In a recent poll here on Epic Edits, I asked How Much Would You Pay for Photoshop? It’s no surprise that the results indicate that Photoshop is priced way above a majority of the market willing to pay. This poll spawned from a previous Photoshop poll that told us 60% of Photoshop Users are Pirates! Many of the responses to that study mentioned the outrageous price Adobe charges for Photoshop and Photoshop upgrades.

The poll at hand used the basic Photoshop upgrade price as the basis for the question (which is $300 at first, then dropping to $200). Nearly 340 people responded to the poll, and the numbers came out with an interesting consistency. Click here for a capture of the raw poll numbers at the time this article was written. What you see below in the blue bar chart are numbers that have had some math applied to them in order to arrive at the green area graph (I’ll explain below).

DISCLAIMER: This is an editorial review of a very open poll conducted on this website. I’m not claiming that any of this is 100% true or trustworthy — it’s just an interesting concept and I’m only going by the numbers I’ve collected.

Photoshop Price Poll Results

BREAKING DOWN THE NUMBERS

So the chart basically says that if Adobe decreases the price of Photoshop to 1/3 the current cost, they could increase their revenue by over 3 times! This is due to the fact that over 10 times the number of Photoshop users are willing to pay that lower price. More sales at a lower price can equal higher revenues. Let me explain the chart a little further.

The numbers along the bottom (x-axis) reflect the cost of a Photoshop upgrade, and they’re the same numbers we used in the poll. The numbers on the right side of the chart (y-axis for the blue chart) represent the percentage of Photoshop users willing to pay at those given price points. The numbers on the left side of the chart (y-axis for the green chart) represent the possible revenue from 1000 Photoshop users (which is a random number for generating real numbers on the chart).

The blue chart shows the percentage of Photoshop users that are willing to pay at each price point. Notice that this chart looks different than the raw numbers in the poll. This is due to the assumption that users willing to pay $300 will also be willing to pay $250, $200, $150, $100, $50, and $0. But users willing to pay $200 will not be willing to pay $300. So you can see that free Photoshop has a 100% value (who wouldn’t take it for free, right?). This blue chart is derived directly from the poll numbers.

The green chart shows how much revenue Adobe could make per 1000 Photoshop users. This chart is based on the blue chart values, the price points, and the semi-random value of 1000 users. So if 75% of our 1000 users are willing to pay $100 for the Photoshop upgrade, this means that 750 people are going to drop $100 on the software resulting in 750 x $100 = $75,000.

WHAT’S ADOBE THINKING?

I’m not claiming that I’m smarter or more business savvy than the folks at Adobe — I’m quite sure they know what they’re doing. But we all know that Photoshop is one of the most heavily pirated pieces of software on the market, and most of us think that it’s overpriced. I’m sure Adobe is aware of these things as well.

So why be stubborn with the price? If you could potentially increase your revenue by 3 fold just by lowering the price, why wouldn’t you?

Would dropping the price of the software somehow “cheapen” it because of perceived value? I sure don’t think so. Photoshop is a verb for crying out loud! “i.e. That photo is totally Photoshopped.” When your product name turns into a verb, it’s a good sign that you own the market. A cheaper price tag wouldn’t correlate to a cheaper quality.

IS LIGHTROOM THE ANSWER?

I find it really interesting that our poll indicates that the most revenue can be produced by a $100 price point for the software upgrade. Why so interesting? Because that’s exactly the price of the Lightroom upgrade. Is Adobe well aware of this market trend and they’re using it to set the price of Lightroom? Sure, it offers fewer features than Photoshop, but I’m guessing that people would still pay for it if the price were $150 or $200. If this were the case, they’d probably just be pushing more people to pirate the software rather than buy it (as is the case with Photoshop).

I’m actually aware of several photographers who pirated Photoshop in the past, but purchased Lightroom. And while I know that Lightroom will be pirated, I’m guess that it won’t be as much as Photoshop now that the upgrade price has hit the market.

FINAL THOUGHTS

While Lightroom is certainly a cheaper alternative to Photoshop, they’re different pieces of software. They each have their own use. It’s hard to say if the numbers presented in this study would actually reflect purchasing habits of Photoshop users, given a lower price. But I think the trend would hold true — lower price would result in higher revenue for Adobe.

