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Autodesk Licensing: Transitioning to Named User Licenses

Managing the Transition to Autodesk Named User Licensing

Autodesk has an aggressive compliance program which has ramped up over the last months. Properly managing your Autodesk estate can save your organization millions of dollars in cost savings and audit findings.

Autodesk is moving from a licensing model based on serial numbers to a named user licensing scheme. Organizations need to understand the impact of this change on their environment and consider trade-in offers that Autodesk is promoting to support the transition. Maintenance Plan renewals for currently Standalone and Network licenses will end on May 7, 2021, so organizations that have not yet transitioned will need to act fast.

During this webinar we explore the differences in the previous and new licensing models, evaluate the impact of transitioning to named users on your environment, and provide best practice recommendations to help optimize your Autodesk estate.

The History of Autodesk

Autodesk was founded in 1982 with just $59k by six developers, including John Walker and Michael Riddle. AutoCAD was Autodesk’s flagship product. At the time, AutoCAD was a niche piece of software and was released when most computers didn’t even have mice. It may seem strange to us now, but Autodesk software was one of the first that could draw perfect circles with just a command.

By 1989, Autodesk controlled 60% of the market share for CAD software – an incredible feat that only continued to increase. In 1992, Carol Bartz was named CEO and John Walker returned to developing. Bartz brought more of a business mindset to the organization and among the many decisions, narrowed the focus to the Windows platform. Under her tenure, she led the company from $300M revenue to over $1.5B in revenue.

Autodesk has been on a journey to become a fully SaaS company since 2001 when its subscription service debuted. In 2016, Autodesk announced that perpetual licenses would no longer be sold. At the 2017 Investor Day, Autodesk announced its strategy to complete the transition in 2020 and said that the last day to purchase new perpetual licenses was January 31. While this was the announcement, organizations have since been able to buy new perpetual licenses.

During that 2017 Investor Day, Autodesk also shared their targets for the next 3 years. The original target set for total subscriptions was 5.4 million, however by 2020 Autodesk reported 4.9million subscriptions with a slightly smaller operating margin.

In last year’s (2020) Investor presentation Autodesk declared that the transition was over. As part of this, it announced the end of support for perpetual licenses and multi-user subscriptions in 2021 to consolidate into named user licenses. A number of trade-in options were made available to support customers during the transition.

Interestingly the first source of revenue growth mentioned in the 2020 keynote presentation, was monetizing non-compliant and legacy users. As a deep dive into the audit revenue stream the CEO mentioned hardening systems and transition to named users, deepen understanding, and targeting. So it is important to keep this in mind from an overall Autodesk business strategy perspective.

Preparing for the Transition to Autodesk Named User Licensing

To ensure that your organization transitions successfully to the named user licensing model, we have outlined 5 steps to take:

1. Understand the perpetual license model
2. Consider the new license model
3. Make an informed business decision
4. Count periodically & accurately
5. Manage your estate proactively

Understanding the Autodesk Perpetual License Model

Let’s first revisit the Autodesk Perpetual license model to understand what is changing.

Autodesk Network Licenses

– The Autodesk network licenses use an underlying FlexLM technology to run on network servers. This is a multi-seat license that sits on the server and as user opens a product, the license is pulled off the server. Once the product is closed, the license loads back up to the server and can be used by someone else.

Autodesk Standalone Licenses

– Originally debuted with physical hard-lock keys.

Auto Desk Multi-User Subscription

– This differs from the network licenses in that it is meant to be more user-based.

Considering the New Autodesk Licensing Model

There are many changes that Autodesk is introducing to meet its new goal of additional 2M Targetable Subscriptions within their existing customer base. These changes include: product collections, support models, and license metrics. Here, we address each of these to explain how these changes work together to impact your licensing.

Autodesk Product Collections

– Autodesk has introduced Collections designed to include the relevant applications bundled per industry – Architecture, Engineering & Construction, Product Design & Manufacturing, and Media & Entertainment.
– Collection licenses are more expensive than purchasing the individual application licenses, but if you are using multiple products it may be worthwhile, depending on your business needs.
– From a license perspective, during an ELP, consumption at a component and a bundle level needs to be reviewed to determine the usage and optimization for those products. If users are not consuming multiple applications, then it may represent a cost savings opportunity if they are under-utilized overall.

