The Mac App Store Needs Paid Upgrades
blog.wilshipley.com
blog.wilshipley.com
I can't see any way they can get around this problem without adding paid updates.
Until then 3rd party developers are high and dry.
Full price upgrades works for Angry Birds, but anything less episodic or standalone and you have problems. See Tweetie 2, for an example.
This issue is going to be rampant in the Mac App Store very very soon. It's been out for what, a year now? Time for a round of big updates... now you have two copies of all your apps.
What's the example, exactly? Genuinely curious. I upgraded to Tweetie 2 as soon as it came out. My impression was that it was very successful right up until Twitter bought Atebits.
Example headlines (Google "tweetie 2 paid update" for more):
"Tweetie 2 Pricing Controversy: An Interview with Tweetie's Creator ..."
"Tweetie 2: 'New App' – Will Spit On Existing 'Old App' Users | iSource"
"Still won't pay for Tweetie 2 upgrade? Try these Twitter apps ..."
"Tweetie pricing fuss highlights App Store flaw | Macworld"
In my experience, at least, it's more or less just a pathological behaviour that you can't escape.
This isn’t the case with productivity applications, necessarily – you can keep using Delicious Library 2 and it’ll keep working great, so we need a way to reward customers who say, “Yes, I’ll pay to have some extra functionality.”
Based on Shipley's numbers, it would seem that developers wanting to make money long-term on the Mac App Store would be wise to get on the same "lower initial price, but all major upgrades are full price" app model as soon as they can.
You may be right that they are going to stay at low initial / full price upgrade... I see two issues with that (for Apple).
One, if the upgrade is not major enough to convince people to shell out for it. This fragments their apps ecosystem, and increases the support headache.
Two, how do you carry people forward to the new version. If it's a separate purchase, that means it's a separate bundle, and won't show up as an update when you check for updates in the mac app store. Again causing confusion and fragmentation (you now have FCPX and FCPX.1 on your machine, which one opens that project file?).
Again, I could be wrong, but Apple's current strategy look unsustainable to me.
I'm not sure what's wrong with offering major new versions of your product at the upgrade price to everyone (new and existing users alike). Sounds perfectly sustainable.
That may or may not be a rational response. After all, if someone thinks an upgrade is worth $X, why should he or she care whether or not a new customer is getting the same price? On the other hand, a developer demonstrating that they value customer history and loyalty (with a discounted upgrade) is a strong signal that they value the long-term customer relationship. That is something a customer could rationally care about. Either way, the potential for existing customer anger is a problem developers will have to deal with.
Wil's post might also be a pre-emptive strike against potential, future customer anger. After all, if a customer complains that they're not getting a discounted upgrade, he can point them to this post.
Apple's development system appears to be optimized for the scenario that if you need some new method added, you can walk down the hall in your building at Apple and get someone to add it. But then they sell that API to paying customers who don't have that option.
The alternative is Google, who doesn't release any top-tier paid apps on Android or Chrome Web Store. Or host anything important on Apps Engine.
Google's business model isn't to release paid apps on their stores. They have many free apps that are downloaded by the 50's of millions and have 4.5-5 stars almost across the board so, yes, they do release top tier apps.
This differs from every OS vendor I'm aware of in the past. Just noting.
> they do release top tier apps.
Could you point out to me some of these apps where the alternatives are sold for top-tier prices?
Mail and calendars are also better than anything I've found in the market...but that's maybe just my preference.
TomTom costs, at last check, $95NZD. I've not bothered trying it.
(I have iOS tomtom for western Europe) Also, it has voices in many languages. So it will still work when you're out of coverage/country.
Remember, 99% of the land surface has crap/non-existant 2G/3G/4G coverage.
This can make a world of difference when travelling abroad when you can't be bothered getting a local data plan.
I definitely use GPS navigation more often when travelling than when in my home country.
There are companies that sell software that competes with things like Google Docs, Navigation, and other services. And yes, you can always point to things they do differently, but that's guaranteed. No one is going to pay $50 for something that exactly duplicates a free service that has more name recognition, so you by definition have to do something to differentiate yourself.
Google pretty much do the other way around: they build tools they need for their own developments (Closure Library, v8, Go...) then release it Open Source for others to use.
