07-22-2002, 04:16 PM
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Executive Editor
Join Date: Aug 2006
Posts: 29,160
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Charging for Software
http://articles.pocketnow.com/content.cgi?db=articles&id=87
Russ Smith has written a column on the evolution from freeware to commercial software in the Pocket PC community, triggered by the recent announcement by the Pocket TV team to charge $49 US for the Xscale-optimized version of their free-for-personal-use Pocket TV MPEG player. I have mixed feelings on this - people deserve to be rewarded for what they do as a service to others. That reward can be money, praise, or just the warm fuzzy feeling they get knowing other people appreciate their work. The question is, will you pay $49 for a video player? Quite honestly, I will not. I'd have no trouble dropping them $10 or $15 via PayPal for a good video player, but $49? No thanks - that's $75 CND, which is the price I just paid for WarCraft III. It would take a Pocket PC "uber app" for me to pay that much. I'll just stick to WMV formats or use Pocket DivX.
I do want to add this thought as well: creation involves sacrifice, if nothing else other than time, and someone who is sacrificing has every right to ask for compensation. If you don't want to buy the product, don't buy it - but don't get angry with the creator for asking in the first place. If you can do better for free, do it - but don't complain about it and do nothing. Russ' blurb:
"Within the Windows CE community, there are mixed opinions. Maybe we're spoiled by the larger number of decent quality freeware programs out there. Maybe we're put off by the fact that the cost of software can easily add up to more than what we spent on the machine that runs it. Maybe we're just cheap. Whatever the reason, we've come to expect that we should be able to get something for nothing most of the time.
Part of this is normal to the evolution of a hardware platform. When the Apple ][ first hit the market, the vast majority of early programs written for it were freeware. That's because the vast majority of early owners fell into the "enthusiast" category. Most of us enthusiastically shared the fruit of our labors. It was a kind of "Look what I did!" approach. As the personal computer became used in more and different environments and, particularly with the advent of VisiCalc and widespread use in small business, freeware and shareware began to take the back seat to professionally written software which cost real money. Some people had trouble making the transition. Some put on eye-patches and began sporting parrots on their shoulders. I was actually apprenticed to such a pirate (apologies to Gilbert and Sullivan) for about a year. I was naive enough at the time to wonder why he needed more than one "backup copy" of his software and why he kept on "losing" them."
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07-22-2002, 04:35 PM
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Pupil
Join Date: Jun 2002
Posts: 15
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I agree on the $10--15 dollar mark. I don't see any PPC software that is worth $49. So, I will do without.
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07-22-2002, 04:55 PM
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Intellectual
Join Date: Feb 2002
Posts: 134
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I've said this before but, here goes the rant again!
It's corporate customers! If they buy 100 they expect (and maybe deserve) big discounts. If you start at $15 there is not much left for discount. If you start at $49.00 you end up getting your $15 for the bulk of your purchasers.
If they end up selling zip the price will come down. But with support costs, distribution costs etc. , when a product becomes succesfull the price must go up. And for those of you that say in this electronic age distribution is free, just ask Jason about bandwidth problems.
AZMark
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07-22-2002, 05:12 PM
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Thinker
Join Date: Feb 2002
Posts: 355
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blast from the past: AN OPEN LETTER TO HOBBYISTS
kinda interesting. this was in 1976.
>>
AN OPEN LETTER TO HOBBYISTS
By William Henry Gates III
February 3, 1976
An Open Letter to Hobbyists
To me, the most critical thing in the hobby market right now is the lack of good software courses, books and software itself. Without good software and an owner who understands programming, a hobby computer is wasted. Will quality software be written for the hobby market?
Almost a year ago, Paul Allen and myself, expecting the hobby market to expand, hired Monte Davidoff and developed Altair BASIC. Though the initial work took only two months, the three of us have spent most of the last year documenting, improving and adding features to BASIC. Now we have 4K, 8K, EXTENDED, ROM and DISK BASIC. The value of the computer time we have used exceeds $40,000.
The feedback we have gotten from the hundreds of people who say they are using BASIC has all been positive. Two surprising things are apparent, however, 1) Most of these "users" never bought BASIC (less than 10% of all Altair owners have bought BASIC), and 2) The amount of royalties we have received from sales to hobbyists makes the time spent on Altair BASIC worth less than $2 an hour.
Why is this? As the majority of hobbyists must be aware, most of you steal your software. Hardware must be paid for, but software is something to share. Who cares if the people who worked on it get paid?
Is this fair? One thing you don't do by stealing software is get back at MITS for some problem you may have had. MITS doesn't make money selling software. The royalty paid to us, the manual, the tape and the overhead make it a break-even operation. One thing you do do is prevent good software from being written. Who can afford to do professional work for nothing? What hobbyist can put 3-man years into programming, finding all bugs, documenting his product and distribute for free? The fact is, no one besides us has invested a lot of money in hobby software. We have written 6800 BASIC, and are writing 8080 APL and 6800 APL, but there is very little incentive to make this software available to hobbyists. Most directly, the thing you do is theft.
