My wife and I were walking through a mall over the weekend and I reminded her (probably for the 50th time) that I once worked at Software Boutique in that particular mall and that the company used to sell the Netscape Navigator browser on disks for about 20 bucks. That was back in the mid 90s, when the only free software (that wasn’t open source) came in the form of AOL CDs. You wanted software (again, that wasn’t open source), you paid for it. Yes, there were shareware programs available, but most of the time those programs were nothing more than limited samples or apps like Winamp.
Consumers understood this model. They knew (or assumed) companies worked hard to produce software and, to that end, they helped to keep the lights on for those companies by purchasing software.
That was then…
And then, around 1999, something really cool happened. A company, called Loki Entertainment, came out with Linux ports of popular games. I remember playing the Myth II: Soulblighter game for the first time on the Linux platform and it was wonderful. I purchased every one of their games–even those I wouldn’t play–just to help the cause. But it wasn’t enough. You see, Linux users were already accustomed to having all the software they needed for free. So why would they bother paying for games?
Because of that (and a terrible miscalculation with Quake III: Arena), Loki Entertainment went under and there were no more Linux ports of popular games. This was a blow to the Linux community, as it was a certainty that, along with playable games, world domination for the desktop would soon follow. Unfortunately, the people’s dollar had spoken and it wasn’t meant to be.
Fast forward to today and the consumer has been retrained. Thanks to the advent of the smartphone and app stores, users have forced developers into what I call a “race to zero.” That is, most consumers are willing to pay zero for the software they use and developers have to respond to that by giving their work away for free.
And why not? Most of the apps on the app stores are free–so the precedent was set. Unfortunately, as we have seen with other models, that creates a deluge of really bad software. We’re talking apps that are poorly designed, poorly coded, poorly executed. This has also done a great job of enabling malware. Since there is so much software for free, people aren’t hesitant (even when you warn them to be) to load up apps, willy nilly, on their devices.
It’s free! Why not?
But here’s the thing, something every consumer must understand. Developers, companies, and individuals all work very hard creating those applications. In some cases, we’re talking startup companies attempting to live the dream by making a living at doing what they love. When the consumer refuses to pay for software, it’s not only a slap in the face to developers, it’s also a threat to their livelihood.
This very same model is occurring in other markets. Books, music, movies–they’re all suffering from this same race to zero.
And yes, there are other ways for developers to make a buck. Placing advertising in their applications can help them create a revenue stream where there once wasn’t one. Advertising dollars (at least on the app front) can actually generate a decent income. According to Emarketer, mobile ad spending is expected to increase from about $9.6 billion in 2013 to $35.6 billion in 2017, when it will exceed spending on desktop ads for the first time. But those ads only work if consumers are actually using those apps regularly.
Developers understand this. In fact, in today’s market, developers know they can make more money with free apps that include advertising, versus selling paid apps. Why? Consumers aren’t buying apps. And yet, consumers have grown tired of seeing advertisement within apps, which is why app blockers have become so popular.
A lose-lose scenario
Where is the breaking point for this lose-lose scenario? When developers have to include advertisements in their apps (to keep the lights on) and consumers go out of their way to block said advertisements? The ideal end game would be consumers leaving behind the modern mindset and returning back to that period where most software had a price tag. I’m not saying we go back to a time when a browser cost the consumer $19.99; but a price range of a buck to five bucks sounds pretty reasonable–especially considering how much we use/depend upon that software.
I also understand there are so many moving pieces to this machine–but, in the end, if developers are going to continue to do what they do (especially within the mobile landscape), they must be able to turn a profit for their work. Otherwise, what is the justification for spending all that time bringing their brilliant idea to life?
The easiest “immediate” solution
There is patch that can be applied to this situation, one that will help a bit…for now. Consumers, I would say this: If you find a free app you like, one that includes in-app purchases for added features or to get rid of advertisement, pay that particular piper. Get in the habit of shelling out a cool buck or two to the developer of the app you use every day to let them know you appreciate their work. Hopefully you contribution will help that developer eat a sandwich that day.