Quote - But on the other hand, maybe one of the goals of giving away DS4 Pro (aside from trying to keep their vendors on the Genesis bandwagon) is to build up a customer base for DS5, which will not be a free upgrade.

Not to disagree with you, as you may very well be right, but I've given that angle some thought.   It is, of course, a common and successful  method to building up customer base by lowering or giving away the current version of a piece of software.   However, this is more commonly done at the end of a version's life, not the beginning (DS4 had been in market less than 6 months.)   Given that major versions of DS have been running longer than the industry average of 18 months, this would be massively deferring software revenues unless they were speeding up the development cycle so that they could start recouping that investment in six to nine months.   More than that, and you risk the base melting away as maintenace the current version is defferred into the new release.

Given the bug level and lack of attention to the bugs in DS4, (as well as documentation), I'm not sure the investment in the software supports a thesis that DAZ is accelerating the development cycle so they can see a release so soon (such as this fall.)  I'm pretty sure (from a financial calculus) that this is "give-them-the-core-and-sell-them-the-options" play, where the main option is content.

Of course, DAZ isn't saying.   I do know that they will face an uphill on DS5 as a paid upgrade if it doesn't contain some pretty astounding technology that users can't live without.   The history of the hobby 3D market tends to show that customers really lag in upgrading as long as their current product and system work well.  This would make a "give you 4 now, buy 5 strategy" even more problematic from a revenue standpoint.

Based on DAZ past public statements about Genesis and DS4, I suspect this play will work for them as long as 1) The free content availablity remains small  2) Other content outlets keep pace with DAZ's pricing model  and 3) Alternative core figures such as V4WM, M4WM, etc. don't absorb other segments of the market.

My reasoning goes like this.   Free content, is of course a threat, since content sales will need to sustain DAZ's core business in the absense of any software revenues.  Other content outlets also threaten their model as a purchase at another site does not generate any revenue to support innovation in DS.   If these other outlets also keep price down (by compressing their broker fee's, for example) then the new users might seek them out, even if not of the same quality.   (This is a well documentated effect of "free" software--it compresses what people are willing to pay to add accessories/options to that software.)   The last, element is what hapens with the "base" of V4/M4/K4 users.   If the alternatives of staying with their current investments work, or other products come onto the market at a lower price-point than the Genesis purchases, then revenue in that core base may be turned away from DAZ and further reduce revenues to invest in further development of DS.

To me, it looks like DAZ is swinging for the fences.   If they can lock enough new users into the Genesis/DS4 system, then they will have a strong financial stream to continue to a DS5 and make other strategic investments.   If they cannot sustain the core, and it disspates to other vendors and technologies, they have virtually no direct revenues for the DS software to fall back on as they have convinced the market that correct price is "Free."

-K