Autodesk Subscription Plans

There are new and different Autodesk subscription plans that impact the level of support, reporting, access rights, and admin rights that businesses should consider when transitioning to the new licensing model.

– Standard- typically for smaller teams with aggregate level of reporting only.
– Premium – 50+ users with more detailed reporting on a per user basis.
– Enterprise – intended for large customers as part of an Enterprise Business Agreement or EBA. This includes additional customization like inputting metadata relevant for your business and control over admin rights. Token Flex licenses are only available for Enterprise clients.
– Education – Autodesk has an Education Offering for authorized students from a qualified educational institution which Autodesk may require you to verify eligibility. The entitlement may contain limitations, for example that the outputs can only be used for educational purposes, rather than for commercial gain, so something to be aware of if you have interns.

Autodesk Subscription-Based License Metrics

– The key difference between Autodesk’s perpetual license model and the subscription-based model is that on the previous system you had access to use those licenses in perpetuity. So long as maintenance was paid on time, you were able to upgrade to the latest version and have access to support. However, in the new subscription model, all rights to use the software ends when the subscription license is not renewed, as with all SaaS products.
– Autodesk Network licenses, Standalone licenses and Multi-user Subscription licenses will all now be merged into named user licenses.

Autodesk Named User Licenses

Named User licenses are:

– Determined per email address with a subscription account to use the software. It does not matter how often they need to access it; one account is required per user. This means that if you have 100 users sharing 60 network licenses now, you will need 100 licenses moving forward. It is important to note that the license can be installed on up to 3 devices as backups, however only one can be in use at any time.

Reassignment rules:

– Depending on your agreement, previously only the primary admin could reassign licenses, however under the subscription model, the secondary admin can also assign software, reducing workload and dependency for the primary admin, especially given there can only be one primary admin.
– Generic logins, or multiple people having access to one email account are not permitted unless under specific agreement.
– If you have an EBA, you can assign and give access to an unlimited number of users at a flexible, daily rate for a 3-year term. This is also known as Token Flex licenses.

Autodesk Token Flex Licenses

– Under an EBA, you can purchase x number of Tokens, and each time a user accesses an application, it consumes tokens. Organizations can prepay for x number of tokens to be consumed per year, and then there is a price-per-token above that allotment.
– The number of tokens required vary per application. Typically, the more expensive applications will consume a higher number of tokens compared with cheaper applications.
– Token Flex licensing also includes back versioning rights for y number of years, depending on your negotiated agreement, which can be between 2 to 5 years.

Token Flex licensing is a great option for organizations who have a high number of users accessing licenses infrequently because you pay based on usage, rather than the number of people. However, if you have many users who use the software all the time, it could be cheaper for them to be on the named user model, and those who require the software less often to be on the Token Flex model. It is possible to have both. Optimizing the estate to get the best of both worlds will require ongoing analysis with trending consumption over time.

Autodesk Cloud Credits

Cloud Credits are another option, which are similar to the Token Flex model.

– An Autodesk Cloud Credit is a unit of measure for certain Autodesk consumption-based web services.
– These Cloud Credits are based on performing discrete tasks like rendering or running a simulation. This model is highly customizable and varies by service. – Autodesk Cloud Credit usage rates are determined by Autodesk and would be contained within your specific agreement. Because the structure of the Cloud Credits is so bespoke, it is particularly important to be closely monitoring usage.
– In this model it is possible to exceed your allocated Cloud Credits, and ‘true up’ afterwards.

While Autodesk will endeavor to notify users of anticipated excess use, this is not guaranteed. Any excess use will be subject to agreed pricing. For more detail follow this link.

Making an Informed Business Decision

When it comes to transitioning your Autodesk licenses you essentially have three choices:

– Move to a subscription model
– Keep your perpetual licenses
– Adopt a hybrid model

Pros and Cons of Moving to an Autodesk Subscription-Based Licensing Model

Pros of the Autodesk subscription-based licensing model:

Simplified

– No need to locally manage and maintain license servers because it’s hosted in the cloud.
– Easier for working remotely.
– The secondary admin can assign and unassign licenses.

