With the introduction of Adobe Creative Cloud, deciding which licensing path to take is now more complicated than ever before. In this post I will look at some of the options and how they breakdown in terms of cost and flexability.
With Creative Cloud, Adobe has really opened up the creative tools market. As I will detail below, using even a few Adobe tools will make Creative Cloud a better value than traditional licensing. It also represents a great strategy for Adobe to get Premiere Pro out to as many video editors as possible.
Understand Your Needs
The path to the best answer for you and your business starts with having a clear understanding of what you need to be able to do. If you only need Premiere Pro, then there is not a direct return on investment of having an After Effects or a Photoshop license.
Another important consideration is how long you plan to use the software. The CS6 upgrade pricing is such that there is not a penalty to skipping a few versions prior to upgrading. While there is no guarantee that Adobe will continue with their current pricing strategy for new versions of their applications, historically they have and will likely continue to do so as they compete with Apple, Autodesk and Avid.
CS6 Pricing
| Premiere Pro | After Effects | Photoshop Extended | Illustrator | Production Premium | Master Suite | Creative Cloud |
|---|---|---|---|---|---|---|
| $799 Full | $999 Full | $999 Full | $599 Full | $1899 Full | $2599 Full | $74.99/mo. Month to Month |
| $299 Upgrade from Adobe Premiere Pro CS5, CS4, CS3, 2.x, or 1.x; Adobe Premiere; or Encore DVD 2.0 | $349 Upgrade from CS3, CS4, or CS5 | $399 Upgrade from CS3, CS4, or CS5 | $249 Upgrade from CS3, CS4, or CS5 | $949 Upgrade from CS4 or 3.x | $1399 Upgrade CS4 or 3.x | $49.99/mo. 1 Year Contract |
| $749 Upgrade from CS5 | $1049 Upgrade from CS5 | $29.99/mo. 1 Year Contract Upgrade From CS3 | ||||
| $149 Upgrade from CS5.5 | $175 Upgrade from CS5.5 | $375 Upgrade from CS5.5 | $525 Upgrade from CS5.5 |
The table above shows the pricing for Premiere Pro, After Effects, the Production Premium Suite, the Master Suite and Creative Cloud. Premiere Pro and After Effects are the two applications that are of most interest to video editors. With the suites, the Production Premium Suite is the smallest of the to offer both Premiere Pro and After Effects. The Master Suite, included as its applications are made available with a Creative Cloud subscription, builds on the Production Premium Suite by adding applications for web design (Flash, Dreamweaver, Fireworks) and print design (InDesign).
No Penalty for Skipping a Version
The current upgrade pricing within the products does not penalize customers for skipping a version and upgrading later. For example, upgrading Premiere Pro from CS5 to CS6 will cost $299 versus $149 for upgrading from CS5.5 to CS6. Put another way, Adobe is not currently providing any incentive for customers to upgrade each year, but then again, they aren't bound to continue with this pricing strategy for future releases either.
Scenarios
In order to decide what makes the most sense for you to license the needed Adobe software, we'll consider a some different scenarios and see how the costs break down. For the purposes of these scenarios, we will assume that the purchase decision is to be taken today - ie. we're at the beginning and not midway through the product lifecycle.
Premiere Pro Is The One Application For You
You eat, sleep and otherwise live in your NLE and have no need to venture into other areas of the post production world. You're probably an independent editor relying on other independents to handle tasks your NLE is not able to take on itself.
Licensing one of the CS6 Suites does not make any sense if you only need Premiere Pro. With that in mind, here are your options.
| Option | Year 1 | Year 2 | Year 3 | Total |
|---|---|---|---|---|
| Upgrade from CS 5.5 for $149. | $149.00 | $0.00 | $0.00 | $149.00 |
| Upgrade from Adobe Premiere Pro CS5, CS4, CS3, 2.x, or 1.x; Adobe Premiere; or Encore DVD 2.0 for $299. | $299.00 | $0.00 | $0.00 | $299.00 |
| Buy a full license for $799. | $799.00 | $0.00 | $0.00 | $799.00 |
| Upgrade to a 1 year contract for Creative Cloud and pay $29.99/month for the first year. | $359.88 | $599.88 | $599.88 | $1559.64 |
| Sign a 1 year contract for Creative Cloud and pay $49.99/month. | $599.88 | $599.88 | $599.88 | $1799.64 |
| Use Creative Cloud on a month to month basis paying $74.99/month. | $899.88 | $899.88 | $899.88 | $2699.64 |
Upgrade from CS 5.5 for $149.
Pros: Cheapest over time.
