Atlassian is killing their Server line
On Friday Atlassian announced in a blog post that they are completely killing their standalone, inexpensive Server line of Products. This applies to several of their products, but for now let’s focus on Jira.
Prior to this, you could get an on-premise instance of Jira for as cheap as $10. Pricing above that was relatively cheap. But, as of February 2021, that is no longer the case. The cheapest you will be able to get an on-premise version of Jira will be the 500 user tier of Jira Data Center, at an eye watering price of $42,000/yr. That puts it solidly out of the budget of a lot of small to medium sized startups.
I started my journey as an Atlassian admin a little over 4 years ago. Back then there was Server, Data Center and Cloud versions of Jira. And they were mostly identical. Data Center was primarily a licensing difference, allowing you to deploy to multiple nodes for redundancy and availability, but otherwise identical to Server. Cloud was essentially bleeding edge Server, just hosted on Atlassian’s servers. Sometimes it would have features that hadn’t made their way to the On-Prem versions yet, but would soon enough. But Cloud was not without it’s issues. There were a lot of Add-Ons (no, I’m not calling them Apps, no matter how many times you change the name) that were not available on Cloud. Cloud didn’t scale well. And you were limited on what customizations you could do. Also I don’t think there’s still really a way to set up a proper development environment in Cloud to test changes.
I started out my career working for an Atlassian Partner. We were a small Portland and Seattle based company that helped other companies with their Atlassian products. A BIG part of that for the first year or so was helping people move off of Atlassian Cloud. Companies that started on Cloud, outgrew it, and needed to move to Server were very common.
Now since then Atlassian has dumped a lot of money into Cloud. It has almost become a completely different product than Server, and probably is the best option for a lot of companies. And it clearly makes Atlassian more money, so they’re pushing it hard. But it’s not for everyone.
Killing Server is going to really hurt two groups.
The first is small to medium businesses that can’t justify the expense of Data Center, but Cloud does not work for them. They could rely on Add-Ons that aren’t in Cloud yet. They have custom integrations that won’t work on Cloud. They have regulatory or security concerns that require them to have their data on a server they control, behind a firewall they manage, that they can access without the internet, and in a specific geographical area. This is probably a relatively small chunk of Atlassian’s customers, but they do exist. Those were the kind of customers that helped Atlassian become the giant corporation it is now, and it this move makes it seem like Atlassian no longer cares about them.
The second is Atlassian Partners. When I worked for a Partner, those small to medium companies were our bread and butter. Those were exactly the kind of companies that hired us. Companies on Cloud generally didn’t need our help, at least not as much, and companies on Data Center were usually big enough to hire a dedicated Atlassian admin. Now I’m not saying we didn’t have any Cloud or Data Center customers, but I would bet they were a relatively small part of our customer base. Partners were essential to Atlassian’s growth, Atlassian is famous for “not having sales people”, relying on Partners to “land and expand” and help them grow. Without the Partners Atlassian would not be where it is today, and it seems like that Atlassian is going to completely kill them as a thank you. Without the revenue from small to medium Server customers, most, if not all, Atlassian Partners will go out of business (or at least completely pivot their business model to no longer be Atlassian focused).
My job is safe. I am now an in house admin for one of those large Data Center customers. And, at even the increased Data Center pricing, Jira is an amazing product and it’s still more than worth it to us. But many of my friends, many of the people I used to work with, might not be so lucky.
If Server was a separate product that was costing Atlassian more than it was making them, then this move might make sense. But it’s not. Server is just Data Center with some licensing restrictions. The overhead to keep it alive for Atlassian is basically 0. It’s not like they have to keep a bunch of extra developers on staff to maintain it or anything. This move seems entirely aimed to force customers to options that make Atlassian more money. It’s taking away customer choice for the sake of Atlassian’s bottom line.
It’s clear that Atlassian did the math. They estimate that they will lose $X from customers who move to alternatives, but make $Y from customers who have no choice to move to Cloud or pay more for Data Center, and they are betting that Y will be more than X. I don’t see how this move is motivated by anything more than them trying to increase their profits. Which is really disheartening, as Atlassian is a company that I owe a lot to and I want to really respect. Capitalism rears it’s ugly head again, I guess?
Right now the lowest tier for Jira Data center is 500 users. And at 500 users that works out to a little over $6/mo/user. That’s not THAT much. But there are a lot of companies out there that don’t have close to 500 employees. If Atlassian introduces a few tiers lower than that, then I will stop complaining. But if they don’t, then I don’t see how they can spin this move as anything but a blatant example of putting profits over their customers.
https://www.atlassian.com/company/values
“Don’t #@!% the customer”
Lets hope Atlassian doesn’t forget that and reverses course.
