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Autodesk Introduces New Software, Emphasizing Cloud Offerings

03/27/2012 | 05:37pm US/Eastern

--New software makes easier connections to company's cloud offerings

--Company expects cloud offerings to grow, but hasn't yet factored into guidance

--Company expects margins to grow over time

(Updated to add new details in sixth paragraph.)

   By Ian Sherr 

Design software maker Autodesk Inc. (>> Autodesk, Inc.) announced several new products Tuesday with increasing emphasis on Internet-based projects and its cloud-computing platform.

Autodesk said its new design software would be easier to use, and would work more seamlessly with its "Autodesk 360" cloud computing products, which offers a way to store and share documents as well as work out complex tasks using Autodesk's fast servers rather than the customer's computer.

Carl Bass, Autodesk's chief executive, said his company's cloud products have been well-received by customers since launching last year. For example, Bass said, more than 300,000 documents per week had been uploaded to the company's "AutoCAD WS" software service for mobile devices, such as Apple Inc.'s (>> Apple Inc.) iPad and tablets made using Google Inc.'s (GOOG) Android operating system. Millions more have downloaded Autodesk's other applications for drawing and sketching as well, the company said.

"The response has been overwhelmingly popular," Bass said during an event in San Francisco.

The latest products from the San Rafael, Calif., software company are part of a larger effort to move customers toward Autodesk's cloud services, and the recurring subscription revenues that come with it. Nearly half of the company's $2.2 billion in revenue last year came from subscriptions, Bass added, and that number will likely continue to climb.

Bass said one feature of his company's new software offerings will allow customers to click a button and either store their work to Autodesk 360 or use the company's cloud to perform complex computations, such as creating photo-realistic images or a detailed model of a city. Autodesk's service is primarily run on its own servers, but it uses Amazon.com Inc.'s (>> Amazon.com, Inc.) cloud products to handle sudden surges in demand.

By moving to a subscription-based revenue stream and pushing tools online, Bass said Autodesk also will be able to continually refine its products as customers access them, rather than releasing software at regular intervals. He added that the company's expectations of expanding sales at least 10% this year doesn't include potential gains from the company's cloud products.

The cloud also offers Autodesk an opportunity to expand its margins, Bass said in an interview with Dow Jones Newswires. "The marginal cost of additional software and services is low," he said. "As our business grows it becomes more profitable."

And despite offering some of its newer products free for tablet computers, for example, Bass said that as customers' needs grow and their projects become more advanced, they will likely seek out the company's other offerings, lifting overall sales.

"The fundamental strategy is to grow as big and broadly as possible," he said. "If we serve a greater number of people, we run a better business."

Autodesk shares, which have risen more than 39% since the beginning of this year, were up 0.4% at $42.37 in after-hours trading.

-By Ian Sherr, Dow Jones Newswires; 415-439-6455; ian.sherr@dowjones.com

Stocks mentioned in the article : Autodesk, Inc., Apple Inc., Amazon.com, Inc.
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