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Ron Wilson

Altium cuts prices on their design tool, creating an interesting IP pricing play

April 20, 2009

The folks at Altium have spent some time now pitching their unique idea for electronics system design: a top-down, drag’n'drop approach that offers the user a huge pool of processor, function, and connectivity IP and software, which the Altium Designer tool assembles into a waiting FPGA more or less before your eyes. By dealing with the mechanics of implementing a platform more or less automatically, the Altium folks claim, they free designers to concentrate on the functional blocks that actually differentiate the design. Once the design is working on Altium’s FPGA-based target board, the NanoBoard, there is a direct path to a manufacturable PCB design.

This week Altium, in a further effort to proselytize their idea, announced a rather drastic price cut for several forms of their tool license. For the first time the company is offering an individual license for $195 US per month on a 12-month contract. A single-user perpetual license now costs $3995, including one year of support. After the first year the support charge is $1500 annually per license. The cost of the NanoBoard has also dropped from $2500 to $1995.

This certainly lowers the entry fee for this style of design. Altium product manager Rob Irwin commented that this fee structure was closer to the license fees users expect for FPGA or embedded software tools than what ASIC designers, for instance, might expect.

But the new fee structure seems to have another implication as well. Part of what makes Altium Designer special is the extensive menu of IP in the design environment. This IP gets included in anything you design with Designer, and is royalty-free. So if you license Designer and use it to create a design, you in effect have a perpetual royalty-free license to use the IP in that design.

That makes the $2340 you would pay for a year’s license fees, or even the $3995 for a perpetual license, a very cost-effective way to get access to a lot of valuable IP, including a 32-bit RISC core, a number of connectivity solutions, and so forth. It might be an interesting approach for a low-budget design, independent of how you feel about the underlying methodology.

Posted by Ron Wilson on April 20, 2009 | Comments (10)

June 23, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Don Prescott commented:

Clearly there is a major reason behind a company suddenly dropping the price of their product by 63% from $11,000 to $3995. It has to be treated with great suspicion when the company in question attempts to explain it as some kind of enlightened move. The true reasons behind Altium's strange decision are quite probably known unto to a few board members. I have recently heard another quite plausible explanation which I won't share here. I'm now waiting until Altium announce their 2008/2009 numbers then see what happens next....and I think something will. Unlike you I regard Russo's departure as highly significant, coming only a few days after the price changes, plus there's been no announcement whatsoever on Russo's departure by Altium. Don't you think this is kinda odd...?

June 10, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
William Kitchen commented:

It is more than a slight stretch to describe a change in the proportion between two prices as a price increase when clearly both prices have fallen. There are legitimate criticism's that can be made against Altium, but this is not one of them. As for Russo's departure, I have no knowledge of why that happened, or what effect it will have. To read anything into it would be pure speculation.

May 13, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Don Prescott commented:

If the product is priced at $3995 and the annual maintenance is $1500 that makes a whacking 37.5% annual maintenance charge...... I was also told today that Emma Lo Russo, the President of Altium was gone. On her personal webpage she describes herself as "Formally President of Altium Limited". This must have been quite recent. There's no announcement on this from Altium that I can find.... so, what do you read into that...?

May 13, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Don Prescott commented:

May 6, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
William Kitchen commented:

Don, The maintenance costs are stated on Altium's web site and in the article above. The annual maintenance for the full suite perpetual license is several hundred less than it was before. Your definitions of "enormous hike" and "conveniently removed mentioning" must be different from mine.

April 28, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Bill Steverson commented:

On that note, I am going to trade in my Lexus for a Ford Fusion.

April 23, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Don Prescott commented:

With the Altium end of year at the end of June I think this is much more about trying to avoid a repeat of last year''s loss making situation ($2.5M) than some kind of "revolution". Initially they announced the new prices plus the enormous hike in ongoing maintenance costs, now they have conveniently removed mentioning the maintenance costs, due I''m sure to the waves of protests from aghast Altium users. All Altium have done is reduced the purchase price and moved it cost of ownership.

April 22, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Dominic commented:

Sounds like a desperate move if you ask me. Maybe some day Wal-Mart will handle the sales for Altium.

April 22, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Plamen commented:

Only problem is that Altium''s approach is way ahead of its time and the majority of designers that I''ve met see their tool as schematic entry and PCB layout mainly. Very few seem to appreciate the enormous capabilities of taking their design and squeezing it into an FPGA or even designing directly in logical modules. (It seems too good to be true.) What''s more, you''re not tied to an FPGA supplier. If you can''t get stock, just recompile your design for what you can get! (For what it''s worth, I have no connection to Altium except being a happy user for many years :-) plamen at xyber.com.au

April 21, 2009

In response to: Altium cuts prices on their design tool, creating an interesting IP pricing play
Daniel Payne commented:

It''s a breath of fresh air when an EDA supplier actually published their pricing and packaging. Kudos to Altium for so plainly stating their pricing on Altium Designer and NanoBoard. Now if only the big four EDA companies would follow suit and tell us their pricing in each press release.

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