I’d love to see Photoshop offered at $100, but I don’t think that’s going to happen any time soon. What do you guys think: will we ever see lower prices on Photoshop?

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I tend to always be skeptical of laffer curve arguments. also, i think adobe is smart enough to have thought about this themselves. my thought? its about scalability in their product line. they realize that they can sell elements to amateurs for a couple hundred, and photoshop for significantly more. its likely not in their best interest, from a profit perspective, to limit themselves to a single product.

basically, no, i do not think photoshop prices will ever fall. like i said, adobe likely has a large team of people that have done more thorough market research to make management decisions.

July 31, 2008 10:32 pm

this is certainly interesting research, but…
1. your sample size of 340 users is too small compared to the user base to draw the conclusion you arrived at

2. While this is an assumption on my part, I’m guessing those who participated in the poll use PS for photographic applications, however there are at least 4 other major markets who use the tool in different ways.

3. Lightroom isn’t exactly an alternative to PS

4. Its not about “features” its about workflow, which is vastly different depending upon the kind of work you’re doing (i.e. game development, broadcast design, photography, web design)

July 31, 2008 10:52 pm

Very interesting analysis Brian, especially given the relationship you have had with Adobe recently. My only question is why did you ask about the *upgrade* cost? You can only upgrade if you own a legal copy, and your assumption was that most of the people voting on the poll own pirate copies. The full purchase price is FAR higher than even the asked for upgrade price, let alone the popular voted $100 upgrade price.

I also wonder if people may have been confused by the poll and thought they were voting on what the full price should be, especially when the title of the poll was “How Much Would You Pay for Photoshop?” not “How Much Would You Pay To Upgrade Your Legally Owned Copy of Photoshop?”.

July 31, 2008 11:01 pm

I think a price point of about $200 would make the full version of photoshop more feasable for the masses… I do own a legal copy, though I got it at the academic price (as part of the full CS3 Design Studio).

July 31, 2008 11:26 pm

@Jonathan I’m in agreement that Adobe has run this thought through their head, and I’m sure they do have a good reason for charging the price they do. Elements is a funny topic too. Sure, it’s very affordable, but it’s kinda like a gateway drug for photographers. It’s easy to outgrow, and the next step is pirating Photoshop.

@Gary Great points! 1) I do what I can with what I’ve got. But I also watched the poll closely as the numbers rose to their current values and the trend was very steady right from the start. I wouldn’t expect any drastically different results even if we had a few thousand votes. 2) Yes, we’re photographers here. Again, I do what I can with what I’ve got — I can’t reach into those other user segments because I don’t have the resources to do so. 3) It’s not, but it’s pretty close for most photographers. 4) I agree.

@Neil I asked about the upgrade cost because that’s the cost that you can expect to pay over the long term. Once you foot the bill for the first legal copy, you’re just looking at upgrade costs assuming you keep up with it. I can only assume that people read the text above the poll and the title of the poll right above the voting buttons. Though based on recent articles, I’m sure that more than one person didn’t read before taking action.

@Sarah Yeah, academic prices throw a whole other twist into all of this — along with those who get legal copies of the software via their employer.

July 31, 2008 11:38 pm

A few notes:
1. Academic prices are great, but they are not upgradeable, so that’s changes the pricing if you want
to keep up to date.
2. Copies via employers are usually the cheapest to get, as companies with large user base get
pricing down to a fraction of the retail cost, and their employers usually get almost free copies while
they work there.
3. For amateur photographers, Lightroom is very good (I don’t know how I lived without it…) and I plan to upgrade.
4. Once you used Photoshop, Elements is like going back to kindergarten, it’s fun but you are very
limited.

I wonder how many photographer would think about buying Photoshop eventually (e.g. within less than 5 years of using Elements or a pirated Photoshop copy).

July 31, 2008 11:53 pm

First, Adobe products are great. However, the price is a complete turn off. I will not pay the full price of Photoshop when alternatives like GIMP will achieve 90-99% of what PS does – albeit with a few extra steps. Price is the reason why I have completely sworn off the Adobe products including Acrobat. Many cheaper alternatives.

Elements is a JOKE on photographers even amateurs.

Lightroom is NOT a PS substitute so comparison does not work.

