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Waves Discontinues Perpetual Licenses (UPDATE: They have gone Subscription Only)


Martin H.

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Under chapter 3 of the Consumer Rights Act 2015 EU/UK

Chapter 3 of the Consumer Rights Act 2015 covers contracts between a trader and consumer in relation to digital content, as distinct from goods and services, whilst also clarifying that any goods containing faulty digital content are protected by the remedies provided for faulty goods

is waves faulty now? lets claim refunds or free updates

 

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16 minutes ago, dee said:

is waves faulty now? lets claim refunds or free updates

One could argue Waves has always been faulty.. come to think of it, I can somewhat imagine Basil Fawlty and Manuel and the team running it.. it could explain a lot 🤣

I have wondered about the legal side of things from Waves and this change. They would want to hope they have that rock solid, otherwise it could get very costly.

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1 hour ago, Fleer said:

Heck. Life’s a sub. 

Well dang, if you're gonna look at it along them lines, I'd say life is more like Cakewalk's "Lifetime Updates": you 'buy in' for life and then it dies on you unexpectedly and before too long, taking all you gave it with it. You didn't see it coming, but someone up there knew all along. To top that off; even if you could look back on it all afterward, you'd only see that every day above ground was a pyrrhic victory. 

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28 minutes ago, MusicMan said:

There's a lot of old dinosaurs mentality where they still think they're king and haven't reassessed the current market and competition which is definitely a recipe for running the companies into the ground.

There's also plenty of "new blood" upper management who believe because they've worked in a similar position at another company without completely ruining it that they can stroll in and "take things to the next level." With a similar lack of understanding of what has made the company successful, what the company is really about. See Carly Fiorina at Hewlett-Packard 1999-2005.

I have many personal stories from when I worked in IT that I won't go into. But here's one: there was a VP of IT at one well-known software company who I drew the short straw to run over and help them drag their email child window out from behind the parent program's main window. When I did so, and then, by way of showing them how to quickly and easily get themselves out of the situation, dragged the window back behind the main window, the person literally cried out because they thought I was "breaking" it again. This was not the VP of accounting, marketing, sales, HR or any other "soft" department, this was my Big Boss, the VP of Information Technology. Freaked out at a program's child window going behind the main window.

This person's flagship project at the company was setting up a unified contact and sales management program for the sales department. This was a media company in the mid-90's, and it was traditionally a MacOS company that had only recently ported its software to Windows. So it had become a "dual platform" company where every employee was getting two workstations, one Mac and one Windows. Of course, for 90% of the workforce, this meant that one of those was "their computer" and the other one was a box that sat there in case someone forced them to look at something on the other one. And, of course, I don't even need to tell you which OS was most people's preference, and by preference I mean like being on one side of a rabid sports rivalry. People had posters up in their cubicles making fun of....I'm not going to say which platform because I don't need to.

So what was the infrastructure of this grand project going to look like? Every salesperson would get a brand new shiny....Toshiba Tecra Windows 95 laptop to carry with them wherever they went. They would use these to dial into a bank of modems. When I say that the delivery of these (very nice and expensive for the time) laptops to the sales staff were welcomed as if someone had delivered a horse turd pizza and told them they would be forced to survive on it, I'm only exaggerating a little.

There were scenes, and people swearing that they would have nothing to do with it. Although my preference did and does lean toward using Windows systems (although I like my Macs just fine), I fully sympathized with the salesforce in question. Although I personally think such partisanship is silly, I do acknowledge that it exists and that for the people who feel that way, they just do. They likely took a certain amount of pains to get jobs at a Mac-centric company, and now suddenly not only was Windows starting to look like a bigger threat in the multimedia content creation market, they were being told they would be using it daily for a mission-critical task.

All because this twit, who had been VP of IT at some financial company who if they had any Macs in the place, they were certainly in the art department, was oblivious to a huge aspect of the corporate culture. They probably weren't even aware that there were people with a passionate preference for one computing platform over another. To them, a computer was just another business machine like a FAX machine, and who on earth worries about what brand of FAX machine they use? But this was a consumer computer software company, and the people who worked there, even the ones who were not programmers, were, duh, passionate about computing. Computers weren't just business machines, they were constant companions that you poured your creativity into.

