Autodesk 2011 Annual Report Download - page 97

In addition to the competitive advantages afforded by our technology, our large global network of
distributors, resellers, third-party developers, customers, educational institutions, faculty and students is a key
competitive advantage. This network of relationships provides us with a broad and deep reach into volume
markets around the world. Our distributor and reseller network is extensive and provides our customers with the
resources to purchase, deploy, learn, and support our products quickly and easily. We have a significant number
of registered third-party developers who create products that work well with Autodesk products and extend them
for a variety of specialized applications. Users fluent in our products are broadly and globally available from
educational institutions and in the existing workforce. We offer extensive educational programs, including
student versions of software, curricula, and faculty development. We have an extensive global community of
students who are fluent in our software and poised to become the next generation of professional users – thus
reducing the cost of training and providing fresh talent for our customers. Our global network of distributors,
resellers, third party developers, customers, educational institutions and students has been developed over our
twenty-eight year history. We believe it is an enduring competitive advantage that is difficult for others to
replicate.
Our growth strategy includes continually increasing the business value of our design tools to our customers
in a number of ways. First, we seek to address an increasing portion of our customers’ workflow with products
that extend the value of our customers’ digital design information into visualization, analysis, and simulation.
Second, we extend our customers’ workflow with products for adjacent users and for the “customers of our
customers,” thus increasing the value of the design information our customers produce. Third, we seek to
improve our product interoperability and usability, thus improving our customers’ productivity and effectiveness.
Fourth, we develop new ways to deliver capability and value to our customers, such as product suites,
software-as-a-service, mobile devices, and new hardware platforms. Notably, in October 2010, we released
AutoCAD for the Mac, reaching a large base of native Mac environment customers. Finally, we have developed
a new line of consumer products for the Web, iPad, and mobile devices that provide our advanced visualization
technologies to consumers—a whole new category of Autodesk customer.
A number of our customers use our horizontal design products, AutoCAD and AutoCAD LT. We also
develop a large number of vertical model-based design products. We believe that expanding our horizontal
design product customers’ portfolios to include our vertical design products and our model based design
products, and now our suites, presents a meaningful growth opportunity and is an important part of our overall
strategy. For fiscal 2011, revenue from model-based design products increased 18% as compared to the prior
fiscal year and as a percentage of revenue, increased to 30% in fiscal 2011 as compared to 29% in fiscal 2010.
For fiscal 2011, revenue from Suites increased 26%, as compared to the prior fiscal year, and as a percentage of
revenue increased to 23% in fiscal 2011 as compared to 20% in fiscal 2010. We believe that the adoption of
vertical design products and model-based design products by our customers in all industries will increase their
productivity and the value of their design data.
Expanding our geographic coverage is another key element of our growth strategy. While emerging markets
are important for all global businesses, we believe they hold special opportunity for Autodesk. Much of the
growth in the world’s construction and manufacturing is happening in emerging markets. Further, emerging
markets face many of the challenges that our design technology can help address, for example infrastructure
build-out. We believe that emerging economies continue to present long-term growth opportunities for us and
revenue from emerging countries increased 17% during fiscal 2011 as compared to fiscal 2010. Revenue from
emerging countries represented 15% of both fiscal 2011 and fiscal 2010 net revenue. While we believe there are
long-term growth opportunities in emerging economies, conducting business in these countries presents
significant challenges, including economic volatility, geopolitical risk, local competition, intellectual property
protection, poorly developed business infrastructure, scarcity of talent and software piracy.
Our strategy includes improving our product functionality and expanding our product offerings through
internal development as well as through the acquisition of products, technology and businesses. Acquisitions
often increase the speed at which we can deliver product functionality to our customers; however, they entail cost
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