CAD Software:

The Benefits of Ownership

Software provision has evolved from disks shipped in a box, to downloadable code, to
cloud-based tools accessible via the Internet. As delivery modes have changed so has the
concept of software ownership, and users today can buy software, rent it via subscription, or
pay a fee to access it online. When it comes to software rental vs. ownership, how can you
be sure you make the right choice? This white paper will explain the benefits of software
ownership and help you determine if its the best option to meet your needs.

CAD Software: The Benefits of Ownership2

CAD Software:
The Benefits of Ownership
Subscription applications arent the best option for every business.
Learn the benefits of software ownership vs. rental and how to
determine if its right for you.

ook around today and youll see it: Subscription software is

everywhere. Also termed software rental, it is an increasingly common offering among developers in consumer and
business sectors alike. Some software vendors, in fact, are moving
to subscription entirely. Adobe has eliminated Creative Suite perpetual licenses in favor of its Creative Cloud service. In the CAD
market, Autodesk is moving in the same direction. The company
stopped offering perpetual licenses for standalone products in
early 2016 and will have done the same for software suites as of
summer 2016. At that point, if you wish to license new Autodesk
software, cloud-based or desktop subscription will be your only
options for most products.
However, dont assume that all the buzz about software rental
means it is right for everyone. It simply isnt. In this white paper,
well discuss the benefits of ownership and which types of users are
likely to be better off taking the ownership option.

Rental Growing Slowly for CAD

From the editors of

Sponsored by

Software rental is popular with users because it makes the tools

more affordable and accessible than is typically possible via perpetual licensing. For example, a CAD solution that costs thousands of
dollars via perpetual license can be rented for a couple of hundred
dollars per month. Smaller companies and individuals, in particular,
are renting CAD software that was previously out of reach financially and reaping the productivity and business benefits that
help them compete with larger companies.
However, despite increased user awareness of cloud-based CAD
and increased subscription offerings by the software developers,
actual adoption is advancing slowly. According to the Business
Advantage Annual CAD Trends Survey 2016, cloud-based CAD
shows very strong future potential, but survey respondents consider the technology to be of low importance today, and current
use hovers at 11%.

By Nancy Spurling Johnson

Cover photo:
istockphoto.com/AndreyPopov

Thats tremendously lower than adoption rates of other major

cloud-based business applications, which hover around 80%, according to The Future of Cloud Computing 5th Annual Survey 2015
by North Bridge. Why the slower adoption in the CAD community?
Its partly due to the slower emergence of cloud-based CAD tools

CAD Software: The Benefits of Ownership3

Glossary of
Licensing Options
Modern CAD software is available via the following licensing
options, depending on the
brand.
Perpetual. This is a permanent
license and the option referred
to as ownership. In most
cases, you can use perpetually
licensed software for as long
as your hardware will support
it. To upgrade, you must buy a
new copy.
Cloud-based subscription. Also
called software as a service
(SaaS) and software rental,
this option runs software on
the cloud, accessed via Internet browser. The developer
updates the software continually, and users have access to
the latest version as well as
technical support. CAD data
may be stored locally or on the
cloud (or both), depending on
the service. A subscription runs
for a given period typically
annually, quarterly, or monthly
and when it ends, so does
software access.
Desktop subscription. In this
rental option, users install
software locally but can access
it only as long as the subscription remains active. Data is
stored wherever you see fit. If
you dont renew, software use
is terminated.
Maintenance subscription.
When you purchase perpetually licensed software, some
companies include the option
to add an annual maintenance
contract that typically includes
software updates and technical
support.

compared to those in other markets, but more significantly, its due

to users concerns about data security, the reliability of software
delivery, and the impact of poor Internet performance.