What about the guys who re-sell Altair BASIC, aren't they making money on hobby software? Yes, but those who have been reported to us may lose in the end. They are the ones who give hobbyists a bad name, and should be kicked out of any club meeting they show up at.
I would appreciate letters from any one who wants to pay up, or has a suggestion or comment. Just write to me at 1180 Alvarado SE, #114, Albuquerque, New Mexico, 87108. Nothing would please me more than being able to hire ten programmers and deluge the hobby market with good software.
Bill Gates
General Partner, Micro-Soft
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07-22-2002, 05:18 PM
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Executive Editor
Join Date: Aug 2006
Posts: 29,160
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Wow - brilliant! Is there any wonder why Gates is rich today? The man GETS IT! It's eerie how the more things change, the more they stay the same. It's not a matter of theft in this case, but the last line about him wanting to hire more programs to deluge the market with great software is excellent - I think that's the dream of any hobbyist turned professional. They want to keep doing what they do, but they don't want to starve to death by doing it. :-)
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07-22-2002, 05:19 PM
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Moderator
Join Date: Aug 2006
Posts: 6,878
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Quote:
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Originally Posted by AZMark
It's corporate customers! If they buy 100 they expect (and maybe deserve) big discounts.
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Didn't the folks at Pocket TV already charge for businesses? The free version was for personal use only. Maybe there isn't enough interest on the business front and they need to make up the difference somewhere, but almost 50 dollars? That's a bit steep.......
Steve
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07-22-2002, 05:21 PM
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Magi
Join Date: Sep 2005
Posts: 2,341
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I have to agree with much of what Jason says. I also believe that software developers should not be expected to work for free. However I think that $49.95 is to high a price for this application. For me this is also $75.00 Canadian. If they feel that this is what they have to charge for their product to turn a profit, so be it. Sometimes things just end up being to high priced by the time they get to the consumer to be a successful.
To go from free to $49.95 in one giant leap is too much for mankind. 
IMHO
Dave
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07-22-2002, 05:28 PM
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Thinker
Join Date: Feb 2002
Posts: 355
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ecosystem
sure, people will always look for options, others may make a free product, then eventually want to sell that too, it's innovation, it's why it's great to be a human, this is all part of a very cool ecosystem.
for pocket tv, this could be part of the marketing / biz plan. start out high and the group of "alpha" buyers who will buy anything at higher price points will bite. these are the same people that will pay $25 more to get something overnighted. the reason i'll most likely always be in 5 digit debt is because i do that all the time. if i had an xscale device i'd pay the $40, my guess is there are many people like me, enough to justify it.
then after the sales dip at the $40 price point, target the next bucket. also starting at $40 helps bulk sales, when a large company wants 100 copies at %50 discount, it's better for the developer.
it's also demand. there is high demand for xscale apps (at least the perception is by some) it's the same reason newly designed nike shoes are $200 the week they come out, and then they're quickly $150, then $99.
cheers,
pt
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07-22-2002, 05:32 PM
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Contributing Editor Emeritus
Join Date: Jun 2003
Posts: 1,350
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Quote:
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Originally Posted by Jason Dunn
Wow - brilliant! Is there any wonder why Gates is rich today?
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Although some say he is rich because with all illegal copies of DOS and Windows he managed to get a PC monopoly, this letter in my opinion proofs this was not the intention at all. This is also described in Hard Drive when Gates gets angry about the illegal software tradings at hobby club meetings.
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07-22-2002, 05:37 PM
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Thinker
Join Date: Feb 2002
Posts: 400
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Blah, blah, blah! You're telling me that they can make PC software for less than $49 but not PPC software? It took Blizzard how many years to make Warcraft III and it costs the same as an Xscale Optimized version of Pocket TV???? Give me a break. AZMark If Corporate market is the problem with pricing, set up 2 versions of the software. Public use = less features smaller price, corporate version = more robust, higher price! Simple as that. There is no justification for trying to charge $49 for a PPC App, excuse me, an optimized version of a PPC App! And I don't imagine there are too many Corporate owners of Xscale PPCs right now either. It seems to me that they are trying to take advantage of the fact that the OEMs screwed their customers by not optimizing their PPCs before they released them. Which is all well and fine as long as they are willing to pay for it, it's part of capitalism after all, but I think they would have done better to come out with a more reasonable price. Something the consumer could see that wasn't meant to screw them yet again with the whole Xscale fiasco.
If the price were more reasonable it would be like saying ok guys this took effort on our part to develope this for you so we need a little compensation. No Problem, Done! However, at $49, it seems to say ok the OEM scammed you the first go round and now you are stuck, so we are going to bleed you some more for making your PPC work like it should have to start with, and we are going to charge you the most we think you can possibly bear. At $49 for optimized PPC Apps it would be cheaper for me to buy a 206MHz StrongARM PPC and wait on MS and the OEMs to optimize my Xscale PPC whenever they get around to it. I have way too many Apps that I use regularly to go around paying that much to have them optimized! You can pick up a PPC 2002 device around $300 brand new most of the time.
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