
Pragmatic app pricing - ingve
http://www.marco.org/2015/10/13/pragmatic-pricing
======
dave1619
Looks like we've got some interesting thoughts from Marco.

Seems like he regrets keeping Instapaper a paid app and not making it free to
go after marketshare and take on Pocket. He seems to conclude he "lost"
against Pocket, and now doesn't want to make the same mistake with Overcast.

I personally don't think the patronage model will go very far. I think he's
doing more to make the full app free and gain marketshare, and any money made
by "donations" is just bonus. If he can grow his marketshare and get a lot of
users, then it looks like he's going to try to raise funds. So, this business
model makes sense for now... at least until he's able to raise outside funds.

Overall, Marco seems to be insinuating that the podcast market is bigger than
people think, and VC money is going to enter the space; thus, he wants to
prepare for that and maximize the potential for his app and the possibility to
raise funds and go really big.

It does seem that when VC funds enter a market it presents a challenge to
existing indie developers who are making a living with a paid app. The VC-
funded company will provide a great app (usually) for free, since they don't
need a monetization stream right away. They usually are aiming to build a big
audience and then monetize later.

Indie developers are then faced with a decision. How do they compete with VC
funded companies? They likely are going to have to either make their app free
and go head-to-head with these VC funded companies (and maybe raise money
themselves to do so). Or they can narrow their scope and become more niche
apps appealing to a more limited audience with high-end (hard-to-copy)
features that might not appeal to the masses but to the minority who might
pay.

But overall, Marco's blog post does bring up the challenges indie developers
face when VC funded companies enter their space.

Would love to hear more thoughts on this.

~~~
x0x0
But let's assume we're not in a bubble, so raising funds isn't an end in and
of itself. Where does the money come from to give investors a return when the
entire app is free?

~~~
shalmanese
Podcast advertising is fantastically profitable even though it's extremely
unsophisticated. As the profit margins shrink due to increased competition,
more sophisticated ad formats are going to come along to keep the lights on.

Right now, every podcast listener hears the exact same ad regardless of where
or when they are listening. It seems obvious that at some point soon, podcasts
will include a custom code for "insert ad here" and an ad exchange will bid on
that 30 second spot and put a targeted ad there. Currently, the MP3 + RSS
format of podcasts doesn't support this degree of sophistication which is what
Marco is alluding to with it's walled gardens comment. There's a goldmine for
whoever can figure out how to move podcasts into a vertically integrated
format and define the platform.

------
boulos
Marco says "I’m not doing anything that other developers can’t do" a few times
in this post, and sadly I think it's disingenuous.

I believe Marco got at least a couple million dollars from the ~$1B sale of
Tumblr (dilution, not clear how much he started with, etc.). That's actually a
_lot_ of padding, and means that _he_ can get by for a year or so to try out
this free + patronage model. Someone that _needs_ an income, doesn't have that
luxury.

~~~
Albright
Indeed, thinking of Marco Arment as an "indie dev" is sort of like thinking of
Minecraft as an "indie game." Regardless of roots, at some point, they both
crossed a money line. That being said, assuming he is somewhat financially
prudent, Arment probably has enough money to just drop into mutual funds and
live off the interest, so I guess it says something about his passion as a
developer that he's still coding and trying to make an honest buck off of it.

I think the patronage model is interesting, and I'm curious how he or other
developers will make it work within the confines of the App Store.

~~~
Moshe_Silnorin
So once you're successful you're not an independent dev, even if you have no
staff? And once a band is popular it's no longer good?

~~~
Albright
Once you achieve a certain degree of success, you no longer have the same
challenges, concerns, or mindset of the typical "indie dev," yes.

This is a guy whose tech podcast I stopped listening to partly because he and
some other dweeb wouldn't shut up about their brand new BMWs.

------
falicon
Gotta respect Marco for all the success he's had with Tumblr, InstaPaper,
(briefly) Peace, and of course Overcast so far...but I kinda feel like he is
worried about the wrong thing/people here.

Who cares if other devs. or companies don't like his business model? Does that
affect his users or potential customers in any real way? I don't think so.

Also - the patron model is super interesting and I'm excited to see people
continue to play with and test it...but I'm not sold that it's a sustainable
solution either.

The question to me is: Do people care enough to pay for podcasts? And for
those that do, in their mind are they actually paying for the content or the
experience/environment? What pain is this specific app itself actually fixing
or removing compared to my alternatives?

Marco has proven he's amazing at building experiences and environments people
love...and I think he can continue to do very well down that path...but
without owning/controlling/providing the content or the 'talent' on the client
side he'll never break out of being just one of the middle-men in that part of
the ecosystem (and thereby evaluated and paid by users as such).