The second is more interesting though. They actually do use it quite a bit. Its the kind of thing they use internally, and the employees use for personal projects or when they need something technical for an external presentation. Also, app engine is probably built to serve a different purpose to their other services.
In the case of paid upgrades, if it pains customers and leads to lower device sales, then Apple will come up with a solution to it. Developers (and Apple's internal team as well) come in at a distant second place.
The line I occasionally hear in the apple dev community is "you can't change x/y/z on that component, you need to rebuild it from scratch", which time and again shows a very narrow focus in their tooling.
See http://t.co/EkqWISbS for an example, appears as a bug when you try and upgrade an app you've deleted -- but it shows the capability does exist.
I agree they won't enable it until they have a reason, the current situation is simple to manage from all angles.
Probably the best you could do with IAP is offer current version as IAP, and roll your n-1 features back into the main app as a free update on a periodic basis (i.e., want the latest and greatest, buy it now, or wait X months/years and get it for free).
Nickle and diming your customers for features also leaves a bad taste in the mouth.
As a customer, I appreciate Apple's model since I know all updates are free and any major version changes usually warrant a new app entry (I find it annoying, but understandable, that the previous version is sometimes retired from the App store), which makes the demarcation clear of what I need to pay for vs. what I don't.
One result of this approach is that everybody gets bugfixes for free, which users are sure to like better than a model where they have to pay for fixes.
One thing you have to decide is what to do if you then release version 4, and someone never paid for 3. Does he have to pay for 3 and 4 separately, or can he just buy 4 and get the 3 features for free? (I'm pretty sure you don't want to let him buy 4 and not have 3; that's where you start getting configuration explosion.) The latter has precedent in the packaged world, with vendors that would give you the same discount when upgrading from any earlier version.
All new features are paid for as content upgrades currently are.
If you overhaul your code you release it first as a free demo (old language; beta), then discontinue it as you release a feature-matched-update to the single paid for version you maintain.
This reduces new features to an individual cost upgrade and ensures your existing users aren't left with an unsupported version.
This is actually a very good result for the consumer. (I'm thinking premium applications such as Audio, Photoshop etc.)
http://shapeof.com/archives/2012/03/brent_simmons_on_deflati...
Let me explain:
From a users perspective, this would suck. It is an antiquated system. "I have to pay for an upgrade just so it works on the new OS?" Think of how many times you've had to do this in the past, and how you felt.
Apple will act in the best interest of Joe User, not Joe Developer.
Instead of paid upgrades, dev's should be providing In-App purchases for new features. Maintenance of the App should be provided for free. Win-win for all.
Now stop bitching about what the MAS should have, and start using the solution Apple has given you! :)
I would much rather pay the 20$ or whatever to upgrade my software, than be nickel and dimed all over the place.
Imagine In-app purchase options for options X, Y, an Z, $0.99 each. I only use X, so I'm only going to buy that. You use all the features though, so the developer provides an In-App option for all three features for $1.99.
Still feel nickel and dimed?
It's how the gaming industry currently works (with DLC), and while it's working for them right now, there's an ugly backlash against those companies that forms with every new DLC release that requires a lot of PR to counter.
As Joe User, I depend greatly on Joe Developer to make my Mac more usable. If Joe Developer is driven away for greener pastures, and my Mac experience degrades as a result, the chance I may not stick with this platform grows.
All In-App purchases are listed in the Available In-App Purchases section in the App Store.
Under the in-app purchase model, both customers have to pay $50 for X, Y and Z, which provides a high barrier to entry, a poor customer experience, and poor reviews for the app.
There are ways around this scenario, but none of which are as user friendly as allowing previous owners to purchase new versions at a discounted price.
Say the app is originally $10.
A year later you push out the "2013 feature pack" for $10 more.
Existing customer pays $10 ($20 total over lifetime) for upgrade. New user pays $20 at once ($10 base + 2013 pack).
A year passes, 2014 pack comes out, existing user pays $10 ($30 over lifetime), new user pays $20 ($10 base + 2014 pack (which subsumed all features of the 2013 pack)).
The existing user is always getting an at-the-moment discount.
