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The 2014 Panic Report

panic.com

41–47 of 47 posts

Re: The 2014 Panic Report

#42
post #24
post #6

I wince a little when I read the section titled "Low iOS revenue." The iOS App Store's race to the bottom on pricing (and the parallel problem in Androidville) are very hard on developers. Panic reports that their unit sales are nearly even on iOS and OS X - but that the revenue is on the far side of an 80-20 split, that they make more than four times the revenue from a desktop sale than from an iOS sale! Even if you…

Actually Apple and Google are doing something to dev houses, they're commoditizing their products. When an app costs 0.99 it's easily replaced with another one and nearly worthless.

Commoditise your complements: http://www.joelonsoftware.com/articles/StrategyLetterV.html

Re: The 2014 Panic Report

#43

Obviously "Panic" is a well-known company for developing IOs applications and for at least 145 people on HN this is common knowledge. Is there anything special about this company? EDIT: Although the people downvoting (currently -1) this won't read this edit anymore, the question was (and is) meant serious.

Not really, which is why their report is interesting. I don't run a software company, so it's interesting to see the report from a company whose software I use. Plus their posts tend to be well-written.

Compare to patio11, who runs a couple of small online services that together gross only a couple hundred thousand dollars per year--nothing remarkable, from a business sense. Yet his blog posts about running a software business regularly shoot to the top of HN because they're well-written posts about running a solo software business.

Re: The 2014 Panic Report

#44

Earlier quoted context omitted.

I wonder if we haven't turned the corner with respect to app pricing. At first, there was a clear gold rush. Lots of developers publishing small applications, trying to make money. That "oversupply" of developers, coupled with platform limitations allowing only simple apps, immediately drove down prices to the $1 point, as the best professional shop was effectively competing against someone coding on their weekends,…

The problem is the market has been poisoned by years of unsustainably cheap prices. Users have been trained to expect that apps are free, or, at most a dollar. An app priced above $5 will inevitably invite outraged accusations of greed. Many users still believe that the typical app developer is raking in the cash because they read about Flappy Bird. Apple made some very short-sighted decisions in the design of the ap…

> make their devices real productivity tools

I don't see this ever happening on mobile or tablet. No one is going to sit there and create a spreadsheet on a smartphone, no matter how big the screen size is. Once you have email, a PDF viewer, and a spreadsheet viewer (already available), what more could you possibly need?

Apple's pricing is right. It's uncomfortable to sit and stare at a tablet or smartphone for hours at a time, nevermind interacting with it (no matter how good swipe is, it will never replace a keyboard+mouse or a game controller).

Re: The 2014 Panic Report

#45

Earlier quoted context omitted.

It fails massively regardless of the value proposition of the app. People recoil at the price as it instinctively feels unreasonable due to the established norms of pricing. Pre-iPhone, a $20 shareware app was considered pretty cheap. Now less than 10 years later the highest quality apps from name brand companies can't command it.

Absolutely. And it's actually rather odd. People are tend to spent more money on a coffee they buy at starbucks than they're willing to pay for an app they use e.g. every week. Maybe it's because a lot of users have absolutely no idea how much work it takes to write an app. All they know are the Angry Bird and Minecraft success stories thinking that app makers must shit golden bricks every time they build their code.…

> Maybe it's because a lot of users have absolutely no idea how much work it takes to write an app.

I think part of it is the trust proposition too. Why do people pay {BIG NAME DEVELOPMENT COMPANY} {>$1} for an app in the desktop world? Support and upgrades.

What are the two things that the app store has more or less excised from customer expectations w/ regards to a purchased app? Support and upgrades.

Best of breed (aka Panic) aside, obviously. But you have to admit there are a lot more fly-by-night app developers than on desktop.

Edit: It'd be interesting to see how "each feature costs $1" IAP would play out. (Odd parallels to the arguments cable companies are having re: a la carte pricing)

Re: The 2014 Panic Report

#46
post #5

[deleted]

With free iOS options it is hard to have a compelling reason to purchase something which is basically a novelty use case.

Although, I do have a Sharkk keyboard for my iPad and using SSH with that is pretty slick. I have yet to link dropbox with one of my cloud servers to enable an edit, save-to-dropbox, server update loop.

The behavior typically is search for "free xyz" first and if I find something that meets my needs then so be it. I wonder if having "lite" versions that have features removed and are offered free would have any impact on their revenue.

Re: The 2014 Panic Report

#47
post #24

Earlier quoted context omitted.

Actually Apple and Google are doing something to dev houses, they're commoditizing their products. When an app costs 0.99 it's easily replaced with another one and nearly worthless.

Commoditise your complements: http://www.joelonsoftware.com/articles/StrategyLetterV.html

Right, which explains why the dev houses are aggressively moving away from being commoditized, either by selling mobile dev services where the app is a value add to an existing service, or building an app that relies on the network (where there's ability to differentiate).
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