Under the Radar

00:00:00 ◼   ► welcome to under the radar a show about

00:00:01 ◼   ► independent iOS app development I'm

00:00:03 ◼   ► Marco Arment and I'm David Smith under

00:00:06 ◼   ► the radar is never longer than 30

00:00:07 ◼   ► minutes so let's get started so I am in

00:00:11 ◼   ► the process of wrapping up development

00:00:13 ◼   ► on my next app you I'm yes yes another

00:00:17 ◼   ► one it's it's truly shocking and you

00:00:19 ◼   ► know a revelation that I'd be working on

00:00:21 ◼   ► a new app but I am and I'm at the point

00:00:24 ◼   ► now where the app is mostly finished

00:00:29 ◼   ► it's like functionally complete I'm

00:00:31 ◼   ► getting ready to start sort of more

00:00:32 ◼   ► broad testing and that kind of thing and

00:00:34 ◼   ► it's an app that's geared in sort of in

00:00:36 ◼   ► the health and fitness area that I've

00:00:38 ◼   ► been doing recently to sort of join the

00:00:40 ◼   ► ranks of pedometer plus plus and C++

00:00:42 ◼   ► this one's about displaying the activity

00:00:46 ◼   ► and fitness data collected by Apple

00:00:47 ◼   ► watches you know hopefully a more useful

00:00:50 ◼   ► way so I've come through like the part

00:00:53 ◼   ► that I have a lot of comfort with in

00:00:55 ◼   ► terms of sitting down and just building

00:00:57 ◼   ► an app like the actual opening Xcode and

00:00:59 ◼   ► coding that part I always feel good

00:01:01 ◼   ► about but now I'm hitting an interesting

00:01:03 ◼   ► a more challenging part of it at least

00:01:05 ◼   ► for me that I thought it would be

00:01:07 ◼   ► interesting to talk about and that's the

00:01:08 ◼   ► process of working out the business

00:01:11 ◼   ► model that I'm going to ultimately

00:01:13 ◼   ► launch the app with and maybe some

00:01:15 ◼   ► people would think that it would be a

00:01:17 ◼   ► better idea to have the business model

00:01:19 ◼   ► in mind before I make the app but that's

00:01:22 ◼   ► just not the way I work I have an idea I

00:01:24 ◼   ► start building it a few weeks later I

00:01:26 ◼   ► have the app that's just how my process

00:01:29 ◼   ► works so now I hit the point that I have

00:01:31 ◼   ► to decide what am I going to do with

00:01:33 ◼   ► this and you'd think at this point like

00:01:37 ◼   ► I've been doing this for long enough and

00:01:38 ◼   ► I've launched enough apps that I would

00:01:40 ◼   ► just like immediately know what it isn't

00:01:42 ◼   ► going to do but I kind of awkward

00:01:45 ◼   ► reality as I looked at it and I'm like I

00:01:46 ◼   ► don't really know what I want to do for

00:01:48 ◼   ► this app like I could make it do do so

00:01:51 ◼   ► many different things like the number of

00:01:53 ◼   ► options available to app developers

00:01:55 ◼   ► these days is kind of wild in terms of

00:01:58 ◼   ► it's not just like an older sort of like

00:01:59 ◼   ► the old days where it's like you could

00:02:01 ◼   ► have a paid app or a free app or like

00:02:03 ◼   ► push it free with ads and then like the

00:02:05 ◼   ► introduced you know purchase and

00:02:06 ◼   ► originally in a purchases were only in

00:02:07 ◼   ► paid apps and so you could have like

00:02:09 ◼   ► extra what they call like pay mia maps

00:02:11 ◼   ► and

00:02:11 ◼   ► then they added in a purchase for free

00:02:14 ◼   ► apps we can do that now and this

00:02:16 ◼   ► recently been a whole big wave of

00:02:18 ◼   ► fitness apps being purchased by big

00:02:20 ◼   ► companies and so that's even like this

00:02:22 ◼   ► other kind of vague not like a business

00:02:23 ◼   ► plan but they sort of like a concept of

00:02:26 ◼   ► people are making fitness apps and

00:02:27 ◼   ► eventually being purchased by bigger

00:02:29 ◼   ► companies and making their money that