Benefits of Ownership
Software ownership remains strong among CAD users because of
its unique advantages over subscription. Purchasing software on
perpetual license and supporting it yourself is like owning a car:
Youre responsible for maintaining it, but if you do so properly,
youll be able to reap the benefits of your investment for years to
come. For many, software ownership is necessary to protect a business and the platforms and processes that support it.
More specifically, the benefits
of perpetually licensed software
include the following. (Note:
The items listed here are typical
but do not necessarily represent
every software product or every
license agreement.)

Software
ownership
remains strong
among CAD
users because
of its unique
advantages over
subscription.

Direct control over data security.

For many CAD users that opt for
software ownership, if not most,
the greatest single reason is to
protect intellectual property.
When you host your software inhouse, youre in charge of where
to store your own data, how to
protect it, and how to restore lost
or corrupted files. Keep in mind
that ownership doesnt guarantee that your IP wont be threatened, that most subscription
software rental services allow
you to store your data in-house,
and that some would argue that data security provided for cloudbased software is better than what many companies could establish on their own. But with ownership, you control the situation
100%, greatly reducing concerns about who can access it. Especially
for companies in the manufacturing industry, where proprietary
designs are the lifeblood, that single reason is enough to opt for
software ownership.
Direct control over software use. One of the greatest benefits
of software ownership, this flexibility means you can customize
your software and integrate it with other tools according to your
unique needs. And whereas most subscription-based software
updates automatically for the user, according to the developers
terms, perpetually licensed software updates only when youre
ready to make the move.
Direct control over system stability. System crashes (and response
to them) also are yours to control. The people who can fix a problem are working for you alone and can keep you directly apprised
of progress. Youll never have to worry about working around

CAD Software: The Benefits of Ownership4

TurboCAD Pro: Powerful 2D/3D Design with Versatile Licensing Options

urboCAD is a popular line of

2D/3D general-purpose CAD
software for Microsoft Windows
and Apple OS, developed by the
TurboCAD Design Group of IMSI/
Design. With more than three
million products distributed since
1988, the company is a global
leader in retail CAD and a pioneer
in developing mobile solutions for
architecture and construction.
TurboCAD Pro is a collection of
professional-grade, integrated
tools to create, modify, present,
and document designs. TurboCAD Pro for Windows, one of
six versions in the TurboCAD for
Windows line, is available by perpetual license ($1,495) as well as
annual subscription ($399).
TurboCAD Pro is well known for
its drafting palette, ACIS modeling, DWG compatibility, photorealistic rendering, and extensive
file support. The long list of
features includes the following
highlights:
Professional-grade performance.
TurboCAD Pro 64-bit can load,
process, and render files of nearly The extensive list of features in TurboCAD Pro includes tools for advanced
any size, tapping the GPU for
3D mechanical design (shown at top) and photorealistic rendering (bottom).
smooth graphics performance.
Multithreading takes advantage
of multicore processors for lightning fast calculations.
Download a free trial of TurboCAD Pro
File interoperability. TurboCAD Pro supports 3D
model export to 3D PDF, and users can open, insert,
or embed as many as 35 file formats and export up to
28, including DWG, DXF, SKP, 3DM, 3DS, IGES, STEP,
OBJ, and many more.
Fast drafting and detailing. Create views and viewports of any size and shape, and access extensive
paper space and printing capabilities, a multiselect
drawing tool, marker and schedule tools, leaders,
multileaders, dimension tools, and symbols content.
3D printing optimization. TurboCAD Pro reads and
writes the industry-standard STL file format.
Rendering and visualization. The Redway3d Redsdk
drawing and rendering engine draws on GPU power
to speed design work and help create stunning
artistic renderings and photorealistic presentations. A
complete library of materials and a materials editor

let you define physically accurate materials, including

reflective surfaces with ray tracing and radiosity.
Architectural tools. TurboCAD Pro comes with a suite
of architectural tools that accelerate design and
drafting productivity, including Wall, Window, Door,
Roof, Stair, Marker, Schedule, and Terrains. Architectural objects are AutoCAD Architecturecompatible,
so DWG models that have ACA extensions may be
read, modified, and documented as needed.
Mechanical CAD tools. Tools for 3D drawing and
editing, surface modeling, and powerful ACIS solid
modeling make TurboCAD Pro ideal for single part
and small assembly mechanical designs.
And more. TurboCAD Pro also offers powerful parametric constraints, annotation, symbols and parts
libraries, extensive xref support, a software developers kit (SDK), and much more.