Cons: Costs are front loaded and may need to be planned for to avoid cash flow problems.
If you can make a business case for the upgrade and you have a CS5.5 license, then this is your best bet to get CS6.
Upgrade from Adobe Premiere Pro CS5, CS4, CS3, 2.x, or 1.x; Adobe Premiere; or Encore DVD 2.0 for $299.
Pros: Cheapest over time if you do not have CS5.5
Cons: Costs are front loaded and may need to be planned for to avoid cash flow problems.
The business case to upgrade gets easier as the feature gap between your existing license and CS6 gets wider. If the case can be made, then this is your best option.
Buy a full license for $799.
Pros: Cheapest over time if you do not qualify for an upgrade.
Cons: Costs are front loaded and may need to be planned for to avoid cash flow problems.
If you've got a stable business and don't need other tools from Adobe, this approach is cheap and as long as there isn't a penalty for skipping versions you can upgrade when something compelling comes along. While that bumps you over to option 2, you're not committing to until later and until then have the least sunk costs if you decide to switch to a competitors offering.
Upgrade to a 1 year contract for Creative Cloud and pay $29.99/month for the first year.
Pros: Best for cash flow during the first year.
Cons: More expensive than either straight upgrade.
If you qualify for an upgrade, this is really the worst of your options. If you have a CS5.5 license, this option will cost you more after only 5 months and an older upgradeable license will do so during month 13.
Sign a 1 year contract for Creative Cloud and pay $49.99/month.
Pros: Easy on cash flow and the cheapest if you won't need a license past the first year and do not qualify for an upgrade.
Cons: Far too expensive if you just need Premiere Pro and end up using it for more than a year.
If all you need is Premiere Pro, this option is probably not a good deal. While the cost during the first year is slightly less than an outright license purchase, the two options are equal a mere four mounths later after which the outright purchase is a better deal. If you have very concrete plans to switch to another product within 16 months and are just stopping by then this option makes sense, but there probably are not a lot of you planning to do so and many who do will end up needing Premiere Pro for more than 16 months. The one scenario where this may make sense is if you have steady business but cash flow is really tight. Even then, you could get a loan to cover the purchase cost that would have similar cash flow and cost less.
Use Creative Cloud on a month to month basis paying $74.99/month.
Pros: Flexibility to match your business if you don't need Premiere Pro every month.
Cons: Could end up paying a lot for that flexibility.
As with the other subscription option, if all you need is Premiere Pro, this option is probably not a good deal. It becomes more expensive than an outright purchase after 11 months and than the 1-year contract subscription after 8 months. That being the case, this option is a good way for you to try out Premiere Pro beyond the 30-day trial period without having to commit to a full license. If you decide to do that, just make sure to make a descision as soon as possible to get licensed using one of the other options or to use another tool.
Like Peanut Butter And Jelly, Premiere Pro And After Effects Belong Together
If you need to do motion graphics or compositing as well editing, then you will want After Effects. With the need to license both products, the value proposition changes and the CS6 Suites need to be considered.
For brevity I have omitted some of the upgrade scenarios and left what should be the most common ones to be considered.
| Option | Year 1 | Year 2 | Year 3 | Total |
|---|---|---|---|---|
| Upgrade both from CS 5.5 for $324. | $324.00 | $0.00 | $0.00 | $324.00 |
| Upgrade both from CS3, CS4, or CS5 for $648. | $648.00 | $0.00 | $0.00 | $648.00 |
| Buy Premiere Pro and upgrade After Effects from CS5.5 for $974. | $974.00 | $0.00 | $0.00 | $974.00 |
| Buy Premiere Pro and upgrade After Effects from CS3, CS4, or CS5 for $1148. | $1148.00 | $0.00 | $0.00 | $1148.00 |
| Upgrade to a 1 year contract for Creative Cloud and pay $29.99/month for the first year. | $359.88 | $599.88 | $599.88 | $1559.64 |
| Buy both for $1798. | $1798.00 | $0.00 | $0.00 | $1798.00 |
| Sign a 1 year contract for Creative Cloud and pay $49.99/month. | $599.88 | $599.88 | $599.88 | $1799.64 |
| Buy Production Premium for $1899. | $1899.00 | $0.00 | $0.00 | $1899.00 |
| Buy Master Suite for $2599. | $2599.00 | $0.00 | $0.00 | $2599.00 |
| Use Creative Cloud on a month to month basis paying $74.99/month. | $899.88 | $899.88 | $899.88 | $2699.64 |
Upgrade both from CS 5.5 for $324.
Pros: Cheapest option if you qualify.
Cons: Additional cost for further upgrades.