Now, yes, the existing user pays more over the lifetime than the new user, but this is no different than conventional upgrades. If you've religiously bought every Lightroom upgrade you've paid more than the guy who jumped in at Lightroom 4 over the lifetime of the product, even with the upgrade discounts.
EDIT: clarified a bit
Same problem. The new user has a poor experience, and essentially pays twice for features that were bundled in the app to begin with.
Of course, at the $10 price point for initial purchases and upgrades, it's simpler to just release a separate app.
Maintenance should not be expected for free. New features should not be expected for free. How much those two pieces of work cost should be dependent on future expected earnings for the developer and the perceived value to the consumer, not on whether or not they are "expected" by users.
For an argument that starts out pandering to the "users perspective", I don't see how having a dedicated upgrade process is less "pro-user" then in-app purchases. Not only does it introduce more testing (altering the expected earnings vs. perceived value equation) but it also inserts delivery and design issues for the purchases which wouldn't be necessary with an upgrade system.
To me this looks lose(devs)-win(apple)-push(consumers)
I justify charging for new features, not maintaining the ones the user already paid for.
Users who purchase an app definitely expect there to be maintenance on the app. This is because we know no one tests their app to 100% perfection.
If I knew that the app I get at the time I pay is all I get with no future updates, not even bug fixes, then I'd wait several months to make sure no one else finds any bugs before I ever dare to buy the app. So developers give users the expectation of future updates and fixes to assuage user fears so that they actually buy the 1.0 release and give the developers some money to keep living on.
Features, on the other hand, I expect to pay for.
How would you architect your app to have separate, modular features?
How would I reliably test all combinations of all features?
How do I properly advertise app functionality without deceiving users?
How do I properly support users when they have issues? (Depending on what they've purchased, they could have a very unique set of features and UI enabled.)
You're taking a hammer and using it to tighten a screw. Instead, Apple should be offering the proper tools we need to offer reasonable app upgrade paths.
Say, one in-app purchase, the "2012 Feature Pack", or some such.
That said, I'm not convinced its a better idea than just creating a new FooBar2 app in the store and pushing an update to FooBar1 advertising the launch sale of the new version.
If so, that is pretty crummy for your best customers.
To address your side comment about laziness: the author of the original post is Wil Shipley, the guy who started both Omni Group and Delicious Monster. In other words, he's one of the longest-running and most financially successful "indie" devs in the Apple community. When he says stuff, people (including people at AAPL) pay attention, because what he says is a product of both a lot of experience and a lot more customers than most indies will ever see.
To address your counter point: it is all a mater of implementation, implementation, implementation.
1) I don't think it is unreasonable to say that developers should maintain the features they've already been paid for gratis.
2) It require planing from the get-go within your app, you can't tack this on after the fact. Basic features are covered by the initial purchase of the app. Additional features (AKA what one would want to charge for with a major version upgrade) or perhaps feature "packs" are provided via In-App purchases. New users always start out at the same level, requiring purchases for new features. Features already purchased to be restored via the facilites available in StoreKit.
1. Nobody's saying this. The original post actually asks for the ability to maintain older versions in the app store (so that, presumably, users who don't want to upgrade don't get stranded) while preventing new users from purchasing anything but the latest version.
2. So after three major upgrades, the experience for new users is: pay for app, then pay for three "upgrades" from within the app? Or even just one "roll-up upgrade" that implies all of 'em? And same for re-downloads: install the app, then restore purchases?
That sounds like a very un-Apple-like user experience; it's not something I would want my users to deal with.
But if I rewrite an app and improve the art and the flow and the interaction and every little part of it, there’s no way to say, “Hey, pay and we’ll give you the better interface.”
I spend years tweaking every single part of my apps when I make a new version. I can’t just throw a switch to turn those on or off.
Finally: it’s pretty much my job to bitch about what Apple does wrong, just as it is yours: it’s the only way they will improve. They’re not gods. They need feedback.
Actually, I'm not really asking if you have looked at it - you probably have. But I'd be interested in hearing your analysis, particularly as this seems to be the route that Apple has taken themselves - cheaper software but you pay full price for each new version.
Most, like Wil, do the right thing. Delicious Library hasn't had a major release in years, but it is maintained.