00:02:30 ◼   ► way and so that leaves me in kind of a

00:02:33 ◼   ► crazy thing and so I what I wanted to do

00:02:34 ◼   ► this week is to sort of think out loud

00:02:38 ◼   ► and get your your your thoughts Marco

00:02:41 ◼   ► about how to proceed and kind of the

00:02:43 ◼   ► considerations and the thoughts that go

00:02:45 ◼   ► into this because I imagine anybody who

00:02:48 ◼   ► is making an app a product something

00:02:50 ◼   ► like that you have to go through this

00:02:51 ◼   ► kind of mentality

00:02:53 ◼   ► to think you know what's ultimately

00:02:55 ◼   ► going to be best for you and the answer

00:02:58 ◼   ► is probably different for everybody

00:02:59 ◼   ► so thinking you know rather than just

00:03:01 ◼   ► giving an answer explaining how I'm

00:03:04 ◼   ► going to hopefully end up with an answer

00:03:06 ◼   ► is probably more helpful so for me I

00:03:09 ◼   ► think that one of the ways to look at

00:03:11 ◼   ► this first off is if you have any any

00:03:14 ◼   ► previous apps that you've made

00:03:16 ◼   ► especially anything you've made in

00:03:17 ◼   ► recent years you know since the economy

00:03:19 ◼   ► always changes in the App Store any

00:03:21 ◼   ► parallels you could draw from other apps

00:03:23 ◼   ► of like what might be the best pricing

00:03:25 ◼   ► model for like you know a similar app

00:03:27 ◼   ► that you've made and how that's done

00:03:29 ◼   ► sure and probably the closest have to

00:03:32 ◼   ► this is it's really it's out of all my

00:03:35 ◼   ► apps it's certainly going to be

00:03:35 ◼   ► pedometer plus plus or sleep plus plus

00:03:37 ◼   ► which are fitness apps and probably in

00:03:40 ◼   ► many ways sleep plus plus is the actual

00:03:43 ◼   ► a pedometer plus plus or in the early

00:03:44 ◼   ► days have the same thing where like

00:03:46 ◼   ► because it's an app that's tied to a

00:03:48 ◼   ► particular platform like in when

00:03:51 ◼   ► pedometer plus plus launched it was tied

00:03:53 ◼   ► to the iPhone 5s and if you didn't have

00:03:55 ◼   ► a 5s it was worthless to you and in you

00:03:58 ◼   ► asleep plus plus if you don't give an

00:03:59 ◼   ► Apple watch it's useless to you and we

00:04:01 ◼   ► had this new app if you don't have an

00:04:02 ◼   ► Apple watch it's not really gonna be

00:04:04 ◼   ► able to show you anything useful so

00:04:05 ◼   ► those are probably like the closest to

00:04:08 ◼   ► the way I do now and those are both free

00:04:10 ◼   ► with ads and an in-app purchase to

00:04:14 ◼   ► remove the ads and in the case of

00:04:16 ◼   ► pedometer plus plus the in-app purchase

00:04:17 ◼   ► is structured as a consumable tip jar

00:04:20 ◼   ► type of thing and in sleep us+ it's just

00:04:23 ◼   ► like a one-time rake

00:04:24 ◼   ► like any net purchase to remove ads with

00:04:27 ◼   ► a nice little message saying thank you

00:04:28 ◼   ► so much and pedometer plus plus does not

00:04:31 ◼   ► have ads at all right it does okay I

00:04:34 ◼   ► didn't it didn't initially launch with

00:04:36 ◼   ► them initially it just launched with the

00:04:38 ◼   ► tip jar but that I introduced ads a

00:04:42 ◼   ► while after a while because the tip jar

00:04:45 ◼   ► while conceptually I liked from a

00:04:48 ◼   ► performance perspective didn't do that

00:04:50 ◼   ► as well at least until I added advert

00:04:53 ◼   ► ads to it and once I added ads like once

00:04:56 ◼   ► there was both the carrot like hey

00:04:58 ◼   ► support me this is great and the stick

00:05:00 ◼   ► of I'm going to show ads in the app

00:05:01 ◼   ► unless you pay like the combination of

00:05:04 ◼   ► those two it led to a much more robust

00:05:07 ◼   ► adoption of the tip jar and so I had it

00:05:10 ◼   ► ads and it's been working much better

00:05:11 ◼   ► since then because otherwise I'd find