The project rolled on, investment well over a million on it. The Big Boss gave presentations at the supplier's conference about how successful their implementation and rollout was going. I hated it because every time some issue involving it came up, it turned things into panic mode. OMG, one of the database programmers can't connect to the server, run over there immediately and DO something!! No I don't know if they tried rebooting! it's a 4 alarm emergency!! We were busting our butts to deliver something to people who were prejudiced against it before they even saw it in action. At the direction of people who were blissfully unaware of or in deliberate denial about what an enormous turd they were laying. What....fun. How....fulfilling.

I could say a lot more, but I'll just mention that I checked back in a couple of years after I had left the company (which I did by bouncing my pager across the conference room table at my boss, who had been dressing us down for not wearing our pagers when we were off duty-not part of the job description. I told him I wouldn't do it because I didn't trust them or the big boss to correctly judge what constituted an "emergency" and said, "y'know, what, you can have the damn thing." Pewwwww.). A few years later I asked a friend who was still there whatever became of the big flagship project, and he told me that while it did go online, nobody ever actually started using it. There was one person they had hired to enter data into it, and she kept doing her job, merrily entering data into it that nobody ever touched. Over. A. Million. Dollars. In 1996 money.

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Subscriptions are extremely profitable and significantly cut down on overhead / developer size / ecommerce headaches, and help with piracy (last one is debateable).  That's why companies use them. 

This isn't to say these models are always successful. Some fail spectacularly. Time will tell if Waves does well with it.

Complaints about subscription services likely make up half the internet at this point. Adobe went through hell with theirs, even prompting a Change.Org petition and an entire Wikipedia page dedicated to all the criticisms from designers and shareholders. Despite that, SEC filings showed that customers were choosing Creative Cloud over CS at a ratio of 4:1 prior to their move to pure subscription. In other words - the angry minority were completely overshadowed by the majority of customers.

I assume it will be the same with Waves. If I were to judge by internet forums, virtually every software company (gaming, music, design, etc.) should be out of business because of consumer complaints. Yet, most of them...especially those running subscriptions....are doing extremely well. This Waves switch is likely no different - it's probably a welcome change for the vast majority of users, most of which likely never hang out on / post on forums. I think companies are starting to realize that internet forums are a total ****hole of outrage and have stopped listening to them when making critical business decisions. 

 

 

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1 hour ago, Carl Ewing said:

Subscriptions are extremely profitable and significantly cut down on overhead / developer size / ecommerce headaches, and help with piracy (last one is debateable).  That's why companies use them. 

This isn't to say these models are always successful. Some fail spectacularly. Time will tell if Waves does well with it.

Complaints about subscription services likely make up half the internet at this point. Adobe went through hell with theirs, even prompting a Change.Org petition and an entire Wikipedia page dedicated to all the criticisms from designers and shareholders. Despite that, SEC filings showed that customers were choosing Creative Cloud over CS at a ratio of 4:1 prior to their move to pure subscription. In other words - the angry minority were completely overshadowed by the majority of customers.

I assume it will be the same with Waves. If I were to judge by internet forums, virtually every software company (gaming, music, design, etc.) should be out of business because of consumer complaints. Yet, most of them...especially those running subscriptions....are doing extremely well. This Waves switch is likely no different - it's probably a welcome change for the vast majority of users, most of which likely never hang out on / post on forums. I think companies are starting to realize that internet forums are a total ****hole of outrage and have stopped listening to them when making critical business decisions. 

 

 

Adobe Photoshop was the de-facto standard for raster editing back then. Illustrator still is the preferred vector graphic software (yet some studios around the world are using CorelDRAW). Adobe Premiere is currently losing ground to DaVinci Resolve Studio (lifetime 2-slot license that gives free updates to future versions).
 

Waves was never the audio production/mastering de-facto standard to begin with. They also weren’t the Avid of audii plugins.

Of course they have the right to try ruin their own business. With no doubt many other developers will profit from Wave’s losses of customers. One could easily find one of the many online lists of Waves plugins alternatives - from pro-grade to cheap alternatives to free ones. I believe it must have been a difficult decision to destroy a semi-successful audio software company. I’m afraid that what they used to earn with their endless sales they will never see again with their subs model.

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I don't like subscriptions for plugins, for all the usual reasons you could think of.  I pay for Splice and I get to keep the samples after I cancel. I pay for Output Arcade which will continu to work after I cancel (whatever I made up to that point of course). These are fair deals in my mind. But I'm gonna play a little devils advocate here. What if this is a briliant move? Don't boo me just yet.