Others (for example, in my experience "DVD Remaster Pro" and Parallels Desktop), clearly abuse the major update system as a revenue source. They release fake major releases with lots of new skin but few features every six months or a year to rake in the dough.
Honestly, it's a mess. But the solution to me is obvious: Angry Birds from Rovio. Rovio didn't just release the thing and stop. They keep adding significant features (the game is probably 10X as large as when I bought it for the iPad). Customers feed back with great reviews. Rovio is rewarded with continuing sales and stays in the top seller lists. Meanwhile, apps like "Plants v. Zombies" are static and drop off the top lists quickly after a quick burst of popularity.
Rovio also just released Angry Birds in Space, which is a separate app, meaning they'll get new income from it. But because it's a $0.99, giving existing customers a discount isn't important.
If you’re making a productivity app, and you dribble out features, the press is going to ignore you. Can you imagine anyone running a story like, “Delicious Library 2.8 is out, and it includes a pretty new way to look at tables”? It’s just not going to happen, unless your name is Apple.
The press hit we get on a major release is part of what gives us the important spike in sales. It creates “buzz.” There’s a reason why even Apple doesn’t, like, just release iOS 5 feature-by-feature – they want to spring the whole thing on the world, so they get a ton of attention.
I don't think it's so terrible that there is multiple versions out there. Reduce the price of the older version and setup the page to let people know there's a new one out there before buying.
So I pay 10 dollars a month to have access to the MAS and I download 3 apps. I use App A 50% of the time, App B 20% of the time and App C 30% of the time. (To keep the math simple lets pretend Apple doesn't take their share). App A's developers would get $5 a month, App B's developers would get $2, while App C's gets $3.
Maybe to handle the Pro apps like Final Cut you could have different subscription tiers?
To users, this would be a simple netflix like subscription model. Developers would have an incentive to make their apps more useful and engaging. (I'm sure it could be abused too)
That said, I do think we're going to see more experimentation with subscription models. Adobe's Creative Cloud is one example. I could imagine some sort of aggregator of games as well.
If the developers develop a whole new set of features (while still building off the core functionality) that they could call "Delicious Library 3", but are actually fully compatible with Delicious Library 2, why should they have to ask their users to pay full price for an upgrade, when they already have the core functionality which is the draw for the new users to pay full price.
I've seen positives and negatives to this model in video gaming. I love seeing a full-feature expansion to a game I own, and don't mind paying $5 - $20 in addition to the $60 I already paid, but I wouldn't be happy paying $60 again for the "complete" edition just to get the expansions, but that "complete" edition is great for people who haven't already purchased the game.
Put differently: if I’ve written an app that 50% new, don’t I deserve to get paid by existing customers for that work?
Because the user base for the platform has been growing the potential install base for your application grows with it. The graph in Wil's post shows that the same application had a huge sales surge just because more people were exposed to it.
If a new version of Delicious Library comes out his existing customers will be very happy with the new features and bring more customers in with them. I bet Apple would even promote the new app and a huge sales spike would happen again.
In my mind the new model isn't how to get the most money from your customers, it's getting the most customers.
I appreciate the free upgrades as much as the next guy, but without the paid-upgrade option niche products will suffer.
How about you stop treating software like fresh fruit delivered with a worm in it and start treating it like, say, new cars? Sell it with a warranty. Allow me to extend the warranty, up to a point, for a reasonable price that covers maintenance only. If I have a reason to buy a shiny, new 2013 BozoWare, and the reason isn't that the 2012 model is already broken, I just may. Some people buy new cars every year; everybody buys a new one sometime.
The one missing thing I think Apple needs is a neat mechanism for allowing existing apps to be upgrades into app store apps.
Again we find that conflating real-world examples with technology issues is a bad way of understanding them. With a house you typically have a warranty period and afterwards are required to pay for fixes yourself.
There is a lot of grey here that paid updates help deal with. The users will vote with their wallets if they feel they're being thoroughly fleeced.
If there is a massive OS upgrade on the horizon that might break it - don't spend the money on it. Don't expect anyone to pay for it but the end user.
Expecting developers to support the product until the heat death of the universe without ongoing compensation is ridiculous.
