At the end of the 20th century, software developed by leaps and bounds. And with each new version the volume of changes was so great that there was no question why, in fact, buy new versions (of course, for those who, in principle, bought software).
However, in the 21st century, the situation began to change. Some software packages reached such a level of development that it became unclear to users why to update. After all, the version that they already have, perfectly solves all problems.
Updates as part of support
The first to look for a way out of this situation were software manufacturers for business (business to business, or B2B). For them, growth is always limited, and when the 'ceiling' is reached, one has to rely only on the fact that old users will still want to buy new versions of software. And the way out was found. Since in B2B not only the fact of the initial purchase of software is of great importance, but also its support, a scheme appeared with a combination of support and updates. Paying 20% (and sometimes 30%) of the cost of the software, the buyer received technical support and updates to new versions during the year. If everything was fine, the support was extended further. If the buyer thought that he had become quite well versed in the software and did not need the vendor's advice, and the functionality and stability of the current version had reached an acceptable level, then he refused to extend support.
At the same time, users who refuse support are not completely abandoned. They still have access to the community (forums, knowledge base, etc.). Indeed, at some point in time, they may come to the conclusion that a critical mass of useful things in updates has been achieved and it's time to fork out for a new version. Moreover, good income from support somewhat changes the outlook of vendors, and they may not mindlessly rivet new versions, but seriously attend to fixing errors.
Business-to-customer (B2C) software vendors are also moving towards a recurring payment model over time. As soon as the market is saturated and it is no longer possible to grow due to expansion, money for maintaining the application and releasing new versions has to be sought from other sources, and not from the sale of licenses for copies of the software. And the point is not even that the developers want to eat bread and butter (and the stakeholders also want to eat with caviar). It's just that there are so few new users that there is not enough money from them to develop new versions and support previously released ones, even if you put developers on bread and water.
In order to somewhat “sweeten the pill”, subscription buyers receive not only new software versions, but also various goodies: file storage in the cloud, online editing in the browser, and so on and so forth.
Even a sweetened pill can be rejected by users, which is why the mobile industry made a knight's move with in-app purchases. They are most popular in the form of free-to-play games.
The calculation is made on the psychology of users: when you are already close to victory and just a little is missing for it, it is much easier to 'shake off' a small amount from you for advancing in the game. Another thing is that the amount is not always really small. In some cases, several purchases can amount to such an impressive amount that it will exceed the cost of the paid version for a large platform (set-top box or PC).
It is this concept that can be considered the final winner today. There are very few people willing to buy games on mobile devices at full price. It's good if the costs for the game are low and the publisher can afford to set the price at 99 rubles. But if not, then users are waiting for free-to-play with in-game purchases.
Sticks in wheels
It so happens that the manufacturer tries by hook or by crook to extract money from the user for a subscription. It comes to the point that the complexity of unsubscribing may differ from the complexity of a purchase, not even several times, but orders of magnitude.
Typical example: Adobe Photoshop (plus a subscription to a photography kit that also includes Lightroom). The purchase is made with a minimum number of clicks. You just need to enter your bank card details – and now you are the happy owner of an Adobe product. But if you want to end your subscription, then you need to go through the whole quest. At first, it turns out that no interface elements for this purpose are provided either in Creative Cloud or on the site. You need to contact support.
Further, it turns out that the support employee will speak English with you, and whether you know the language sufficiently – no one cares. If you cannot explain that you want to cancel your subscription, it means that it will continue to operate. Fortunately, the conversation takes place via chat, not over the phone, so an electronic translator can be used. This can really help as you need to convince the support staff member that you no longer need the subscription. And he will resist and ask how it happened, because their products are the best and no competitors were even close.
Are there any alternatives?
So, what are the options for developers to have enough finance to release new software versions:
- Fairly high initial cost. How about $ 99 for an app that has free alternatives?
- Redistribution of cash flows: receive income in one place and thereby finance another. For example, you can earn money for games on one platform and, due to this, set attractive prices on another. Or make money on a service for which the software is just an add-on. For example, taxi calling apps are free because they are funded by paying for rides.
- In-app subscription or payment.
Whether we like it or not, the subscription option is becoming more and more popular.