00:05:13 ◼   ► sort of the I launched it or I launched

00:05:15 ◼   ► a big update and I'll get this kind of

00:05:16 ◼   ► like this little wave of goodwill and

00:05:18 ◼   ► then it drops to almost nothing and so

00:05:22 ◼   ► that didn't really work in the long run

00:05:23 ◼   ► that makes sense so now it seems like

00:05:27 ◼   ► the the most logical conclusion then if

00:05:30 ◼   ► you say that the new app is most similar

00:05:32 ◼   ► to pedometer plus plus and apps like

00:05:34 ◼   ► this and the pedometer plus plus and

00:05:36 ◼   ► sleep plus plus both have this kind of

00:05:39 ◼   ► you know ads with paid options to remove

00:05:41 ◼   ► them models and they both work pretty

00:05:43 ◼   ► well it seems on the surface that would

00:05:45 ◼   ► be the best choice but with I ad

00:05:48 ◼   ► shutting down this summer then obviously

00:05:50 ◼   ► that there's a wrench into everything

00:05:51 ◼   ► right exactly yeah and like I look at

00:05:53 ◼   ► this and it's it's more complicated both

00:05:56 ◼   ► because of that and also because in a

00:05:59 ◼   ► weird way I also want like I kind of

00:06:01 ◼   ► want diversity in my in my income stream

00:06:04 ◼   ► and so like having everything be the

00:06:06 ◼   ► same model sometimes it makes me wonder

00:06:08 ◼   ► if that's problematic like if all of my

00:06:10 ◼   ► money is coming from ads I mean it's

00:06:12 ◼   ► sort of in the same way that like fair

00:06:13 ◼   ► enough I can move to another advertising

00:06:15 ◼   ► platform but you know if a there was

00:06:18 ◼   ► some App Store policy change for example

00:06:20 ◼   ► that changed the types of advertising

00:06:22 ◼   ► that was that were allowed and it led to

00:06:25 ◼   ► you know essentially meant that

00:06:27 ◼   ► advertising rates collapsed like if all

00:06:29 ◼   ► my income is coming from advertising

00:06:30 ◼   ► then it's probably problematic or if the

00:06:35 ◼   ► types of ads that are available you know

00:06:38 ◼   ► become more and more skeezy and crumby

00:06:40 ◼   ► then I can like and if my entire like

00:06:44 ◼   ► business is based on that like that's

00:06:46 ◼   ► not a great position either and so I end

00:06:48 ◼   ► up with this weird thing if it's like

00:06:50 ◼   ► there's a lot of things that I could do

00:06:51 ◼   ► and when I was taking a step back and

00:06:54 ◼   ► thinking in preparing for this episode I

00:06:56 ◼   ► kept finally coming back to is it's like

00:06:58 ◼   ► ultimately I have to decide and this is

00:06:59 ◼   ► like really I think that like you can

00:07:01 ◼   ► build and a business models to do what

00:07:03 ◼   ► like one of four things you can either

00:07:05 ◼   ► like maximize the money that you get now

00:07:08 ◼   ► you can maximize the reliability of

00:07:12 ◼   ► income you'll get later you can maximize

00:07:15 ◼   ► the overall money the app will ever

00:07:18 ◼   ► receive in its lifetime or you can try

00:07:21 ◼   ► and maximize your user base which one of

00:07:24 ◼   ► those things will vary dramatically

00:07:26 ◼   ► dependent like will then decide which

00:07:28 ◼   ► business model makes most sense for you

00:07:30 ◼   ► because okay if I want the most money

00:07:32 ◼   ► now well I should probably do like a

00:07:34 ◼   ► paid app just like charge money up front

00:07:36 ◼   ► hope for a little bit of press when the

00:07:38 ◼   ► app launches you know kind of get a big

00:07:40 ◼   ► big push have a couple of days with nice

00:07:43 ◼   ► big sales and then it'll likely fall off

00:07:46 ◼   ► pretty dramatically least that's my

00:07:49 ◼   ► experience is that you end up with this

00:07:50 ◼   ► very steep drop-off afterwards but you

00:07:53 ◼   ► know in that first couple in that first