CAD Software: The Benefits of Ownership5

server outages or other downtime imposed by the software

developer all things that could impede your ability to meet critical project deadlines if left in the hands of cloud-based software
provider.
No Internet required. Perpetually licensed software doesnt require
Internet access to operate and therefore isnt subject to the poor
connections or outages that can affect cloud-based software. The
availability and performance of your software are as stable as the
platform you build to support it.
Indefinite use. You can use perpetually licensed software as long as
you wish, even in the event of a financial crisis that could impede
subscription payments. Although the software developer might
stop providing updates and technical support after a number of
years, you can continue to rely on the product indefinitely, provided your hardware can support it. Conversely, a lapsed software
subscription means you wont be able to open and edit your CAD
files going forward.

Users with a very

stable setup allowing
them to plan ahead
the number of
licenses or the set
of features needed
in the near future
can afford to give
up the flexibility of
the rental option. For
those users, perpetual
licenses can be the
most cost-effective
solution.
Franco Folini
President & Founder
Novedge

When Ownership is Best

How do you determine which licensing option is best for you?
Following are some obvious signs that your business might be best
served by software that is perpetually licensed.
Your design workload is stable. If your design work and the size of
your design team changes as your project load ebbs and flows, or if
your company is growing unpredictably, there are clear benefits to
subscription licenses that you can easily add or drop as needed. If
not, you might be better served by perpetual licenses. Franco Folini,
president and founder of CAD software reseller Novedge, says,
Users with a very stable setup allowing them to plan ahead the
number of licenses or the set of features needed in the near future
can afford to give up the flexibility of the rental option. For those
users, perpetual licenses can be the most cost-effective solution.
Your company has a very strict internal software certification
process. Such companies can have some problems in switching to
rental licenses, Folini says, and are best served by perpetual licenses
that have a release cycle of one year or longer. Even if they adopt
the rental licensing model, they might not be able to take advantage of the frequent software upgrades due to the time-consuming
certification process.
Your software is significantly customized and/or integrated. If
your organization has invested more than a little time and effort
to modify your design software to support your unique workflow,
or if the software is integrated with other tools, you likely wont be
able to achieve the same with a hosted solution nor would you
be able to control updates to the software that could undermine
your in-house setup.
Your workflow is compute-intensive. Design and engineering
groups that carry out computationally (CPU) or graphically (GPU)
intense work such as complex design simulation, analysis, or rendering often experience network latency via the cloud.

CAD Software: The Benefits of Ownership6

Youre not ready to take on increased IT and cost management

demands. Cloud-based computing requires a new level of IT expertise and cost management. The transition requires significant upfront investment that many companies are not ready to take on.
Youre simply not ready to trust the rental option. Some users
prefer to own the license because they have purchased perpetual
licenses for years, Folini observes. They dont yet feel comfortable
with the rental option. And lets face it: Subscription is still a new
concept with a relatively short track record. Although you might
not balk at software rental for personal use, youre just not ready
to trust it for business. We are seeing the same resistance we were
observing when the delivery of many software products switched
from a physical DVD to the simpler download link, adds Folini. If
this is how you feel, dont force the move. The rental option will be
there if and when you feel more secure about it.

Cost of Ownership vs. Subscription

Aside from data security, cost is likely to be an organizations greatest concern when wrestling with software licensing options. Using
IMSI/Designs TurboCAD Pro as an example, we find that software
ownership has the financial advantage over rental when the user
upgrades every four years or more. The longer you wait between
upgrades, the more youll save year to year with ownership.

