A year ago I wanted to upgrade my licenses. I even wrote an article about my experience.
I think this unpublished article (rejected by xDev as being too “mathematical” ) contains some things which should be generally knows to people interested in upgrading their licenses.
So I’m posting it in a new thread instead of burying it in another one.
To Upgrade or Not to Upgrade?
Can 82% off really be a bad deal?
If you are thinking about upgrading your Xojo license then it might not be as straight-forward as you think if you have a current license. I ran into this when I tried to take advantage of a “Programmer’s Day” Special.
In 2012 Xojo had a very special offer: get 24 months of updates for the price of 12 months. I’m not a professional developer, I’m a Molecular Biologist, but I could see the writing on the wall in my profession: you don’t see anyone older than 40 working in the Lab anymore as was still the case just ten years ago. At 50 I was therefore way past my “use by” date, so a career change seemed advisable. And, as if to hammer home that point, I had become unemployed just a few months before, with prospects of a new job non-existent.
So going for the update wasn’t an easy decision to make as money was tight. But Xojo had also just announced that their licenses were being restructured and prices were going to change (see http://www.realsoftwareblog.com/2013/04/coming-soon-new-pricing-recap.html):
[quote]Speaking of licenses, anyone who has or had a modern Real Studio license (2005 - present) will have their license automatically converted as follows:
Personal => Desktop
Professional => Desktop + Console + DB
Web => Web + DB
Enterprise => Desktop + Web + Console + DB[/quote]
I had an expired Enterprise license (took advantage of a very good offer to upgrade my Pro version a few years before) that was being split into Desktop, Web, Console, and Database. I had no need for Web, Database or Console, so in September 2012 I decided to renew just my Desktop license.
I wanted to extend for four years, but was that wise? Would the company still be around in 2017? After all, 2012 was not exactly a good year for Xojo. I had the feeling that the company was having some difficulties, so on the one hand I wanted to support them, on the other hand I’m not in a position to give money away. Furthermore the challenges were daunting: could Xojo Inc keep up with all the changes on the horizon: iOS, 64bit, LLVM in addition to the rapidly changing MacOS and the imminent arrival of Windows 8? Would I even still be alive in four years time? On the other hand: that’s basically 50% off, I’m a sucker for bargains, and it would be an investment into a (hopefully) bright developer future.
So after much to-ing and fro-ing I took the plunge and extended my Desktop license, and not just once for 24 months, but twice till September 2017. Risky, and a leap of faith on my part, but I thought it might just turn out to be a shrewd business decision.
And it was. In December 2012 Xojo had another great offer for me: update your Desktop license to Pro before the price increase. Which I did, so Database and Console were back with me. Note that Web was specifically excluded from the offer, so it wasn’t a “normal” Pro version.
Fast forward to now.
Big changes have happened. Xojo restructured their licenses (twice) and increased their prices, in some cases by a considerable amount: Console went from being included to 50 to 240. Pro went from 250 to being split up and not being available as an option to 800 (though to be fair it now also includes the Web edition).
I still don’t have a need for Web (and the forthcoming iOS will not be included for free with Pro, so that was not a consideration), but I’m still a sucker for bargains. So when Xojo announced their “Programmer’s Day Special” I was tempted by the upgrade offer at the bottom of the flyer:
Already have a Xojo license but need more functionality? Email us and ask for your specialized Xojo Pro upgrade price, we’ll give you 30% off an upgrade to Xojo Pro through Programmer’s Day!
I also had a 10% off voucher that I would be able to combine with the offer. So how much would it be to upgrade my Desktop/Database/Console licenses to include Web and make it equivalent to Professional? I have the expired Web edition, so I would need three renewals till September 2017 = 160*3 = 480 - (30% Special + 10% voucher) = 288. Veeery tempting. No real need, but hmm, let’s ask for a quote before the sale expires, then at least I have more time to think about it.
So I did. And received the following two options:
Now quote 1 makes no sense. This quote is for a 12 months Pro license, so I gain the Web edition in addition to the Desktop/DB/Console I already have. An upgrade to my expired Web license would only set me back 160. Why would I pay 200 more for it???
Now quote 2 looks like an unbelievable offer at 82% off - and unfortunately it is. Don’t be taken in by the massive “discount” that seems very tempting at first sight - it is only tempting until you realize that beside paying 217 you also trade in 2 of your 3 years worth of Desktop/Database/Console and all just for 1 years worth of Web!
I would get a 160 value (for a Web renewal) by paying 217 and relinquishing 2 years from my active licenses (worth 720) which are valid for three more years!
To be fair Pro also includes Priority support, Beta access, 3x feedback multiplier, and Consulting leads, but none of them are of any value to me. And maybe that’s the basic problem: Pro is a bundle that includes many items that are of no use to non-professional developers. Maybe there should be a bundle for them too at $599?
So what are my active licenses actually worth? Never mind what I actually paid for them: if I had to renew them from now that would be
[quote]Xojo Desktop renewal till 2017: 3x 120 = 360
Xojo Database renewal till 2017: 3x 120 = 360
Xojo Console renewal till 2017: 3x 120 = 360
Or so I thought.
Xojo thinks differently. According to Geoff Perlman, CEO of Xojo Inc:
I think I see where the problem is. You are using current pricing to calculate the value of your keys. Thats not how we calculate them. We calculate the value of keys based upon what the customer paid for them and how much time remains before they expire.
This is a bombshell.
It basically introduces different types of licenses depending on how much you bought it for. Or to paraphrase Orwell: “Some licenses are more equal than other licenses.”
Let me illustrate the problem with an example: assume you bought Apple shares at $50. They increase to $700. Someone wants to buy your shares. You say Sure, you can have them for $700. They say But you bought them for $50! So they are only worth $50. I offer you $60 and that is a GOOD offer!
I don’t know about you, but I dont think so - but if you do then let me know and I buy your Apple shares!
When Xojo increased the license price the value of my licenses increased accordingly. That is how the REAL World works. If Xojo works to a different set of rules then they need to let their customers know.
For example what about those who bought their Desktop license with the MacHeist bundle (10 apps including Xojo) for $19.99? Is their license worth only $1.99 when they try to upgrade to Pro? Can they actually upgrade or do they need to buy a new license? What about anyone buying at a “special offer” price?
So don’t be too tempted by big discounts - run the numbers. For me Xojo’s unique upgrade policy means it would be economic suicide to upgrade at any point within the next three years. That’s a shame. I have the money ready, Xojo could make a sale, but as it is I will have to wait. Only after my licenses will have expired shall I be on equal footing to other license holders again, and upgrades make economic sense again.
So can a discount of 82% really be a bad deal? Going with Xojo’s “82% discount offer” would leave me 720 + 217 - 160 = 777 worse off. So surprisingly the answer is: yes.
Well, for me at least. It would of course be brilliant business for Xojo
_______________ [End of article]
To avoid any misunderstanding:
I’m not saying that a license with 2 months left on it has the same resale value as a license with 12 months.
I’m saying that I have an active and current license that I would have liked to upgrade, but that Xojo treats the license differently because it was sold at a discount. In effect they want the discount back in order to allow me to upgrade.
So in essence I have “second class” licenses.