How Adobe cracked the software-as-a-service model


Five years ago, Adobe made less than 5% of its revenue from subscriptions. Its announcement that it would shift its major products such as Photoshop to a subscription basis caused a near rebellion amongst users and hurt revenues. Chief Financial Officer Mark Garrett tells BloombergBusinessweek that it was a “burn the boats” strategy with no option for retreat, but the company saw it as necessary because the recession had wrecked years of sales. To entice customers, Adobe also made the cloud service unique and powerful. Today, subscriptions constitute 80% of sales, revenues are up 44%, and new customers are flocking in, Rob Walker reports.

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