Fallacy of Savings

Posted by on June 19, 2014 6:14 pm
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Categories: Opinion Technology

Adobe Creative Cloud 2014 Logo

Adobe Creative Cloud 2014 Logo

Adobe released their new Creative Cloud 2014 software today, using subscription based service. One of the draws to the software is that there is no large one-time fee associated with it. Rather, as long as you pay, you get the service, thereby saving money. But let me lay out the fallacy of this savings.

The other day I went into a gas station, I was thirsty and could use a snack. I grabbed some peanuts for 59 cents, when I got to the register, the cashier offered that I get two for one dollar. I said no, that’s ok, but he still charged me a dollar and gave me two bags of peanuts. I told him I didn’t want them, but by that point I didn’t care and just swiped my card. He said that I was in fact saving money by buying two. I rebutted, “No, I’m actually spending 41 cents more, I’m saving nothing.”

This logic is often applied to retail stores, especially in buy one get one free deals. The unfortunate thing when it comes to food however, is that it increases consumption which over time leads to weight gain, wholly undesirable. I’ve heard in the past of people spending over $100 at Kohl’s. But, they say, I saved $200! No, I inform them, you never spent that $200, never planned on spending it, there was no savings, you merely spent $100. See savings, in financial terms, is money that you would have spent, but for one reason or another were able to not spend that money, thus saving it for another time.

Now back to Adobe’s software, and they are not alone, Microsoft and Apple both have subscription based products now. In 2013, Adobe launched their creative cloud service, discontinuing their perpetual licenses and only renting out their software. For me, I jumped on the bandwagon, I had my qualms, but I got a special upgrade price so it made sense. There has been what many would call a savings, if Adobe had released a Creative Suite 7, instead of Creative Cloud, it would have cost anywhere from around $1,200 to upgrade and $2,500 as a stand alone package. But, Adobe didn’t, therefore I never planned on spending that money, and thus, no savings.

A hit to the model of subscription based software is that you must pay in order to use it. Say today my bill to Adobe was due, if I didn’t pay it, I would have 30 days to pay it or my software would stop working. Kaput, I’m out of the game. So, while I’m not spending as much as I did for Adobe Creative Suite 5.5, I no longer have the peace of mind that I own the software, and don’t have to worry about it.

Furthermore, one of Adobe’s promises was that they wouldn’t release new software, that the existing programs would be updated continuously and you’d never have to install again. Well, this turned out to be false as well. Today, as I went to download the new updates, I found that instead I had 14 new programs to install. Using an SSD with limited space, this presents an issue and will require me to uninstall the “always-updated” software from last year. Adobe also had an issue recently where their servers were down worldwide for over 48 hours. No one could access updates, stored online media, or install the software on a new machine.