Secure

– Depending on corporate policy, users can update software via their Autodesk account without needing to wait for deployment by the admin.
– No updates of perpetual licenses will be available from May 2021. You are permitted to continue using perpetual licenses, even if not under maintenance, however, depending on your business case, you may need to test backward version functionality.

Visibility

– All support levels provide aggregate reporting of how many people are using each product, the version and overall frequency of use.
– With Premium and Enterprise level support, you have access to more detailed reports, including which individuals are using what and how often.
– Detailed reporting including exports available from Autodesk console.
– With Enterprise support level you can add company specific information like location, business area to tailor it to your needs. Note: reporting is not available for all products, currently available for cloud products, cloud services, and some desktop products.

Availability

– Any user who has been given access to a license can use it, there are no issues of people forgetting to log out and check the license back in.
– Can be used working from home. Note: In general, enterprise or server-based products (network-only products), and those that do not require activation are not eligible for home use, however this is dependent on the agreement.

Cons of the Autodesk subscription-based licensing model

High cost

– Subscription licenses are expensive and should be modelled 3-10 years to forecast the bottom-line impact.
– The modelling should consider how often the users need to access the license. Even a trade in offer of 1 network license to 2 named user licenses, may be more expensive than your current ratio of number of users to network licenses, particularly for organizations who have optimized a follow the sun model.
– Note: If you choose to renew maintenance on perpetual licenses, this will be at an increased cost before May 2021.

Access to old versions

– While newer versions of Autodesk software are backwards compatible, being able to access previous versions of the application is dependent on the agreed number – typically 3 years. If you have held on to very old versions that you need to have access to for testing purposes, and trade these in, you will no longer have access to those versions of the software.
– There are no alternatives for new licenses – all new licenses must be purchased under the subscription model.
– You cannot access licenses once the subscription has ended, so you are locked in to continuing accessing.
– You should anticipate extra scrutiny from Autodesk if you do not transition. Autodesk announced at their Investor Day 2020 that with the transition to subscription being complete, the first long -term business drive is monetizing non-compliant and legacy users. The Investor Day overview cited 12M non-compliant users, and Autodesk is known to have an aggressive audit program. Regardless of the strategy your organization pursues, maintaining compliance must be a high priority for everyone.

Autodesk Named User Licensing Trade-In Offers

Autodesk have announced Trade-In offers to support customers with the transition and encourage them to make the switch. This includes locking in ongoing discounts until 2028.

Multi-user subscription renewals extended to August 7, 2022.

Standalone maintenance

– Trade in 1 standalone maintenance for one subscription license 1 at a price consistent today before May 7, 2021.
– Otherwise, the price increases on maintenance after August 2020.

Network maintenance

– Trade in 1 network for 2 named user subscriptions at the current maintenance cost.
– License with network maintenance plans will retire May 7, 2021 and cannot be further renewed.
– At the second renewal after August 7, 2020, you will be eligible to trade in one multi-user or one network maintenance plan for one named user.

Perpetual licenses without maintenance

– If you’re using an older perpetual license without maintenance, there aren’t specified trade in models, however Autodesk offers savings for the same, or different product or collection, so if this is something you are interested in, then best to talk to your reseller or Autodesk directly

Autodesk Hybrid Licensing Model

– You can choose to have a hybrid model where you can keep the perpetual licenses that you need, trade in what can be moved to subscription.
– It is clear that Autodesk wants to transition all perpetual licenses to subscription, however, you still have the rights to use your perpetual licenses forever, so long as you take into consideration the risks that may come along with it.

Consider how your business strategy impacts the transition.

The other key part to making this decision is of course your business strategy, as there is no one-size-fits-all approach. Here are some aspects to look at:

– Growth area or likely to decommission?
– Need for continued access to previous versions?
– Cost/ Benefit as mentioned above
– While it can be an expensive and lengthy process, it is always possible to consider alternate providers if the vendor does not align with your business strategy.
– Autodesk is a dominant player in the CAD-industry space, and with the investment in their training program since 1994, there are some aspects of the market that has come to expect knowledge and access to Autodesk software.