July 31, 2008 11:55 pm


Many years ago someone I know worked for a Really Big Software firm that came out with one of the first graphics packages that sold a lot. I heard from him about the internal discussions of how to price the product – and the story was that they could have sold it at a huge range of price points. They could put it in a really big package with large fancy manuals and charge $400 for it… or they could take the very same software and package it more simply and sell it for $40/ copy. In the end, either was viable since their costs didn’t vary much – sell a bunch at a low price or sell fewer at the high price point.

Dan

August 1, 2008 12:58 am

As a guy from Germany i’d love to see Adobe not to charge more in our country than the official american price converted to EURO currency…. why should Europeans have to pay more for the same piece of software?

August 1, 2008 1:43 am

Bibble will save us all!
Eyes open for Bibble’s version 5 workflow software and RAW converter when it comes out.
They’ll give punters a free upgrade to v.5 if they buy the current 4.10.1
LR2 is over double the price! (Ok you get a discount if you’re upgrading)
I’m expecting Bibble 5 to be a little less clunky than earlier versions.
Just watch. Proprietary workflow software/RAW converters are evolving quickly as well (e.g. Nikon’s Capture NX2), to the point that their functionality will eventually – if it hasn’t already – obviate such a significant proportion of Photoshop’s specs that economically challenged amateur photographers, like me, could comfortably live without Photoshop altogether.

August 1, 2008 2:44 am

Well, as others have mentioned, those results are relative to the small amount of people who have participated in this poll.. out in the real world, Photoshop has a much broader market than hobby or even semi-pro / pro photographers. I worked in the electronic gaming sector for a decade.. just in game companies alone, the amount of copies (legal) from adobe is massive (granted, in situations like this, companies get a break on price per unit due to bulk licensing).. but there are many smalller companies across a large spectrum of arts.. ranging from gaming companies to graphic artists and website developers.. even for these guys (at full price initially) it is worth it (much like a pro photographer paying big bucks for high end lenses and camera bodies and etc…)..

So realistically, you shouldn’t claim in your initial Lead Story intro that ‘It’s no surprise that the results indicate that Photoshop is priced way above a majority of the [market] willing to pay. ‘.. but then again, you also claimed that ‘I’m not claiming that any of this is 100% true or trustworthy — it’s just an interesting concept and I’m only going by the numbers I’ve collected.’ , so I’ll go easy on you this time and I won’t burn you at the stake ;)

Cheers,

NRG

August 1, 2008 4:47 am

While the numbers do not represent the entire Photoshop user base, they do represent the types of people that visit this site as well as my own. To me, that’s what makes a poll like this interesting. I also look at what Adobe is trying to do with Lightroom as a move to cater to this market.

Look at Microsoft Office, its so bloated and expensive now that it is actually hard to justify the price. When you take a yearly Office license and add a Microsoft Exchange license, you are in for about $100 per employee per year. Many companies are switching to Google Apps, at $50 per year you have tools that are “good enough” plus many things you dont get easily from Microsoft like real-time collaboration.

Photoshop has become too large to be the tool that every photographer needs, and Lightroom is a fraction of the cost and is “good enough” for a huge number of people. Lightroom 2.0 gives you even more power without having to go into Photoshop. I would certainly like a lower priced version with a ton of features that could be removed. I also would like Windows to sell for $50 since they can obviously afford to do that. I would also like to pay $2 for a gallon of gas. The point being that there are plenty of people willing to pay the money because they need Photoshop that they do not need to cater to our segment of the market (yet).

-Kerry
http://cameradojo.com

August 1, 2008 6:36 am

@Brian – “It’s easy to outgrow, and the next step is pirating Photoshop.”

Aside from your “survey” being about as flawed as they come, I really find it interesting how easily you just pass over stealing software as if it were perfectly acceptable, just because you don’t like the price of it and because everyone else is doing it. Why use the word “pirate’? Why don’t you just use the more precise description “steal”?

Since you seem to think that pirating (stealing) software is the logical and only next step, as opposed to actually purchasing the software “legally”, maybe someone who thinks that paying the price for the camera you own is too much will just decide to steal (oh, I’m sorry, I meant pirate) yours. After all, if the camera manufacturers would lower the price of their cameras by a third, I am sure that more people would be willing to buy them and they wouldn’t need to steal (or pirate) yours from you. By the same reasoning, if I like a photograph you have taken and yet don’t want to pay you to use it because I think you want too much money, I suppose that you won’t be opposed to my pirating it.