1) We are living in the age of subscribtions. Despite rampant inflation we still have money left for weekly food boxes, 4 different streaming services and a gym membership which we never use. 2) BUT, that's just US. I mean, I don't know the exact demographic here, but I'm closing in on 40. I work with a lot of younger people, age 19-25, and they have a spending pattern I wouldn't dream of doing when I was that age. They order all their food. Despite having very decent fresh bean coffee for free at work, they prefer going to the Starbucks across the street. They have ALL the streaming services. They never bought a single song in their life. Everything is a stream, even MP3 is alien to them. They are renting transportation (cars, scooters, bicycles) for a day. 

This new generation, at least the ones I see, when/if they start making music, could very well choose a Waves subscription over buying UA plugins. So what if Waves is setting themselves up to becoming a marketleader once again? It will just take 5 years and a lot of (righteous) anger from current users. But the next Rick Rubin, who is currently finishing school while listening to Spotify Premium and ordering Über eats, might as well take the Waves subscription as a starting point in their career. So when Granny Eilish needs mixing, guess how many plugins in that vocal chain are purchased vs. a subscription?

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I disagree. There’s already competition from other great companies offering both perpetual and subscription services for the plugins.

Just look what’s happening right now for streaming services like Netflix, Disney+, etc. There’s competition and people stop subscribing to everything at the same time, so they see a decline of their number of subscribers. So I don’t see someone canceling a 10$ streaming service to spend another 25$ on Waves. There’s a smaller pie on the plugin world, with many birds eating at the same plate.

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7 minutes ago, Pragi said:

I wonder how long the licenses for my paid

Waves plugins will work?

 

That is the $64,000.00 question.

According to Waves they won't stop working (and they never have in the past even if users were not on WUP). They also say if you are on WUP you will get updates (to V14 only, or so it looks like)  until your current WUP period is over.

What is unclear (to me) is if they will give me V15 if it comes out before 25, Jan 2025 (when my current WUP is over). Only time will tell. I'm not holding my breath until then though.

Edited by Bapu
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What amuses me in all this is the stance that people here are going to deinstall working plugins in protest to the change in business model by Waves.

I mean we hear of people on V13 plugs (and earlier) that say they still work.

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5 hours ago, Carl Ewing said:

customers were choosing Creative Cloud over CS at a ratio of 4:1 prior to their move to pure subscription. In other words - the angry minority were completely overshadowed by the majority of customers.

So does this mean that if your product sells 100,000 copies at $200 each, and you make a change in the way it's sold that 20% of your userbase vehemently dislike, the opinions of 20,000 customers are not worthy of serious consideration because they're outnumbered? You're just going to write off that $400,000 in gross revenue.

I wonder why, if that 80% of the userbase was already paying for a subscription license by choice, Adobe even felt the need to force it on the ones who were so "completely overshadowed." I mean, if they're that insignificant, why not let them throw their pittance at you in whatever manner they prefer?

I'm sure Serif and any number of other companies would have gladly absorbed 20% of Adobe's userbase.

You suggested that this is "probably a welcome change for the vast majority of users," but since Waves already had the option to license via subscription, why would starting to force it on everyone who wants to use their products be a welcome change? Why would anyone care what license model another user is allowed to use?

People don't complain about it because they dislike that subscription licensing exists, they complain about not having an alternative.

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22 minutes ago, Bapu said:

What amuses me in all this is the stance that people here are going to deinstall working plugins in protest to the change in business model by Waves.

I mean we hear of people on V13 plugs (and earlier) that say they still work.

For those with Macs it’s inevitable for the plugins to become useless sooner rather than later.

Selling their plugins in protest might have been the best choice if only they knew that Waves is about to jump the sub train.

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42 minutes ago, Bapu said:

What amuses me in all this is the stance that people here are going to deinstall working plugins in protest to the change in business model by Waves.

I mean we hear of people on V13 plugs (and earlier) that say they still work.

Good read  and 

nothing happening   that stoles my sleep..

Edited by Pragi
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4 hours ago, Marina said:

Adobe Photoshop was the de-facto standard for raster editing back then. Illustrator still is the preferred vector graphic software (yet some studios around the world are using CorelDRAW). Adobe Premiere is currently losing ground to DaVinci Resolve Studio (lifetime 2-slot license that gives free updates to future versions).
 

Waves was never the audio production/mastering de-facto standard to begin with. They also weren’t the Avid of audii plugins.

Of course they have the right to try ruin their own business. With no doubt many other developers will profit from Wave’s losses of customers. One could easily find one of the many online lists of Waves plugins alternatives - from pro-grade to cheap alternatives to free ones. I believe it must have been a difficult decision to destroy a semi-successful audio software company. I’m afraid that what they used to earn with their endless sales they will never see again with their subs model.