Software Costs Per Year: Rent vs. Own

License type
and cost

Annual subscription
$400 per year

Perpetual license*
$1,495 one-time purchase
The table above compares
own-vs.-rent software costs over
time, using TurboCAD Pro 2016 for
Windows as an example.
*Calculations show that a
TurboCAD perpetual license held
for four years works out to $374
per year slightly less than the
annual subscription payment.

Cost per year when maintaining original license for:

two years

three years

four years

five years

$400

$400

$400

$400

$747

$498

$374

$299

Note that if your software developer offers a maintenance option

with perpetual license purchase and if you opt for it youll
need to factor that annual cost into the overall cost of ownership.
As well, you should factor in any extra cost of hardware and staff
needed to support an in-house setup.

Conclusion
Choosing how to license your CAD software shouldnt be taken
lightly. If your design tools are critical to your business, so are its
security, stability, and cost. Dont allow your software vendor to
force you into a licensing option thats not in the best interest of
your business in fact, consider the value of opting for a CAD
software developer that offers both permanent licenses and rental
options. That way, you can adapt to changing business needs
relatively easily and affordably while maintaining a software foundation thats within your control and accessible long-term.

CAD Software: The Benefits of Ownership7

Be Wary of Vendor Lock-in

he perceived ability to easily move on and off a

software rental program doesnt play out in every
scenario. Be wary of the idea to rent CAD software to
try it out, a suggestion that seems practical on the
surface especially if you abandon your traditional
software in the process. Dropping the tool if it proves
unsatisfactory can be costly.
In a CFO article, Is a Perpetual Software License Such
a Bad Thing?, author David Rosenbaum interviews
Kerry Kane, principal at Software Contract Solutions,
a consultancy that helps companies negotiate software deals. Kane states, Companies underestimate
switching costs in the subscription model. Theyll
pay a premium for the perceived ability to drop the
subscription if theyre not happy, but in reality, once
theyve developed data, process, and infrastructure
tied to the product, they cant switch in practice
as easily as they can in principle. Do you plan to
integrate the software with other applications? The
greater the number of applications you have tied to

Click to
download
your free trial
version of
TurboCAD
Pro.

the rented application, the more difficult and costly it

will be to migrate away from it.
When an organization reaches this state of vendor
lock-in, it also means the business depends on its
software vendor, literally day-to-day, for its livelihood. Subscription software that resides on the cloud
could fail at any time, for any length of time or
the developer could go out of business leaving
customers without software access with potentially
zero notice.
Kane goes on to say that before signing on with a
cloud service, organizations should determine how
critical the application is to business processes as well
as the consequences of moving off the tool. If you do
plan to customize the software or integrate it with
other tools, a perpetual license is your best bet. If
you can take the application the way the provider
gives it to you, thats a great cloud application. If its
something youll want to build on, you really have
to think hard about what happens if the honeymoon
with your vendor ends.

Meanwhile, the growth of subscription software will likely prove

beneficial for software renters as well as owners over time. The
transition from perpetual licenses to rental licenses implies also
a transition from product to service, Folini explains. This is a
very important transition that will have huge implications for the
software products. Software manufacturers will be relieved from
the pressure to constantly add new features just to feed their
marketing department and to justify the cost of the most recent
upgrade for the existing users. They will focus more and more on
core features that will have a big positive impact on designers
productivity.
NANCY SPURLING JOHNSON is content director at Longitude Media, publisher of
Cadalyst, the leading publication covering computer-aided design and related
software and hardware technologies for the AEC, civil engineering, and manu
facturing markets.
TurboCAD, Adobe, Creative Cloud, Autodesk, ACIS, and all other trademarks
mentioned herein are property of their respective owners.
2016 Longitude Media, LLC. Reproduction in whole or in part is strictly prohibited without written permission of the publisher.