Making money with applications, software, widgets...
Today, I encountered the problem with apps and costs. There are many people who are doing some really great applications (etc.) that are free for use. They put lots of their energy, effort and time into these apps. I would call that a real charity :)
But what happens when the running cost of the app becomes too big for the developer?
Somehow the developer should get at least some money to cover the costs. Quite often the costs aren’t that big as domains, servers and bandwidth aren’t THAT expensive anymore. But some apps still demand A LOT of those.
How to get the money then?
1. Sell your app. Give it a price like 1€ / download. This is ok, if people are willing to pay and the app doesn’t really have that big running cost (or you can be sure that by the time goes by, more and more people are paying from the app). But if it is the use that creates costs… this will make the developer pay in the end. And if the app is really popular but with limited user group, well, the bill might be a nightmare.
2. Sell subscription. Maybe 1€ / month? But are the people willing to pay? And more importantly: how much it will cost to the developer to have this kind of a feature? Credit card billing option isn’t free: credit card companies charge big money on the POSSIBILITY that you can even use this.
3. Pay-per-use. Well, make the user pay only for the real use of the app. Most of the cloud services work like this. (If I will get a huge amount of visitors, this playground of mine will cost like hell...).
4. Freemium-model: give most of the stuff free but if the user wishes to get premium content, they must pay! In some cases user could be a company paying for customization.
5. Ask for donations in your webpage or so. These work somewhere nicely (as people like giving money into things they see precious) but depending on the country you are living, there might be a lot of trouble. Where I live, you have to ask permit from police and then start to hassle with the tax office…
6. Advertisements. Sell space for advertisers. Just look Google, this really works. For some. But do you want to put those “enlarge your…” – texts there?
7. Sell your user data. Be evil. Look at Facebook ;) Unfortunately you really need traffic before this is really possible (and FB probably does it so much better than you do).
8. Get funding / investments. Okay, after this we start to swim in a deep water.
9. Get acquired. Instagram-style!
10. Sell something, like fan products. Many of the webcomics do just this.
Other ideas? I’m really interested in hearing them! :)
I’m more of those “hands on”-people, so I really don’t understand how some IT-startups are going to make profit at all as they are doing free stuff for people. As said, I don’t see that as a business but a charity ( / stupidity). And companies’ purpose is to make money, so….
And now people: nothing is really free. Honestly, are some really forbidding ads / user data collection because it isn’t nice? Well, then they should also understand that many wonderful things that are now free, will vanish. Either we have to start to pay up, or there will be no way to keep them up and running.
- 23.04.2012 Added point #3 (pay-per-use).
- 24.04.2012 Fixed typos...
- 23.05.2012 Added point #10. Not sure how I didn't remember that one when I wrote the text in the first place.... :)