Yes, I own Photoshop, and yes it was legally purchased, and yes, while it bites to have to pay the purchase price, however, I pay it because that is the price of legalling purchasing and using the software. If I don’t want to pay the price because I can’t afford it or because I think it is too much, then I do without it or look for something that I can afford that will do most of the job, I don’t just then decide that my considering it over priced justifies stealing it.

It is the same reason that I do not own a Lexus, Mercedes, or BMW, because while I think they are way over priced and I am unwilling to pay the price they want for it, I am also unwilling to “steal” one. It is one thing if you want to convince me that Photoshop is over priced, it is something else if you think your belief that it is over priced justifies your or anyone else stealing it.

August 1, 2008 8:26 am

You might be interested in Joel Spolsky’s take on pricing. He’s a small-business owner who builds software… very successfully. He has many insightful posts into business, software, and user experience; these two are directly relevant.

How to pick a price:
http://www.joelonsoftware.com/articles/CamelsandRubberDuckies.html

Pricing as a signal:
http://www.joelonsoftware.com/items/2005/11/18.html

August 1, 2008 3:00 pm

I dont know one person who uses a legit copy. I hate pirated stuff, but ended up usding a bootleg copy until I discovered Gimp and switched – the guilt was too much and I’m a goody two shoes!

August 1, 2008 4:03 pm

@NRG Some great points you’ve brought up about other segments of the Photoshop market. As photographers,we tend to get caught up in our own little photography world. (And thanks for not burning me at the stake this time).

@Kerry I’d like a lot of things too — especially $2/gallon for gas! It’s interesting though, because you bring up a good point about Photoshop as a “need” rather than a “want”. Many photographers “want” Photoshop. Many businesses “need” it. So obviously they can charge what they’ve been charging and do quite well. I too am following the development of Lightroom — I’m not on board yet, but I may be someday. It’s getting closer to being able to handle a majority of photography needs, but it’s still missing a few bits and pieces. Maybe in Lightroom 3…

@bc First of all, what makes the survey flawed? You’re on a photography website, and we’re having a discussion about Photoshop from a photographer’s perspective based on results from a poll voted on by other photographers. Secondly, I never stated that stealing software was acceptable, and I don’t think that should be inferred by my choice of the word “pirate” — that’s what it’s called when you rip off software electronically. We’re not talking about thousands of people going to a software store and stealing Photoshop off the shelf — it’s electronic theft — PIRACY. Aside from the terminology barrier we seem to have, I don’t appreciate having a finger pointed at me stating that I support piracy or that I pirate the software myself. I stated that Photoshop Elements tends to be a gateway to pirated Photoshop. From what I’ve experienced, most people who use Photoshop are using a non-legal copy. And I’m sure the rates of illegal use are much higher with those who don’t have a commercial need for a legitimate copy of the software. I was only making a general observation, not proclaiming my support for software piracy. I don’t “steal” Photoshop or any other software. I’ve been using Photoshop for many years, and I pay the price each time a new version comes out. Sure it sucks, but I don’t bitch and moan about it. And I definitely don’t support the piracy of Photoshop or any other software (or cameras or photos for that matter). Next time you accuse somebody of something, do some research on that person first.

@Nermal Cool articles — thanks for pointing them out. The first one, on how to pick a price, is essentially what I’ve gone through with this poll to arrive at the information in this article.

@Charlene You’re probably not the only one — everybody seems to know somebody using a non-legit copy of Photoshop. Good for you on switing to the Gimp. I think it’s a great solution for those wanting to be super-economical.

August 1, 2008 11:59 pm

Whew! Nothing like a good flame to get your numbers up. Love the side effects.

Nicely written and nicely replied, Brian.

I too think that Photoshop is a bit too expensive. I support the suggestion that you consider GIMP as a nice alternative. I am a lover of Apple’s Aperture, and use it for 99% of my photo processing. I’ve grown to shoot a better photo, so it needs less processing too. That helps!