00:07:54 ◼   ► cut in the first week or so you can

00:07:56 ◼   ► actually make quite a lot more than you

00:07:59 ◼   ► would probably be able to make from any

00:08:00 ◼   ► of the other models and so you can make

00:08:02 ◼   ► it now and like if I want reliable

00:08:04 ◼   ► income something like advertising is

00:08:06 ◼   ► great because it's there's no not there

00:08:09 ◼   ► isn't kind of like this one time

00:08:11 ◼   ► purchase nature to it where people just

00:08:13 ◼   ► keep every time they open the app I make

00:08:16 ◼   ► you know a fraction of a penny and so

00:08:18 ◼   ► the more if people keep using the app

00:08:20 ◼   ► there continues to be money coming in

00:08:23 ◼   ► like overall revenue is probably going

00:08:25 ◼   ► to be some combination of them like

00:08:28 ◼   ► where it's like I'm gonna do everything

00:08:29 ◼   ► I'm gonna have ads I'm gonna have in-app

00:08:32 ◼   ► purchases to remove ads I may have NF

00:08:34 ◼   ► purchases to do features like do

00:08:37 ◼   ► everything you could possibly do to try

00:08:38 ◼   ► and maximize things and then if I wanted

00:08:40 ◼   ► to like Matt just maximize the user base

00:08:42 ◼   ► well then kind of take the VC model and

00:08:44 ◼   ► say you know

00:08:45 ◼   ► just make it free like in hope that

00:08:48 ◼   ► you'll work something out down the road

00:08:49 ◼   ► like if once you have you know hundreds

00:08:52 ◼   ► of thousands of customers using the app

00:08:53 ◼   ► all the time then hey that's got to be

00:08:56 ◼   ► worth something to someone right yeah I

00:08:58 ◼   ► mean so I think so you know with

00:08:59 ◼   ► overcast I obviously chose the pretty

00:09:02 ◼   ► much the latter option but you know

00:09:04 ◼   ► pretty much make it free at first I had

00:09:07 ◼   ► like you know free with unlock to get

00:09:09 ◼   ► all features now it's pretty much

00:09:11 ◼   ► everything's free and and you you know

00:09:13 ◼   ► you you pay if you feel like it which is

00:09:16 ◼   ► almost like everything's free and the

00:09:20 ◼   ► reason I did that was because I've

00:09:21 ◼   ► wanted to maximize the user base really

00:09:23 ◼   ► you know I have I have like political

00:09:24 ◼   ► goals with with how I feel about how

00:09:27 ◼   ► podcasting apps should and shouldn't be

00:09:28 ◼   ► designed and I you know I want to like

00:09:31 ◼   ► keep podcasting open and and you know

00:09:33 ◼   ► reduce the influence of proprietary

00:09:35 ◼   ► gatekeepers and everything and so for me

00:09:37 ◼   ► it was important to maximize the user

00:09:39 ◼   ► base first and then figure out money

00:09:41 ◼   ► with that in mind like you know not

00:09:43 ◼   ► necessarily later because I didn't delay

00:09:45 ◼   ► making money but just like figure out a

00:09:48 ◼   ► way to make money while also giving away

00:09:50 ◼   ► as much as possible for free and so you

00:09:53 ◼   ► know that that's the model I chose that

00:09:55 ◼   ► though you know that was in the context

00:09:57 ◼   ► of this entire ecosystem that had these

00:09:59 ◼   ► other factors that I was playing to in

00:10:02 ◼   ► in your situation here with this app you

00:10:04 ◼   ► know with every app certain models will

00:10:07 ◼   ► work better than others you know and and

00:10:09 ◼   ► it depends so much on what the app is

00:10:10 ◼   ► what the competition is how your market

00:10:13 ◼   ► timing is you know what you know what

00:10:15 ◼   ► the market is itself so something like

00:10:18 ◼   ► pedometer plus plus that was that

00:10:20 ◼   ► initially a paid app or was it always

00:10:22 ◼   ► free upfront it's always free cuz it's

00:10:23 ◼   ► because of in especially it was free

00:10:26 ◼   ► because it required an iPhone 5s and