~~~
untothebreach
Just one persons experience, obviously, but I have paid for podcasts before.
Free podcasts are by far the majority of what I have listened to, but I pay to
get the full episodes of "The NoSleep podcast", and have donated to other
podcasts when they have the option there and I have liked them enough.

~~~
falicon
Cool - but do you feel like you are paying for the content or are you paying
for the experience/environment that you listen to the podcast within?

My point was just that when people do pay, in their mind I think they are
paying for the podcast itself...and don't really care all that much about the
middle men (same basic thing with music really -- there are, of course,
exceptions)

~~~
untothebreach
Oh, I see. No, I am definitely not paying for the experience/environment per
se, but I _did_ pay for a podcast app that had features that I wanted. I.e.,
the most popular free podcast app on Android (Stitcher) didn't have any way to
speed up the audio, cut silence, etc _, so I paid for an app that did have
those features.

_ Maybe it does now, this was a while ago

------
programminggeek
Patronage works because he has a huge audience giving him some money. Without
a huge audience, it doesn't work. He's one of the most well known developer in
the world.

His situation only applies to him. Not anyone else.

------
tdtran
Looks like he still cannot get over with Pocket. They were supposed to clone
features from Instapaper etc. I paid for both Instapaper and Pocket (when it
was still named Read It Later and had paid version on Android). I stopped
using Instapaper and used Pocket exclusively because Pocket is simply much
better piece of software. Period. On iOS and of course on other platforms
Pocket can run but Instapaper can't.

He wrote "They’re coming with shitty apps and fantastic business deals to
dominate the market, lock down this open medium into proprietary “technology”,
and build empires of middlemen to control distribution and take a cut of
everyone’s revenue."

Well, what if they are coming with _better_ apps and fantastic business
deals.. ?

Being an indie dev (or a small indie company) does not automatically make you
a better developer / software maker than anyone else. Part of that may be lack
of resource, but maybe just maybe you're competing with someone better.

------
binaryapparatus
Don't get me wrong but I have to say it: I kind of like the guy and what he
does but it is getting closer and closer to not be surprised if he shoots
belfie one of this days. Whole Peace drama and how it was performed is
something I would expect Kardashians to do.

~~~
212d1d
Don't forget when he banned 9To5Mac from Instapaper because they called it
Instascraper: [http://www.buzzfeed.com/mattbuchanan/how-to-get-banned-
from-...](http://www.buzzfeed.com/mattbuchanan/how-to-get-banned-from-
instapaper)

------
jmartinpetersen
It seems the complaining competitors are betting on keeping content delivery
mechanisms from being commoditized. History shows that it is a risky bet.

------
lindig
The article's premise is that Big Money is rushing into podcasts but without
giving details what that is. Maybe this is bad for Overcast and other clients,
but it could mean that popular podcasts can make more money. Marco is
definitely invested in that side of the equation, too, but doesn't talk about
in this article.

~~~
dkasper
I think the idea is exclusive content that you have to download "shitty apps"
to listen to would be a bad trend for consumers, and probably all around. Sure
some popular podcasts can make more money, but at what cost?

------
swanson
> But imagine you’ve been working on Castro 2 for the last year, betting the
> company on a big launch and a sustainable income.

Sounds like the Castro 2 dev(s) made a bad bet if their success hinges on the
available of a free alternative :(

~~~
cowsandmilk
the quote was from a 3rd party; the castro devs said nothing about Marco going
free.

edited to add: rather, after people assuming the quote was from them, the
developers of Castro issued a statement of "Castro 2 is coming along
wonderfully and we're not worried about Overcast going free. <closes twitter,
gets back to work>"

[https://twitter.com/Padraig/status/654012918292320256](https://twitter.com/Padraig/status/654012918292320256)