Even if you add in upgrade costs to maintain feature parity with a Creative Cloud subscription, this is still a better deal than subscribing to Creative Cloud.
Upgrade both from CS3, CS4, or CS5 for $648.
Pros: Cheapest option if you do not qualify for the CS5.5 upgrade.
Cons: Additional cost for further upgrades.
Again, even if you add in upgrade costs to maintain feature parity with a Creative Cloud subscription, this is still a better deal than subscribing to Creative Cloud.
Buy Premiere Pro and upgrade After Effects from CS5.5 for $974.
Pros: Cheapest option if you do not own Premiere Pro and qualify.
Cons: Additional cost for further upgrades.
Yet again, even if you add in upgrade costs to maintain feature parity with a Creative Cloud subscription, this is still a better deal than subscribing to Creative Cloud.
Buy Premiere Pro and upgrade After Effects from CS3, CS4, or CS5 for $1148.
Pros: Possibly the cheapest option in the long term if you do not own Premiere Pro and do not qualify for the CS5.5 upgrade.
Cons: Initially more expensive then a Creative Cloud subscription. Additional cost for furtner upgrades.
This option is not as clear cut as the others, but requires a longer timeframe than 3 years to be seen clearly.
| Option | Year 1 Total | Year 2 Total | Year 3 Total | Year 4 Total | Year 5 Total |
|---|---|---|---|---|---|
| Buy Premiere Pro and upgrade After Effects from CS3, CS4, or CS5 for $1148 with Annual Upgrades | $1148.00 | $1472.00 | $1796.00 | $2120.00 | $2444.00 |
| Sign a 1 year contract for Creative Cloud and pay $49.99/month. | $599.88 | $1199.76 | $1799.64 | $2399.52 | $2999.40 |
For the first two years, the Creative Cloud subscription is the better option, but beyond that it is cheaper to just continue upgrading your Premiere Pro and After Effects licenses.
Unfortunately, there are some big assumptions that need to be made for this to remain true: * You have to be able to make it your business work without any of the other apps that are available in Creative Cloud for at least 3 years. Possible, but hard to predict that far into the future. * Adobe's upgrade pricing needs to remain as it is for CS6. * Adobe's pricing for Creative Cloud remains the same.
If you can get by for a 4 or more years without upgrading then it makes sense to take this option. To me, that seems like a long stretch to try to get by in a highly comptetitive market that also front loads the cost. I would expect that over that time Adobe and others will make significant improvements to their tools and that not upgrading for such an extended period would put you in a competitive disadvantage.
In regards to relative pricing of Creative Cloud versus traditional licenses, I suspect that over time Adobe will want to migrate users to Creative Cloud and away from traditional licenses to smooth out their revenue stream. This could mean that upgrades are only made available via Creative Cloud or that the pricing changes to make traditional upgrades relatively more expensive. With this in mind, I would choose the Creative Cloud subscription.
Upgrade to a 1 year contract for Creative Cloud and pay $29.99/month for the first year.
Pros: Cheapest for first 11 months and easiest on cash flow.
Cons: Potentially more expensive over the long term than upgrading.
See the analysis for the "Buy Premiere Pro and upgrade After Effects from CS3, CS4, or CS5" option. This sweetens the deal even further by shaving some cash of the first year.
Buy both for $1798.
Pros: None.
Cons: Front loads 3 years of Creative Cloud and doesn't include upgrades.
There is not a good business case for taking this option.
Sign a 1 year contract for Creative Cloud and pay $49.99/month.
Pros: Easy on cash flow. Includes upgrades.
Cons: None.
See the analysis for the "Buy Premiere Pro and upgrade After Effects from CS3, CS4, or CS5" option.
Buy Production Premium for $1899
Pros: None.
Cons: Front loads over 3 years of Creative Cloud and doesn't include upgrades.
There is not a good business case for taking this option.
Buy Master Suite for $2599
Pros: None.
Cons: Front loads over 4 years of Creative Cloud and doesn't include upgrades.
There is not a good business case for taking this option.
Use Creative Cloud on a month to month basis paying $74.99/month.
Pros: No committment.
Cons: Most expensive option if you need the apps more than planned.
If you are certain you will only need the apps for less than 8 months of the year, this option is less expensive than the $49.99/mo. year contract subscription.
Need More Than Premiere Pro and After Effects?
Looking at the progression from a minimal toolset consisting of Premiere Pro itself to one of Premiere Pro and After Effects, we can see the value shift from traditional licensing to Creative Cloud. In order to underscore this trend, I will present some options and their costs if we add Photoshop and Illustrator into the mix.
