Chapter 446 Tuor Is Anxious

United States, Office of Chairman of Tuo Corporation.

"Kelen, what is going on in the Chinese market? What is that Huaxia CAD doing!"

President Kwick threw a piece of material on the table and asked Marketing Director Curran with wide eyes.

Tuao Company did not pay too much attention to the open source issue of Huaxia CAD at the beginning. Compared with Tuao, the strength of New Jingwei Company is not worth mentioning at all. Huaxia CAD has a place in the Chinese market, but it has basically no presence in the international market. Tuo Company does not think it is qualified to become its competitor at all.

Nowadays, there are several open source CAD software in the Western market, but they are not popular. Only a few developers use these open source CAD for design, and their motivation is mainly for curiosity. The functions of this type of open source CAD are very thin and cannot be compared with commercial versions of CAD.

When Huaxia CAD announced that it was open source, the marketing department of Tuao Company conducted an evaluation and concluded that New Jingwei Company may have felt that it was unable to compete with Tuao Company, so it chose such a method to withdraw from the market. The marketing department also believed that New Jingwei Company had a certain motive for venting its anger, and wanted to use this method to hit Tuao's sales. Well, it actually doesn't hit him much. At most, it just makes Tuor sick.

But what happened next made Tuo Company have to be vigilant. According to a report from Tuo China Company, after Huaxia CAD became open source, China's Ministry of Education, Ministry of Technology and other major ministries jointly issued a notice requiring developers from universities, scientific research institutes and industrial enterprises to write applications for Huaxia CAD and implement Participants promised various preferential terms.

Driven by the policy, universities and research institutes across China have launched an upsurge in writing applications for Huaxia CAD. In just over a month, tens of thousands of open source application modules have been uploaded to the official website of Huaxia CAD. indivual. The staff of New Jingwei Company tested these modules day and night, and the junk modules accounted for more than 80% of the total. But even so, there are thousands of useful modules left, which makes people dizzy.

A few days ago, an old customer of Tuo came to contact us, hoping that Tuo could develop a special module for them to calculate the geometry of the cutting edge of the hobbing machine's milling disc. Tuao Company quoted the price according to the general standards, but the other party claimed that it needed to consider it, but in the end, there was no news about it.

The marketing department of Tuo Company called the other party to ask if the other party still had purchase intentions, but received shocking news: the other party had given up its plan to order this module from Tuo Company and switched to Huaxia CAD.

The marketing department staff inquired in detail and found out that the other party had accidentally discovered that there was a module in the open source resources of Huaxia CAD that could meet their needs. With the mentality of giving it a try, they downloaded Huaxia CAD and the special module. After running it, the results were good and the cutting edge geometry was successfully calculated at almost zero cost.

In fact, the model for calculating the cutting edge geometry is public, and it is not difficult to convert it into a program. Some companies can also develop such programs themselves. The price Tuao quoted to that customer was high because of the need to maintain the entire product price system, and the actual investment was not much.

In the absence of open source software, if machinery companies wanted to order such modules from software companies, they would have to pay high fees, otherwise they would have to write the code themselves. Now with the open source platform Huaxia CAD, some companies directly upload the codes they have written in the past for use by colleagues who lack development capabilities.

These companies that upload codes have no financial demands. They simply feel that they have written the code and there is no harm in sharing it with their peers. This is just like some students in college who took a lot of notes during class and sent them directly to the class group to share with their classmates before the exam. This is just a matter of effort.

But this little effort ruined Tuor's good business. Tuo Company used to make money from this kind of development. Now people can find it for free online. Who else is willing to pay Tuo Company?

Open source software also has an advantage that commercial software does not have, that is, after users download the open source software, they can modify the software according to their own needs. For example, the customer above downloaded the open source cutting edge geometry calculation software and adjusted some parameters based on the needs of his company, achieving some unexpected effects. This is using commercial software. A convenience that is hard to come by.

After the customer got this advantage, he began to spread the experience in his own circle. Subsequently, several companies that were preparing to order software from Tuo withdrew their orders, claiming to have obtained other solutions. Tuao's marketing department asked someone to inquire and found that these so-called solutions were actually open source resources on the official website of Huaxia CAD.

"If this continues, at least half of our business will be lost!"

