The $47 billion Australian tech giant Atlassian plans to stop selling new licenses for its Server product lineup as soon as February, with plans to stop supporting those products entirely by February 2024, as its cloud strategy marches forward.
"We're really excited to help our customers migrate to the cloud," Atlassian co-CEO and cofounder Scott Farquhar told Business Insider. "The cloud is the natural future. This is really in line with our customers."
Atlassian, founded in 2002, plays a vital role in the software industry. Jira, its flagship product, is an industry-standard way for developers to track bugs and other issues, while Confluence is a sort of corporate Wikipedia that helps keep knowledge all in one place.
In more recent years, the company has undergone an important shift. While its products can still be installed on private servers and in data centers, it has recently been shifting to a cloud-focused model that emphasizes the cost and productivity benefits of allowing Atlassian to host the software itself.
Notably, and a bit confusingly, the end of Atlassian's Server lineup doesn't mean that the company is ending the ability to host its software on your own servers entirely. The company will still maintain its Data Center product line, which is custom-tailored for larger enterprise customers, offering advanced features above those of Server.
Ultimately, the move marks a major milestone in Atlassian's cloud-first strategy. Farquhar said he expected the "vast majority" of its Server customers to make the jump to the cloud in the wake of this decision and that those who don't would upgrade to the Data Center line.
By February 2024, Atlassian will stop supporting its Server products
The company said it would stop selling new licenses for its server-based software by February 2 and cease developing new features for those products on the same date.
Existing customers will have a three-year window during which they can renew or upgrade their Atlassian server licenses, but the company is instituting a price hike on any such purchases, effective on the same day in February. (Atlassian notes it has instituted regular price hikes on these products for a long time now and that this change is in line with the preestablished trend).
By May, Atlassian will stop accepting new apps into its marketplace that rely on integrating with its server products. In February 2023, customers will lose the ability to purchase those sorts of apps entirely. Customers will no longer be able to upgrade and downgrade its server products by February 2022. Ultimately, by February 2, 2024, Atlassian plans to stop supporting its server products altogether, regardless of when they were purchased.
"It gives customers a long time of maintenance support where we provide support and bug fixes for our products," Farquhar said. "The overwhelming majority of our customers are choosing cloud. All the customers on the server have plans to move to the cloud. This is working in tandem with our customers."
To that point, Atlassian said the majority of its customers were already using its cloud products and that 90% of its new customers opt for the cloud too. In fact, Atlassian Chief Revenue Officer Cameron Deatsch said the cloud business was growing faster than its legacy businesses ever did and that the Server lineup accounted for a minority of customers.
Deatsch said Atlassian was doing what it could to make the transition as smooth as possible. The company plans to reach out to the largest Server customers about transitioning to the cloud versions and will offer migration tools, free trials, and various discounts to cushion any concerns. Ultimately, Deatsch said, Atlassian believes this is the right thing to do for customers and the company alike.
"We believe with effectively 39 months' notice, it's more than enough time for customers to check out our cloud," Deatsch told Business Insider. "We know once customers move to the cloud, they're happier. More importantly, they expand the usage of our products."
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