With the number of products being considered, I am going to omit the purchase some and upgrade others as well as mixed upgrade (some on CS5.5 and others on CS5) scenarios for brevity.
| Option | Year 1 | Year 2 | Year 3 | Total |
|---|---|---|---|---|
| Upgrade from most recent pre-CS6 versions for $972. | $972.00 | $0.00 | $0.00 | $972.00 |
| Upgrade from CS5 versions for $1296. | $1296.00 | $0.00 | $0.00 | $1296.00 |
| Upgrade to a 1 year contract for Creative Cloud and pay $29.99/month for the first year. | $359.88 | $599.88 | $599.88 | $1559.64 |
| Sign a 1 year contract for Creative Cloud and pay $49.99/month. | $599.88 | $599.88 | $599.88 | $1799.64 |
| Buy Production Premium for $1899. | $1899.00 | $0.00 | $0.00 | $1899.00 |
| Buy Master Suite for $2599. | $2599.00 | $0.00 | $0.00 | $2599.00 |
| Use Creative Cloud on a month to month basis paying $74.99/month. | $899.88 | $899.88 | $899.88 | $2699.64 |
| Buy all for $3396. | $3396.00 | $0.00 | $0.00 | $3396.00 |
Upgrade from most recent pre-CS6 versions for $972.
Pros: None.
Cons: Front loads over 2 years of Creative Cloud and doesn't include upgrades.
You qualify for the $29.99/mo. first year on Creative Cloud which will keep you upgraded to the latest version. There is no reason to buy upgrade licenses.
Upgrade from CS5 versions for $1296.
Pros: None.
Cons: Front loads over 2 years of Creative Cloud and doesn't include upgrades.
As with the previous option, you qualify for the $29.99/mo. first year on Creative Cloud which will keep you upgraded to the latest version. There is no reason to buy upgrade licenses.
Upgrade to a 1 year contract for Creative Cloud and pay $29.99/month for the first year.
Pros: Cheapest way to stay up to date.
Cons: None.
If you qualify for a Creative Cloud upgrade, then this is the best option. You will always have the latest version of the software and will be saving money as compared to staying upgraded using traditional licenses.
Sign a 1 year contract for Creative Cloud and pay $49.99/month.
Pros: Cheapest way to stay up to date if you do not qualify for a Creative Cloud upgrade.
Cons: None.
If you do not qualify for a Creative Cloud upgrade, then this is the best option. You will always have the latest version of the software and will be saving money as compared to staying upgraded using traditional licenses.
Buy Production Premium for $1899.
Pros: None.
Cons: Front loads over 3 years of Creative Cloud and doesn't include upgrades.
There is not a good business case for taking this option.
Buy Master Suite for $2599
Pros: None.
Cons: Front loads over 4 years of Creative Cloud and doesn't include upgrades.
There is not a good business case for taking this option.
Use Creative Cloud on a month to month basis paying $74.99/month.
Pros: No committment.
Cons: Most expensive option if you need the apps more than planned.
If you are certain you will only need the apps for less than 8 months of the year, this option is less expensive than the $49.99/mo. year contract subscription.
Buy all for $3396.
Pros: None.
Cons: Most expensive option, does not include upgrades.
There is not a good business case for taking this option.
Bottom Line
- If you only need Premiere Pro, then you are best served by upgrading your existing license or buying a full license for Premiere Pro.
- If you need both Premiere Pro and After Effects and qualify for upgrades on each of them, then upgrade your existing licenses.
- If you need both Premiere Pro and After Effects and you qualify for an upgrade on After Effects but not on Premiere Pro, then Creative Cloud is the best option, if not the cheapest over time.
- If you need both Premiere Pro and After Effects and do not qualify for an upgrade on either, then Creative Cloud is the best option.
- If you need Premiere Pro, After Effects and any other Adobe apps, then Creative Cloud is the best option.
- There is no good reason to buy a license for either the Production Premium Suite or the Master Suite now that Creative Cloud is available.
Postscript: Creative Cloud
For many Adobe users, Creative Cloud represents an incredible value. Many video editors will already use After Effects, Photoshop and Illustrator for motion graphics. Creative Cloud enables these video editors to always have the latest version of these apps for less than the cost of upgrading. More interesting is that these editors will essentially be getting Premiere Pro for free, thereby making it very easy to try it out and possibly switch when the time comes.
It will be interesting to see how other NLE vendors respond to Adobe. To the extent that Premiere Pro is a substitute for their offerings, they will likely lose market share. The advantage is really with Adobe for now as Premiere Pro does not need to be better than competitor's offerings, rather Premiere Pro only needs to be good enough.