Negotiate with Autodesk

– Once the strategy is aligned across your organization, it is time to open conversations with Autodesk, or reseller. This strategy will include decisions made about the overall approach (maintain perpetual, transition to subscription or hybrid), level of support, products (individual and/or collection) and the type of licenses required (Named User, Cloud Credits, Token Flex for EBA). Terms will then also need to be negotiated including your legal counsel. Anglepoint recommends reviewing these terms in great detail as this is what will be relied upon in the event of an audit. We encourage our clients to have fair and balanced agreements with vendors, which is sometimes difficult to achieve. Anglepoint has a dedicated contract negotiation practice with deep expertise to understand the risks and benefits of contractual terms and provides guidance on best practice terms and conditions based on years of industry experience.

Count Periodically & Accurately

It is very important to review entitlements and consumption to create an Effective License Position (ELP) both before and after any transition to a different license model. Anglepoint specializes in counting and counting well to give visibility into your estate and provide actionable insights to maintain compliance. It is important to do this before the transition to have an accurate snapshot of current usage and what needs to be included in the new agreement. An ELP after the transition is complete will show whether the new agreement is meeting your business needs, and will check that all remaining perpetual licenses have been effectively de-installed and removed from the estate.

Manage Your Autodesk Estate Proactively

Managing your technical environment and overall software footprint is critical to SAM success. In relation to Autodesk (and many other publishers), completing health checks of entitlements and usage is not only beneficial but necessary.

Completing an Effective License Position (ELP) is the best starting point to proactively manage your Autodesk estate. However, it is not enough to do an ELP, the business needs to take the data and use it to make informed business decisions. This means understanding the detail, overlay with business strategy, and understand how the business is using the software. To make this process easier, Anglepoint creates a Risk Opportunity Assessment Report that accompanies an ELP that provides realistic and actionable steps to optimize your environment. This might include cost savings by not renewing maintenance on unused licenses, purchasing additional licenses to cover consumption, identifying unauthorized software usage, best practices to structure license agreements among many others.

– In addition to doing an ELP and ROAR, there are a few other considerations to proactively manage your Autodesk estate.
– Understanding how and why the business uses Autodesk software is important to appreciate what the users license requirements are. For example, what type of employees need access and what are they using the software to create? Do they need access for the whole day, or is it occasional usage.
– Further, it is critical to be aware of specific terms and conditions in your Autodesk agreement that need to be actively monitored to maintain compliance. For example, back versioning rights are common for Autodesk, so access to previous versions is permitted, which can b n-2 to 5 years depending on your agreement. Geographic restrictions are also common in Autodesk licensing, where usage of licenses can only be in the home country of purchase, unless under specific conditions.
– In addition, there exists a high amount of Autodesk pirated software, which can be a key item in audit settlements and Autodesk regularly tracks illegitimate serial numbers. Unfortunately, even when there are authorized licenses available, some users still decide to access pirated software. This is potentially a criminal act of copyright infringement and is in breach of the Autodesk contract. It is imperative to have processes in place to prevent unauthorized software usage, educate users and monitor closely.
– Another point to proactively manage your Autodesk estate is to confirm that all software that should be removed, including any perpetual licenses that have been traded in, are completely deinstalled from your estate.

Anglepoint Can Help You Transition Your Autodesk Licensing

Managing the Autodesk licensing portfolio is not an easy task, as we have gone through above. Autodesk is a diverse publisher, with many complexities in contracts, language, and licensing. This complexity combined with Autodesk’s focus on compliance makes this a publisher to keep your eye on. If you haven’t checked in on your Autodesk portfolio, now is the time to do so.

It is critical to understand and proactively manage the transition (or not) to the named user license model. We understand that most internal SAM teams don’t have the exposure to numerous publisher audits and are not familiar with the intricacies of Autodesk licensing in the previous and new model. Anglepoint’s specialty licensing program currently has expertise over 85 publishers and growing. If anything from this article has resonated with you, or has prompted any questions that you may need help with, please reach out to us and we will happily support.