However, I do have a copy of Photoshop, CS2 to be exact. Having a one-version-old copy is also a great alternative. It’s usually cheaper, and you could consider buying a used copy from someone you know who regularly upgrades. (mine was given to me though)

August 2, 2008 3:36 am

@Brian
No, you don’t outright state that stealing software is acceptable, however, you do seem to focus on the stealing of software as the only option available, and the people are pushed to stealing it because it is so overpriced. Maybe you don’t personally condone it, but that is a difficult conclusion to draw from the tone of the article. People steal software electronically because they do not believe they will ever get caught, it is anonymous, and it is easy to achieve as they don’t even have to leave their home to do it. However, your right in that it isn’t the same as walking in a store and taking if off the shelf, because these same people would never risk it, because 1) they know it is stealing, 2) the fear of getting caught and prosecuted is too great, and 3) the embarrassment of their friends finding out that they are nothing more than a simple thief is too great a risk.

You say that don’t find stealing software acceptable, but those are the primary alternatives that your article seems to focus on, given statements like “It’s easy to outgrow, and the next step is pirating Photoshop.” and “probably just be pushing more people to pirate the software rather than buy it”. Gee, I thought maybe the next step might be to actually purchase a copy of Photoshop or maybe even explore some of the other photo editing software alternatives that are priced lowered than Photoshop.

Aside from all the other points that have been made concerning the legitimacy of this survey, any survey that asks what would you pay for something, and then concludes that if the price were lowered, people currently stealing the software would all of a sudden buy it, is completely flawed. If this were the case, then they would not have any cheap stolen software on their system. However, people who steal software have no price-driven boundaries, and if they have one piece of stolen software on their system, they typically have many, even if the cost is as little as $10-$20, which is why your conclusions to this survey are flawed, because you are assuming that
these people will all of a sudden give up on stealing software, which ultimately drives your revenue per 1000 users chart, which is heavily based on previously illegal Photoshop users going legit and purchasing a legal copy of Photoshop, which in turn will drive up Adobe’s revenue.

I find the premise of this article that someone that is willing to steal a $700 piece of software or $300 upgrade is all of a sudden going to go legit and purchase the sofware just because price has been lowered a flawed premise? If Adobe would lower the price, it would probably just result in their stealing a $100 software upgrade instead of a $300 software upgrade.

Though I am glad to hear that you don’t steal or find it acceptable for others to steal software, I wish that had been the underlying tone of your article, and while software theft would have to be acnkowledged as a problem, it should not have been treated as if were the first or only option that was available, and even forced upon theose stealing it, as was inferred in severl statements that were made in the article.

As for me, I find it extremely difficult to understand how anyone whose very product that is so dependant on copyright protection and usage license, such as photographers and their photograogic works, would be so willing to violate software copyright and usage licenses. I have to hold onto the belief that only a very small percentage of photographers would be so hypocritical as to have this attitude. I would hope that all photographers would afford software the very same protection they demand and desire for their own bodies of work. If not, then I don’t understand how anyone that does steal software could be so surprised and outraged when their photographic works are stolen and used by others.

August 2, 2008 5:01 pm

Wow.. staurday night and it’s an all out fight! (I’m all of a sudden thinking of NICKELBACK – SATURDAY NIGHT’S ALRIGHT (FOR FIGHTING) song.

I think the big point for people to truly understand is that Photoshop is not geared towards your common Jane or John Doe enthusiast photographer. There is plenty of ‘more affordable tools’ out there for just that purpose.

At the end of the day, Photoshop is an industrial grade image editing tool, and is thus priced accordingly. It really is that simple. Photoshop was around and used in many graphic based industries for quite a while before digial point and shoot cameras and DSLR’s became mainstream.

The common perception is that since digital photography has taken off like a rocket, many ‘regular non profesisonal’ people hear of photoshop for image manipulation and turn to it as a ‘tool of choice’ since Photoshop is so well known for those purposes.. but the problem with this of course is that when people inquire about the cost and fall off their chairs when they see how much a non-upgrade initial purchase is, they complain that it is too expensive (and yes, for many people, it is). But again, we come full circle to my point here. Photoshop is not geared towards that ‘market’. It is an industrial grade tool.

Those people must learn to let go of complaining about this and seek out other alternatives if they wish to acquire legal licensed copies. For those non-professionals, Lightroom or Photoshop Elements are built for this segment. Will those products do as much as the full fledged Photoshop? Nope. But you get what you pay for.

