Price Increase - HOLY CRAP!

[BryanCrow]

What on earth makes Macromedia think this new version warrents such a massive
price increase!?!?!

FlashComm - $4,500 = 2,500 connections / 10MBps bandwidth
FMS2 - $4,500 = 100 connections / unlimited bandwidth.
FMS2 Upgrade = $2,000 = 100 connections / unlimited bandwidth.

How could Macromedia possibly think that the addition of a new codec, and XML
objects warrents a 2,400% price increase? How can anyone afford it at that
price? It's just not profitable no matter how you look at it...

It must be a type-o. Someone please tell me it's just a type-o!

[JayCharles]

The impact of the new license model really depends on the type of applications
you're deploying.

If your apps are bandwidth heavy, but don't need to serve a huge number of
people at once, you actually do better with the new license model. An FCS 1.5
pro license was only really good for 40 or so high quality concurrent streams.
With the FMS license and the lifting of the bandwidth cap, you can pump as much
data as you want to your 100 users. that means 1Mbps+ video to 100 users is a
reality with a single license... provided your box and pipe can take it.

On the other side of this, if your applications are light on bandwidth but
need to serve a lot of concurrent users, the new license model is a problem.
With FCS, you could have 2500 users sipping bandwidth with just shared object
data... looks like that's going to cost a bundle now.

If your apps are bandwidth heavy and need to server a lot of users, then
you're already used to paying out the nose for licenses. The big problem here
is the upgrade program. The FCS 1.5 pro upgrade is $1995, and there isn't a
program in place for a discount on upgrading multiple licenses. Beyond that,
the word I gotfrom MM support is that there will be no more FCS 1.5 "capacity
pack" licenses available, other than those resellers already have in stock. I
envison the following scenario:

I have a client who owns 3 FCS pro licenses. He needs another license to
handle increased bandwidth demands, and needs to serve 400 concurrent users.
Since there's no more FCS 1.5 licenses to be had, we have to upgrade. That
means 3 upgrade licenses at $1995, plus another full version license at $4500
(rmember, we need 400 connections). That means an investment of $10485 on top
of the $13500 already spent on FCS 1.5 licenses... all for a 30% capacity
upgrade.

I worry about explaining that the first time it comes up.

In my last email to MM support, I asked that my concern be passed along to the
appropriate people for consideration, and I was told that ti would be. I'll
post again if I hear anything helpful.

[dejayfx]

i suppose they'll give more connections at some point, just like they did a
while back with flashcom. probably that will happen when the sales plan wont be
met.

or when competition kicks in. one thing is clear. there are lots of people who
simply wont afford fms 2.0 after this move. they'll most likely be looking
somewhere else for a solution. somewhere cheaper.

like jay already mentioned, with this new pricing schema, macromedia is
pushing things towards large clear video streams as the primary use of fms 2.0

[jammin_jamaican]

We had been postponing purchasing FCS until development on our new site was
further along, but with this new pricing, it looks like we'll have to find
alternative options. I have to say that I'm very dissappointed with Macromedia
when it comes to their pricing on FMS. The FCS pricing was high enough to make
small business customers really work to justify the expense and now with the
major price increase, many small business owners will be out of luck. We
definitely won't be able to afford FMS, not when we are already spending a
bundle on hardware, the OS, networking equipment, etc.

[enfantterrible]

Other than potentially down the road Red5 does anyone know of a good alternative to Flash Media Server, for smaller implimentations than MM invisions for its software?

[JayCharles]

There's plenty of choices for data... but not for video streaming... particularly not live publishing.

[jammin_jamaican]

We were interested in using FCS for live audio recording capabilities and
instant messaging (possibly video IM), but we definitely can't justify the
cost. It would provide cool features that the vast majority of our visitors
would never use. The majority of web users don't have microphones or webcams
connected to their computers and of the ones that do, many have no idea how to
use them. For new web technologies to develop and advance, they need to be
made available to a wide audience. FMS is far out of reach for most web server
operators. FMS is far more expensive than a lot of the server OS's out there.

