearly subscription model, not a purchase model, just like Sun and others have recently begun doing. Sorry for the confusion; I've updated my original post so as not to confuse others.

Best regards,
Todd Williams
VP Technology, Genuitec LLC

wseubert - Jul 14, 2005 - 08:41 PM
Post subject:

To stick my nose in...

Hypothetically, lets say there are free plugins that I could assemble on my own that would give me the same functionality provided by MyEclipse. In other words I had an actual choice between MyEclipse and 100% free.

I would still gladly pay the $50 per YEAR for someone else to integrate, maintain, improve, package everything in one installer, and answer all of my silly questions about their product and the other things I'm using like MySql and Tomcat.

I add value by developing software, not integrating tools.

Thanks for the great product and support.

todd - Jul 14, 2005 - 09:16 PM
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Now that is a very pithy statement of our core value proposition!

Quote:

Thanks for the great product and support.

And you are very certainly welcome. Thank *you* for your patronage!

Best regards,
Todd Williams
VP Technology, Genuitec LLC

LathamJohnP - Jul 15, 2005 - 08:10 AM
Post subject:

wseubert,

Interesting perspective.

So now that you have found Eclipse, do you use any other plugins?

>> I would still gladly pay the $50 per YEAR for someone else to ... answer all of my silly questions about ... MySql and Tomcat. <<

I'm amazed that you go to MyEclipse for help with Tomcat and MySQL. I had never considered asking my IDE vendor for help with my database or web server. Maybe that's partly because I've rarely had a problem solved by a support organisation that wouldn't have been solved faster with a bit of googling or looking at the source code (not talking about MyEclipse support - I've never used it).

>> I add value by developing software, not integrating tools.<<

Yeah, and Java development doesn't feel like that often enough :-)

My view has been skewed recently by a transition from proprietary software (WAS, EJB esp. CMP) to free alternatives (Tomcat, JBoss, Hibernate, Spring). Now when I have a problem I just look at the source code and reference documentation - I very rarely feel the need for support.

I had a very bad experience with maintaining CMP mappings for a complex app in WSAD - the file formats were essentially undocumented, so when the IDE failed we were screwed. That makes me very nervous relying on closed source tooling - you're at the mercy of your vendor.

John

support-scott - Jul 15, 2005 - 02:09 PM
Post subject:

Quote:

I had a very bad experience with maintaining CMP mappings for a complex app in WSAD - the file formats were essentially undocumented, so when the IDE failed we were screwed.

And I'll chime in and say that that *is* a problem if your tools implement any proprietary solutions. MyEclipse does not - we simply help the developer to generate required configuration files for existing tooling standards (struts, jsf, tapestry, spring, etc). So, this argument does not apply to MyEclipse in the least.

However, John looks determined to go his own way and we've spent well more than $30 dutifully explaing our position in this thread. With that, I'll close this thread as we obviously, respectfully will have to agree to disagree.