All this talk of ‘I want Photoshop to be MUCH cheaper’ is akin to me walking into a Ferrari delaership and demanding a Ferrari for the price of a Ford (Because I happen to really like Ferrari styling and they get me from point A to B really FASSSST. so I want it affordable!) Not going to happen. Wrong product for the wrong market.

Cheers,

NRG

August 2, 2008 6:02 pm

@Brian, bc

The reason everyone is using the word pirating with regard to using unlicensed software is because it is not stealing (From the pure legal view). It is a copyright infringement.

The same way you don’t steal movies (When downloaded) or musing (when downloaded) or photographs or making an unlicensed copy of Mickey. All of these are infringements on copyright protection and are not stealing.

This simple example just show how much the media companies managed to brain wash our mind.

August 2, 2008 6:13 pm

@bc Sure, people are going to steal Photoshop even if it’s $50 off the shelf. And sure, all of those people who said they’d pay $100 for the software probably wouldn’t buy it. But I’m willing to bet that MORE people would buy if the price was lower. This isn’t just converting people from stealing it to buying it — that includes people who refuse to steal it and refuse to pay the asking price (so folks who use alternative software). Are the numbers in the chart an exact prediction of what would happen at different price ranges? Heck no, but they’re probably not completely off. This wasn’t intended to be a highly controlled scientific study — it’s a collection of the community opinion and a discussion of the results.

And yeah, photographers who steal software shouldn’t be getting too upset over their images being stolen.

August 2, 2008 6:24 pm

@Brian
I agree with your points above. I should have acknowledged that I do not know if any of the respondents do or don’t currently use Photoshop or whether they currently have a legal copy or not. And, yes, it is possible that people that have passed on it completely because of price might be swayed to purchase it if the price were lowered. Obviously, knowing these variables would have lent more credence to the conclusions that are drawn, but it would have required a lot more information from the respondents.

As pointed out by Neil, If the respondents don’t currently own Photoshop, it would require that they purchase the full copy and not an upgrade copy, before they would get involved in the subsequent upgrade cycle. As Neil also pointed out, I could see where this could have been confusing and it makes me curious as to how the respondents would answered the question concerning a fair price for the full version of Photoshop, in order to become elgible for the upgrade path pricing.

@NRG
You make some of the best points in this entire thread as it would have been more meaningful if I had skiipped the soap box and offered options to Photoshop that might be more suitable for many, as one of the most important points that you make is that not everyone needs Photoshop, even if they might want it.

I have and do use other software packages, mostly because Photoshop is often overkill for the task at hand, and generally the disparity between Photoshop and these other software offerings is not as great as perceived, though some tasks are easier to accomplish in Photoshop. It is just that Photoshop tends to be the standard that everything else is judged against, whether all of the features are truly needed or not. Realistically though, a 90%, 95%, or 98% solution is far better than no solution at all, leaving the bigger question as to whether the additional functionality that Photoshop offers is really required or worth the difference in price between it and cheaper alternatives that may meet one’s needs.

August 2, 2008 8:17 pm

Brilliant idea. Thanks for posting this. :)

August 3, 2008 1:49 am

Wow, interesting that some people take such offence when you say Photoshop should be cheaper.

I think you have a good point, Brian.