The Linux OS requirements for FMS says RedHat Enterprise Linux 3.0 or RedHat
Enterprise Linux 4.0. Is this the actual requirement or are they just
appeasing RedHat by saying that only the commercial ($$$) versions of Linux
will work? Would it be possible to run FMS on a server running Fedora,
FreeBSD, etc?

When Flash was new it was this great new technology that almost any web
developer could afford. Now that they've come up with new additions to Flash
technology, Macromedia has decided only those who can afford the outrageous
price tag should be able to use it. At least they gave us a few new features
and improvements with regular Flash.

[JayCharles]

Originally posted by: dejayfx
wasnt there an open source project aiming to achieve this at some point ?

Yes... that would be red5 ([url]http://www.osflash.org[/url]). Don't hold you breath
waiting for it though... it could be quite a while before it's stable.

[JayCharles]

Originally posted by: jammin_jamaican
The Linux OS requirements for FMS says RedHat Enterprise Linux 3.0 or RedHat
Enterprise Linux 4.0. Is this the actual requirement or are they just
appeasing RedHat by saying that only the commercial ($$$) versions of Linux
will work? Would it be possible to run FMS on a server running Fedora,
FreeBSD, etc?


Yes.. it's possible to install on other flavors of linux. Macromedia's
position is that only RedHat is officially supported, so you won't get tech
help if you are installing on anything other than Windows and RedHat.

Originally posted by: jammin_jamaican
When Flash was new it was this great new technology that almost any web
developer could afford. Now that they've come up with new additions to Flash
technology, Macromedia has decided only those who can afford the outrageous
price tag should be able to use it. At least they gave us a few new features
and improvements with regular Flash.


Well... it doesn't really affect the developer, only the end client. There is
a free developer's edition that will provide you with everything you need for
building and testing your apps.

Something that I think should be remembered is that Macromedia is not an open
source organization. As a public company, Macromedia is bound by law to
maximize returns for their shareholders, which means charging as much as the
market will bear for their products. If their research shows that the current
license model is what is best for their shareholders, they have to stick with
it.

[jammin_jamaican]

Originally posted by: JayCharles
Well... it doesn't really affect the developer, only the end client. There is
a free developer's edition that will provide you with everything you need for
building and testing your apps.
Ok, perhaps using the term "developer" wasn't exactly what I meant. MANY
companies do their developing in-house (us for example), so many of us are both
the developers and end clients. The developer version does us no good if we
can't afford to actually use the apps in a live, public environment.

Originally posted by: JayCharles
Something that I think should be remembered is that Macromedia is not an open
source organization. As a public company, Macromedia is bound by law to
maximize returns for their shareholders, which means charging as much as the
market will bear for their products. If their research shows that the current
license model is what is best for their shareholders, they have to stick with
it.

Macromedia's current license model may maximize their profits at this time,
but it is also driving a lot of potential customers to seek out other options,
which in turn will advance those other technologies. Take a look at the OS
market, the database market, and many other technologies. Even enterprise
customers are going open-source for a lot of things now. Why? Because they
have gotten fed up with the outrageous prices of server software. Macromedia
is driving the demand for open-source solutions to their product offerings by
charging so much for FMS. A more reasonable price point would accomplish
several things for Macromedia. One, it would further proliferation of Flash
server technology. And two, it would make open-source solutions far less
desirable and necessary. At this time Macromedia probably believes that they
are the ONLY option when it comes to the features provided by FMS, so they can
charge whatever they want. This kind of thinking may benefit their bottom line
now, but in the future they'll end up loosing a huge share of the market to
lower-priced and open-source competitors that are sure to crop up (just like
the OS and database markets). Red5 might not be anything now, but Macromedia's
current licensing model definitely will make us keep an eye on its development.

[JayCharles]

Originally posted by: jammin_jamaican
Macromedia's current license model may maximize their profits at this time,
but it is also driving a lot of potential customers to seek out other options,
which in turn will advance those other technologies. Take a look at the OS
market, the database market, and many other technologies. Even enterprise
customers are going open-source for a lot of things now. Why? Because they
have gotten fed up with the outrageous prices of server software. Macromedia
is driving the demand for open-source solutions to their product offerings by
charging so much for FMS. A more reasonable price point would accomplish
several things for Macromedia. One, it would further proliferation of Flash
server technology. And two, it would make open-source solutions far less
desirable and necessary. At this time Macromedia probably believes that they
are the ONLY option when it comes to the features provided by FMS, so they can
charge whatever they want. This kind of thinking may benefit their bottom line
now, but in the future they'll end up loosing a huge share of the market to
lower-priced and open-source competitors that are sure to crop up (just like
the OS and database markets). Red5 might not be anything now, but Macromedia's
current licensing model definitely will make us keep an eye on its development.