Now of course there are variations on this that developers can be nice and provide if they feel like it, but I never expect anything I buy to have any more support than was explicitly outlined to me when I laid down the money.
I very much do not believe that you paid me enough for me to guarantee that my product would work in all circumstances forever. If you did, then by golly I'm yours for life buddy!
It would lower up-front costs. I bet piracy would go down too. It would give developers an incentive to keep even small apps bug-free. It would make more sense for apps like Instapaper where the server needs to keep running. Everyone would get exactly what they pay for, and nobody would have to keep using an older version for artificial (financial) reasons.
The only downside I can see is that people cannot decide to stick with an older version because they actually like it better. But that's something that Apple customers are probably used to (e.g. surprise 10.6 users, no OTA contacts & calender sync for you anymore!). And for Apple, it may decrease vendor lock-in because people have no sunk costs anymore.
That way, users always have a way to downgrade to previous versions as needed, you probably get more customers due to the entry price, and everyone just understands that the latest version is available for $10 more.
That seems to be the whole app store model: lower prices, more sales -- no "upgrades" in the classic sense. And, with a low enough entry price, I think users would be accepting.
If they don't buy the latest, as a developer you're no worse off than you are today (where they get the latest for free).
It's making me think about the service model as being a superior revenue stream, for-better-or-for-worse. From a user's perspective, the MAS already acts as a service; the subsidy is just being paid for at the developer's end of the scale.
I love the iTunes/MA stores as a marketing and distribution channel, but I hate how heavy handedly Apple behaves with enforcing business models. I think there's an argument to be made that we can avoid the Android marketplace crapware without forcing everyone to become serfs.
Calling people who willingly cede less than a third of their profits for access to the giant infrastructure and advertising Apple has at their disposal is a bit of hyperbole. It's a mutually beneficial arrangement for both parties, which both parties are free to sever at any time. Doesn't seem like serfdom to me.
Jeff Atwood has from what I can tell never shipped shrink-wrap software as an ISV on any platform (I don't mean that derisively).
In that sense, App Store developers are very much sharecroppers whether they enjoy and accept it or not.
I can very easily imagine a near future where it's not rational for small vendors to opt out of it. You're not wrong; it's just… more complicated than I am capable of articulating at present.
IMO, there are just very real reasons to be weary of the shifting power dynamics in the consumer software space.
In both cases, landlord is more powerful than the sharecropper and can set "take-it-or-leave-it" terms (which, if you consider game theory, suggests that the landlord will capture most of the profits of the relationship - limited only by a sharecropper's alternative ways of making a living and their willingness to make decisions that are economically irrational in the short term in order to improve their situation in the long term).
I could even go on to talk about sharecroppers buying seed, fertilizer from the landlord and compare that to developers buying laptops, paying for developer programs and so on, but this analogy has probably been pushed far enough as it is.
And here I was blissfully unaware that Pages and Keynote had rotted into uselessness simply because of the calendar year.
This is a very good point. In this consumerist society, if a "new" version is not produced at least once a year, obviously the old one is not worth having.
So, yes, software does “rot,” if it’s not kept up-to-date with the latest operating systems and, to an extent, the latest user interface metaphors.
Why not provide two versions of Delicious Library Inf? One costs $20. It only works/installs correctly if you have the original app. The other one costs $40. It is a standalone app. Make a minor bugfix update that says "hey" to the users of Delicious Library 2, and link to the expansion. Sell both.
Eventually, nearly all your users have already paid, leaving you unable to charge them for enhancing the app. You may have a huge installed base and eventually have no incentive to improve the product.
"Hey! You're using an outdated version of [APPX]. Click okay to upgrade via the App Store, or Cancel to continue"
Example: I was searching for a tool for file deduplication. Looking at some older screenshots and the current trial of a certain tool, I realized that this was now less geared towards power users, with UI changes that made the tool look better for inspecting a few duplicated pictures but unsuitable for using lots (thousands) of files. Imagine being the user who bought the tool for more serious use, and is forced to "upgrade".
It has? Whenever I look, I tend to see trivial little apps of the same depth and quality as your typical iOS App Store app. Feels like a ghetto to me.