August 4, 2008 7:02 pm

I would like to offer that the results of this survey do in fact prove that Photoshop upgrades are priced just about perfectly. What your survey concludes is that the majority of people think that the upgrades are overpriced by approximately $100 (because if money is that big of an issue for someone than they would wait until the price dropped to $200, making it $100 more than they want to spend). To deal with those who are pirating- the price of Photoshop upgrades dropping by $100 will not affect the majority of those who pirate software. The problem is that the people pirating Photoshop can’t (or won’t) pay that initial $700, and because you can’t upgrade an illegal copy, when the next version comes out they are “forced” once again to use the software illegally.
If we are now dealing with those people using Photoshop legally, and who made that initial $700 purchase and are now upgrading their software, if the $200 upgrade price is too expensive, most people will choose to upgrade only every other version (in fact software companies don’t expect customers to upgrade every version). I know many photographers, even businesses who only upgrade their software every other version. It even makes logical sense; if I am willing to pay $100 to upgrade but not $200 then the logical conclusion is not to steal the software, but to upgrade every other version, making each upgrade, cost in essence $100.
So that leaves Adobe with a choice. Do they charge a $100 upgrade price Or do they charge $200 assume that they are still going to be making $100 per upgrade off of all the people who upgrade every other version, bank on the fact that they’ve included enough new features that some people who swore that they will only upgrade every other version will give in and purchase it anyway, and profit the full $200 off of the people who admitted that they are willing to spend that much per upgrade? Oh and they even take it 1 step farther by charging $300 initially to everyone who just has to have the latest and greatest immediately.
If we use your numbers then Adobe’s current upgrade option (using my every other version upgrade strategy) looks more like this:
They make $75k (because those willing to pay only $100 will upgrade every other version, leaving adobe a profit of $100 per upgrade or $200 every other upgrade)
Approximately 23% of your readers are willing to pay $200 per upgrade so we can assume that these people will upgrade every version of Photoshop after the price drops, so netting Adobe an additional $23000
Now we can assume that the 7% of people willing to pay $300 for the upgrade will upgrade before the price is dropped, netting Adobe an additional $100 per person for a total of $7000.
So by charging a $300 upgrade price which is later dropped to $200 Adobe will net $105k as opposed to the $75k they would net with a $100 price (using your numbers). This is wit out any impulse buyers (those who just can’t resist upgrading more often than their budget allows).

I believe that if anything your survey proved just how good Adobe really is at pricing software upgrades. And while our budgets may not appreciate these prices, we pay them anyway (well some of us do). Adobe deserves to make their money too.

August 5, 2008 9:59 am

Brian,

Interesting study, but I think I’ll have to agree with Neil that the upgrade cost is not the major limiting factor when it comes to getting photoshop. The initial investment is. The upgrade cost, in my mind, is much like a service or maintenance cost which must be borne over time.

I think that because of the scope of your audience, we’re also looking at a much smaller market that has cheaper alternatives. When you get in to the professional photography and image manipulation/retouching market (dont forget film editing/retouching, 3D graphics professionals, Web Designers, Print designers and a whole bunch more), there are people who get paid a lot for their work (if they’re good) and would not mind paying for a world class and industry standard product. I do believe that these are the people that Adobe is marketing Photoshop to.

The amateur photographer is better of checking out Photoshop elements.

Take a look at the Photoshop Family Page at adobe.com There’s comprehensive list of their target audience below each product.

I usually agree with you, but I believe in “the right tool for the right job” and using a bazooka to take out a cockroach is absurd. This is the case with the average man using photoshop.

So, overall I don’t think your argument is very valid. I think they’re doing fine in the pricing dept. (even though its really really expensive even for me). Sorry.

August 6, 2008 8:08 am

and oh! I do think that Photoshop is way too expensive, but that’s not going to change Adobe’s price point, is it?

August 6, 2008 8:32 am

I have to agree with BC on the inaccurate conclusion drawn regarding potential revenue generated at the lower price point. I believe that people responded to not ‘what would I pay for photoshop” but rather “what would I pay IF I couldn’t pirate photoshop”. BC has a point in that people who pirate software aren’t suddenly going to begin purchasing a legal license once the price is lowered to their threshold. Accordingly, the potential revenue generated at any given pricepoint needs to be reduced by those respondents who already have a pirated copy.

August 7, 2008 7:47 am

I would like to suggest this perspective: Photoshop is under priced!

Shocking? Not when you compare it to Solidworks 2008 and other CAD software. Solidworks costs about $4000 per seat and pretty much requires a $1200 per year subscription.

Now I can hear people screaming, Photoshop is not CAD! That’s true. Photoshop is a bitmap image editor. Solidworks is a vector image editor. See the correlation?

August 7, 2008 9:02 am


Its the same in the CAD industry. Here you have AutoCAD for $4000 and along comes a clone that cost 1/10th the cost, progeCAD IntelliCAD. Autodesk spends millions marketing AutoCAD every year, thats what you are paying for when you buy AutoCAD. progeCAD does the same thing with the same files and costs less than $400 dollars and people are snapping it up while the marketing is probably less than a couple hundred thousand a year.

November 17, 2008 11:45 pm

Look, just like every greedy, thoughtless Corporate American company, Adobe is going to do what they want to do. They will increase the prices more in hoping that someone would be stupid enough to buy their bloated products which there are people out there would love to feed the corporate giant. They just quickly released CS4 products. Heck! The CS3′s aren’t ready to be vanishing off the market yet but it is now. Adobe is looking for fast way to make money just like every company out there. They don’t care about you all! Ok? All they care about is the O’ Mighty Dollar. Lowering prices is against their interest. People can make up excuses for any company, but the real excuse is that companies want to get rich fast because money means more to them than anything else.

