EarningsIt’s not even 8AM and there’s already lots of news, so let’s get right to it.

Adobe announced late Monday that it will no longer sell its Creative Suite software and focus instead on its $50/month Creative Cloud and other subscription plans.

Scott Morris, senior director of product marketing for Creative Cloud at Adobe told CNET, “We have no current plans to release another perpetual release of the CS tools and suites. Creative Cloud is going to be our sole focus moving forward.”

This isn’t a shocker. Adobe launched Creative Cloud last year and believes its customers prefer the more frequent product updates, the smaller initial investment of a subscription and the flexibility of variable-term commitments. Moving to subscriptions was Adobe plan all along since it creates a ratable business; no big up-front deals, but a nice, steady, predictable revenue stream.

What is surprising –and what the engineering software world will do well to pay attention to– is the reaction to this move among Adobe customers. Immediately, people began tweeting, blogging and commenting that this is Adobe-on-the-cloud and how difficult it will be to work with large Photoshop files while transferring data to and from the Internet. And what happens if the Internet connection goes down??

That’s not it. At all. This is a licensing model change. Users will need to connect online periodically to let Adobe confirm that access is still allowed but the software will live locally. Users need to figure out their break-even point to see if a subscription is more affordable to them than a perpetual buy (they’re usually even at around 3 years but Adobe has so many deals and discounts that YMMV). Some may decide that the break-even isn’t to their advantage and look at Corel, Quark and other competing solutions.

The lesson: vendors need to better articulate what these changes mean to users. Adobe certainly created confusion naming this whole thing “Cloud” and buries statements like “creatives will be set up to download and use these latest cloud-enabled innovations from Adobe“(my emphasis) in the middle of press releases. It may also have been better to let the perpetual model die a natural death by boosting the financial incentives for the subscriptions. Adobe needed to be further ahead of this story than it apparently was.

In completely unrelated news, Dassault Systèmes today announced that it acquired SIMPOE, maker of plastic injection molding simulation software, a long-time partner and the technology behind SolidWorks Plastics. The DS press release says that SIMPOE has more than 3,000 active users. Transaction details were not disclosed, but I don’t believe SIMPOE was large enough to move the needle of DS’ revenue.

Simpoe-Mold is the company’s stand-alone plastic injection simulation solution but the company is also a gold-level partner for non-DS brands like PTC’s Creo and Siemens’ SolidEdge. I’ve asked for clarification, but believe that DS’ general policy is to leave these products intact. It is then up to DS’ competitors to decide whether they want to grant partner status to a DS company. I’ll update if warranted.

Wonder what the rest of the day will bring?