Kwick shouted to Curran. I originally thought that Huaxia CAD's switch to open source was just a farce made by children out of anger. Who would have thought that it would actually affect Tuo's core business. The customer did not take a fancy to Huaxia CAD itself, but took a fancy to the open source resources provided by peripheral developers. This is really a terrible thing.

"We have also received feedback from some customers. They think that our charges for customized projects in the past are too high. We charge hundreds of thousands of dollars in development fees for modules that others can provide for free. Customers said it is difficult for them to Accept." Curran reported timidly.

Reporting something like this when Kvik was losing his temper would definitely add fuel to the fire. But Curran had to report it, because Kwick would know about it sooner or later, and Curran would inevitably be held responsible for not reporting the matter.

"Nonsense, if we don't charge such a high development fee, how can we have the funds to keep the software updated? Why didn't they say it was too cheap when they bought CAD?" Kvik was really angry and threw things on the table. Gotta snap.

As early as 10 years ago, Tang Zifeng discussed this issue with Li Kejia. Tuao Company condoned piracy in the Chinese market, seemingly losing genuine sales revenue, but in fact it was cultivating users' usage habits so that they could benefit from customized services in the future. Charge high returns.

The selling price of Tuo CAD is very expensive from the perspective of Chinese users, but considering the salary level of software engineers in Western countries, such a price is not enough for Tuo Company to make huge profits, and the software sales revenue is at best only Just be able to maintain the company's daily operations.

Tuao's main profit comes from customizing functional modules for customers. Some functional modules are actually very simple, but if customers do not know the source code of Tuo CAD, they cannot develop it themselves, or they can only use other systems to develop a program, calculate the results, and then import them into Tuo CAD. This is undoubtedly It's very troublesome.

In order to improve design efficiency, some companies can only ask Tuao Company to help develop some special modules. Tuao Company charges tens of thousands, hundreds of thousands or even millions depending on the development difficulty of the module. For those large enterprises, such expenditures are also affordable.

By the way, these machinery companies themselves are also doing this kind of business. They sell equipment to customers at low prices, but they can charge hundreds or thousands of dollars for any spare parts. It is impossible for customers to manufacture these spare parts themselves, so they can only accept blackmail from manufacturers.

Further downstream, companies that have purchased machinery and equipment produce consumer goods that follow this pattern. A mobile phone costs 3,000 yuan, and replacing a screen costs 1,500 yuan. Don’t you have to hold your nose and admit it?

But now, a disruptor has appeared on the market, claiming that there are a large number of free mobile phone screens available, and if the screen they provide is inconsistent with your mobile phone model, you can just use scissors to trim it and install it. With such benefits, who would go to a specialty store to replace a 1,500 yuan screen?

"This New Jingwei Company seems to be Tuao's so-called strategic partner in the Chinese market, right? It was you who facilitated this matter, right?"

Kwick stared at Curran and remembered an old incident.

Tuao Company has many strategic partners. They all claim this externally, but there are distinctions within the company. Some strategic partners are real and have a close relationship with Tuo Company. To a certain extent, it can be said that both lose and prosper. Other strategic partners are basically just words. The reason for mutual recognition between the two parties is just for some public relations needs, and there is not much actual business relationship.

The strategic cooperation agreement signed between Tuao Company and New Jingwei Company was indeed handled by Kelun, but it was Tuao's Chinese branch who proposed the plan. The reason why Tuao China Company proposed to cooperate with New Jingwei Company was that Huaxia CAD was conquering the Chinese market at that time and squeezing Tuao's market share.

Tuo China Company believes that it might as well take a step back to advance, and mutually authorize interface styles and recognize file formats with Huaxia CAD. In this way, users of Huaxia CAD will not find it difficult at all to switch to Tuo CAD. This is Tuo It has set the stage for CAD to make a comeback one day.

The U.S. headquarters did not conduct a serious evaluation of this idea proposed by Tuao China Company. At that time, the size of the Chinese market was still very inconspicuous, and such a small business scale was not worth the trouble of the company's bosses. The Chinese company submitted a report that looked colorful. Curran took a casual look at it and felt it made sense, so he reported it to the board of directors. The board of directors also paid little attention to this matter and approved it after going through a complete process.

What they never expected was that this incident would actually cause a big surprise for Tuo Company itself, and it was a big surprise.