December 24, 2008 2:08 pm

I’ve always thought PS was way over priced. So many more people would use it if it was affordable, which would make them more money in the long run.

February 21, 2009 1:16 am

One my favorite words is "elitist". It applies to so many people and products. Of course Photoshop is GROSSLY overpriced but because they have virtually (I mean perceptually) no competition, they can justify outrageous prices. My wife is a Graphic Desiner and uses PS but also uses Corel software. For most projects she prefers Corel because it is intuitive and she loves the vector process. (please..unless you have used Corel extensively… you are not qualified to compare. I hate it when people try to compare what they know to a product they’ve never used)) However, Adobe is perceived as the standard..because we have followed like willing sheep. I do know about anothger Adobe product…Adobe Audition. It was originally Cool Edit Pro. They "redesigned" it and with each new release, it gets less and less intuitive. I often wonder if the eggheads who desing software ever actaully USE it in the real world.

April 7, 2009 7:44 am

I use photoshop on a regular basis due to work. Allthough it is quite expensive it is worth its weight in gold. I couldnt do my job without it and adobe know it so can charge what they want. Me personally id pay whatever they asked as i need it for work and love using it. Hopefully the price will come down but either way whatever the cost i would buy it.

October 17, 2009 7:10 am

Is BC an Adobe Shareholder/employee?

At the beginning, I was pretty convinced that PS ought to be cheaper, but after the many Ferrari/BMW/Lexus analogies, I now understand why it is such a highly priced piece.

It’s industrial grade, so it’s costly. Go buy something cheaper if you want lesser features/convenience.

March 11, 2010 9:48 pm

I have seen several people give the argument that Adobe needs to raise their prices because
of piracy.

This is false… the piracy is rampant for Adobe because of their pricing.

And the pricing of vendors who sell software like CS4 for the original release price even after
CS5 has been released.

A MSRP of $248.00 has been published on several web sites for AI CS4.

But try and get AI CS4 for $248.00, vendors are still pricing it at $599.00 or more. Even the legal
sellers on ebay!

So I feel no pain for Adobe. They and everyone else who sells Adobe products are pricing
the packages for what they feel they can get for it. Not the actual market value of the products.

The arguments about the features and quality, blah, blah, blah are stupid. I have used Corel
products and Adobe. They have bugs and issues in both products. Or I suppose there are some
who place Adobe at a higher level of quality because of their relationship to Apple.

June 18, 2010 7:44 am

As Mike said in his comment above mine, it’s totally Adobe’s overpricing their software ($700 for a single application?!) that spurs people to download unlicensed copies of the software. (I refuse to say ‘steal’, because this is a matter of copyright infringement, not theft, which is a PHYSICAL act.) Adobe have the graphics market cornered.

When people think of graphics software, what do they think of? Photoshop. Software is not the same as cars. Computers themselves do better with the car analogy, because they’re physical objects. Software? Not as much. I do think Photoshop is valuable, but the price for the Adobe suite should be knocked down to about $300, and $150 on a student discount. The same applies to Microsoft and Office. Because Microsoft have office software cornered, people end up shelling out ridiculous amounts of money, or pirate the software. In my case, I get enough MS Office documents from work/class that I will end up sucking it up and paying the $99 for the academic copy of Mac Office once Microsoft come out with Office 2011. OpenOffice crashed on its first launch, and iWork doesn’t open all MS Office documents properly.

Yeah, you can use the GIMP, but it’s user-unfriendly, and on the Mac, it’s not native-acting or -looking at all. I have tried so, so very hard to give the GIMP a chance, and I just can’t do it. It’s clunky, and obviously not made by designers, or with designers’ inputs. The interface is largely influenced by Windows and Linux users, and the Mac port is a half-arsed one that requires X11. Elements? Not exactly adequate for a lot of people’s needs. It’s good for some things; I had a copy of Elements that came with an old Wacom tablet I had several years ago, but it was hard to use after I’d become used to Photoshop proper.

August 31, 2010 7:20 pm

Comment now!