My guess would be that Macromedia has a staff of market and cost analysts who
spend their days doing nothing by figuring out whichmarkets make the most sense
to target. Beyond the issue if the initial sale of the product, there are
tremendous expenses in handling sales and post sale support. Think about it
like this, a single edge deployment will generate revenue equal to 1000 volume
license sales (from what I understand of the edge license structure). The
difference in cost of making the sales and answering the support calls is
obvious, and I'm sure there's other per customer expenses I'm unaware of. If
the market data says there are actually enough customers who will spend $45k at
a shot to offset the potential loss of the small volume customers, it only
makes sense.

As far as open source projects like Red 5, I wonder what legal issues there
may be in using the RTMP protocol. According to the FAQ on the Red5 site, there
aren't any legal issues, but Macromedia hasn't formally endorsed the use of
RTMP (which is proprietary and closed source). Perhaps someone who has some
legal expertice my happen by this thread to shed a little light on that one.

[turtle7898]

Such prices increases are simply forbidden in some european countries.
There are a lot of people who have been developping on FlashComm product and
who now are getting into problems. If one of them feels he lost so much time
and money building a solution around this product, this can be a very
intersting case...

To the flash communication product manager: Dont forget there are lots of
interesting laws in Europe !

[JayCharles]

Originally posted by: turtle7898
Such prices increases are simply forbidden in some european countries.
There are a lot of people who have been developping on FlashComm product and
who now are getting into problems. If one of them feels he lost so much time
and money building a solution around this product, this can be a very
intersting case...

To the flash communication product manager: Dont forget there are lots of
interesting laws in Europe !



Can you post links to the laws you speak of? I'd be interested to read about
them.

[George Wang]

Hi guys,
I'm also notice this several days, and there's good news for you MUST read
now. Licensing is going to be updated!


[url]http://www.flashcomguru.com/index.cfm/2005/11/19/Update-on-Flash-Media-Server-2-[/url]
Licensing

[George Wang]

Hi guys,
I'm also notice this several days, and there's good news for you MUST read
now. Licensing is going to be updated!


[url]http://www.flashcomguru.com/index.cfm/2005/11/19/Update-on-Flash-Media-Server-2-[/url]
Licensing

[jammin_jamaican]

Originally posted by: George Wang
Hi guys,

I also worried this several days, and there's good news for you MUST read now.
Licensing is going to be updated!


[url]http://www.flashcomguru.com/index.cfm/2005/11/19/Update-on-Flash-Media-Server-2-[/url]
Licensing

Ok, that's MUCH better. Although, it would be nice if they had an entry-level
option that could be upgraded, but it looks like we'll end up shelling out the
$4500.

[turtle7898]

no official news from macromedia !

+ the macromedia distributor's and resellers are not informed about this
unoficial news and are still selling it without the warranty of 2500
connections.

How is this possible ? Did u call that the "Professionnal" edition. Can
Macromedia be a little more professional and inform their customers.
I cannot base my plan on unofficial things.

Swolkoff doesnt seem to check his email... Maybe he is fired ? Who knows...

[turtle7898]

I also wan to notice that the macromedia resellers and distributors were not
informed about Flash Media 2 !

"Oh let me see... it looks like it has been renamed... oh yes the product is
now
called Flash Media 2"

Waw that sounds so ridiculous for me. We call the the Information Technology,
Great !

[George Wang]

No worry sir, changes will happen. Just wait.

Originally posted by: turtle7898
I also wan to notice that the macromedia resellers and distributors were not
informed about Flash Media 2 !

"Oh let me see... it looks like it has been renamed... oh yes the product is
now
called Flash Media 2"

Waw that sounds so ridiculous for me. We call the the Information Technology,
Great !

[dejayfx]

at least there's some good news on the licensing...