Autodesk 2008 Annual Report Download - page 86

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DEVELOPER PROGRAMS
One of our key strategies is to maintain an open-architecture design of our software products to facilitate
third-party development of complementary products and industry-specific software solutions. This approach
enables customers and third parties to customize solutions for a wide variety of highly specific uses. We offer
several programs that provide marketing, sales, technical support and programming tools to developers who
develop add-on applications for our products. Over 3,100 developers in the Autodesk Developer Network create
interoperable products that further enhance the range of integrated solutions available to our customers.
BACKLOG
We typically ship products shortly after receipt of an order, which is common in the software industry. Our
aggregate backlog is primarily comprised of deferred revenue. Deferred revenue consists primarily of deferred
maintenance revenue from our Subscription Program. To a lesser extent, deferred revenue consists of deferred
license and other revenue derived from Autodesk Buzzsaw and Autodesk Constructware, consulting services and
deferred license sales. Backlog also includes current software license product orders which have not yet shipped.
The category of current software license product orders which we have not yet shipped consists of orders from
customers with approved credit status for currently available license software products and may include both
orders with current ship dates and orders with ship dates beyond the current fiscal period.
Aggregate backlog was $521.5 million at January 31, 2008, of which $506.1 million was deferred revenue
and $15.4 million related to current software license product orders which had not yet shipped at the end of the
fiscal year. Aggregate backlog was $395.8 million at January 31, 2007, of which $378.8 million was deferred
revenue and $17.0 million related to current software license product orders which had not yet shipped at the end
of the fiscal year. Deferred revenue increased over the prior year primarily due to an increase in deferred
maintenance revenue resulting from the success of our Subscription Program. We expect deferred maintenance
revenue to continue to increase in the future. We do not believe that aggregate backlog as of any particular date is
necessarily indicative of future results.
COMPETITION
The markets for our products are highly competitive and subject to rapid change. We strive to increase our
competitive separation by investing in research and development allowing us to bring new products to market
and create exciting new versions of existing products that offer compelling efficiencies for our customers. We
also compete through investments in marketing and sales.
Our Design Solutions Segment competes with vendors that specialize primarily in one of the three industry
segments in which we compete. Our competitors range from large, global, publicly traded companies to small,
geographically focused firms. Our primary global competitors in this segment include Adobe Systems Inc.,
Bentley Systems, Inc., Dassault Systemes and its subsidiary SolidWorks Corporation, Environmental Systems
Research Institute, Inc. (ESRI), Intergraph Corporation, Nemetschek AG, Parametric Technology Corporation,
and Siemens AG PLM software division.
Our Media and Entertainment Segment competes with a wide range of different companies from large
global publicly-traded corporations to small private entities. Large organizations that produce products that
compete in some or all of our markets include Adobe Systems Inc., Apple Computer Inc., Avid Technology,
SONY and Thomson. The media and entertainment market is highly fragmented with complex interdependencies
between many of the larger corporations. As a result, some of our competitors also own subsidiaries that are our
customers or our partners in developing or bringing to market some of our solutions.
The software industry has limited barriers to entry, and the availability of computing power with continually
expanding performance at progressively lower prices contributes to the ease of market entry. The design software
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