Ah - yes - this is called moving the goalpost. The shareholder complaints (including lawsuits) and near 24/7 internet outrage porn over Adobe's subscription switch  also made the claim that it was terrible business decision and nobody would want it. Regardless of their near monopoly status in their industry. 

Revenue proved the opposite. Completely. It was grand slam success across the board and eventually led to 100% subscription model BECAUSE customers opted by a factor of 4x for subscription over stand alone products. Let me repeat - they offered consumers both options - and consumers chose subscription by a factor of 4. Them's the facts. 

As of 2023, roughly 20% of the $40 trillion dollar credit card processing market is subscription processing. That keeps going up, and up, and up. It will eventually take over virtually everything involving distributor-to-consumer sales. This applies to companies with near monopolies (Microsoft, Adobe) or industries with multiple subscription models competeting against each other (eg. what will now happen with Plugin Alliance and Waves, etc.). 

Do you think this happening because subscription models are bad for businesses;  a one way ticket to bankruptcy, and consumers hate it? Or do you think it's because it's enormously profitable and something consumers clearly want / use? One answer is correct and is proven year after year by revenue / profit models for (almost) every company that switches to it. 

Waves will likely do very well with this model despite the angry minority screaming away on the internet. And small developers will think this is opportunity to capitalize on angry consumers. This will fail, like it does in all industries where large competitors who can afford a robust subscription infrastructure wipe out smaller competitors. Happens every day.

Edited by Carl Ewing
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2 hours ago, Yan Filiatrault said:

I disagree. There’s already competition from other great companies offering both perpetual and subscription services for the plugins.

Just look what’s happening right now for streaming services like Netflix, Disney+, etc. There’s competition and people stop subscribing to everything at the same time, so they see a decline of their number of subscribers. So I don’t see someone canceling a 10$ streaming service to spend another 25$ on Waves. There’s a smaller pie on the plugin world, with many birds eating at the same plate.

Yes there is great competition. And yes some do offer both business models. But that was not my point. Perhaps I didn't make it clear, I can be longwinded sometimes. My point is (and Carl Ewing in the post above me hints at something similar) that customers will take the subscription. I don't, but many others do. I notice this with the younger generations I work with. So I get your point that from the current consumers perspective (and perhaps not even a majority), it would be better to offer both subscription ánd purchase. But they have a huge catalog, a huge userbase and an upcoming userbase who is used to- and prefers subscriptions. They will have to compete, sure, but as long as there are 10x more mixing tutorials using Waves plugins on Youtube than let's say Soundwide or PA or Slate or UAD (well...), I think they are going to be ok.

Heck, my first plugins were the One knob bundle plugins. Why? I didn't know anything about plugins, watched some tutorials, I remembered that Waves was/is a huge name, so let's buy Waves. Now translate that to a generation that subscribes instead of buys.

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1 hour ago, Bapu said:

What amuses me in all this is the stance that people here are going to deinstall working plugins in protest to the change in business model by Waves.

I mean we hear of people on V13 plugs (and earlier) that say they still work.

V9 plugins still work here!!!

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Like it or not, subscription is the future.

I'm guessing I'm the only guy on this board that took a perpetual software company to a subscription model - this is a topic I'm absolutely a subject matter expert on. I'm also rather proud that we navigated those waters successfully without institutional investment (thought we did almost run out of cash).

With predictable revenue from subscription we were able to staff up and increase the pace of releases - creating a LOT of value for our clients. Our software is used to run entire businesses, so the the constant innovation and support makes sense. It's been a great thing for our company and I think it's been good for our customers overall, but I know many of them have a different opinion - and I respect that.

Something else everyone here misses is that most businesses are valued on a multiple of their EBITA (ie profit). Software companies are usually valued on a multiple of their recurring revenue. So, a traditional business doing $10 Million in revenue with $1M in profit might be worth 3x or 4x their profit - a valuation of a $3M-$4M. The same company that does software with that $10M being subscription revenue (what we call recurring revenue) is worth closer to $30M (a 3x on recurring).

Which would you choose if you ran a company?

The reality is that a CEO's #1 job is to increase shareholder value. PERIOD. If the shareholders of Waves are thinking about a company sale, then moving to subscription is absolutely the right course of action.

All software companies over time that want to have a big exit and not stay a life-style business will move to subscription. The only question is how will they do it - and I think Waves has shown a great example of how NOT to do it.

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