00:10:28 ◼   ► there was no way that I could require

00:10:30 ◼   ► you to have one before you purchased it

00:10:32 ◼   ► and so I made it free because I was

00:10:35 ◼   ► afraid that there would be lots of

00:10:36 ◼   ► people who would pay for it and then

00:10:39 ◼   ► immediately discover that it's worthless

00:10:41 ◼   ► and go and get a refund or leave a

00:10:43 ◼   ► one-star review and so it just never

00:10:45 ◼   ► seemed like paid would be a viable

00:10:47 ◼   ► option right and so therefore the same

00:10:50 ◼   ► thing applies to this then because this

00:10:51 ◼   ► requires an Apple watch so you know it's

00:10:53 ◼   ► or what does it officially require it

00:10:55 ◼   ► isn't you know basically it basically

00:10:56 ◼   ► requires it right it basically record

00:10:58 ◼   ► everybody it would be fairly useless

00:10:59 ◼   ► that one right exactly so it seems like

00:11:02 ◼   ► paid is right out the window which is

00:11:04 ◼   ► unfortunate because actually something

00:11:06 ◼   ► like this where you're saying like you

00:11:08 ◼   ► know it's taking advantage of something

00:11:10 ◼   ► new it's something that is a that is a

00:11:12 ◼   ► small market there's probably going to

00:11:14 ◼   ► be very little competition out there at

00:11:16 ◼   ► least at first so that kind of condition

00:11:18 ◼   ► usually is a really good fit for paid

00:11:21 ◼   ► where you have people who are going to

00:11:23 ◼   ► be motivated to get it and very little

00:11:25 ◼   ► competition really and and especially it

00:11:28 ◼   ► being new well that combination usually

00:11:30 ◼   ► means go paid upfront because you kind

00:11:34 ◼   ► of have to be free up front because we

00:11:35 ◼   ► don't have real trials this would be a

00:11:38 ◼   ► man this would be a great case for a

00:11:39 ◼   ► trial but but those don't exist so

00:11:41 ◼   ► instead you have to be free somewhat so

00:11:44 ◼   ► the only question now is whether you

00:11:46 ◼   ► lock some features whether you use ads

00:11:49 ◼   ► or whether you just don't think about

00:11:50 ◼   ► money with this app and use it for other

00:11:51 ◼   ► purposes like promoting your other stuff

00:11:53 ◼   ► or giving back to the world or whatever

00:11:56 ◼   ► so going through those one by one I

00:11:58 ◼   ► guess free with unlock is tricky certain

00:12:03 ◼   ► apps there just really isn't a good

00:12:04 ◼   ► place to put that locking barrier so

00:12:07 ◼   ► like one of the examples I know I think

00:12:09 ◼   ► James Thompson talked about this a while

00:12:11 ◼   ► ago with P calc is you know where do you

00:12:13 ◼   ► if you have a calculator that you want

00:12:16 ◼   ► to be free upfront with a paid app

00:12:18 ◼   ► purchase to unlock something what do you

00:12:20 ◼   ► unlock like the nine button like it's

00:12:22 ◼   ► it's hard it's like certain apps are

00:12:24 ◼   ► just hard to figure out where to place

00:12:26 ◼   ► that barrier in a way that the app isn't

00:12:29 ◼   ► totally useless without it but that

00:12:31 ◼   ► enough people will hit that barrier and

00:12:33 ◼   ► be motivated to pay and certain apps the

00:12:36 ◼   ► answer is just this doesn't fit well and

00:12:38 ◼   ► there isn't a good place for it and

00:12:40 ◼   ► certain apps you know there are plenty

00:12:41 ◼   ► of places for it and the question is

00:12:43 ◼   ► where do you put it and so in this case

00:12:45 ◼   ► do you think there's a good spot to have

00:12:48 ◼   ► a paid unlock like there's a good

00:12:50 ◼   ► feature or set of features or limit that

00:12:52 ◼   ► can be removed where enough people will

00:12:56 ◼   ► hit that and want to pay but they won't

00:12:58 ◼   ► hate you because it's so annoying every

00:13:00 ◼   ► time they hit it the only one that comes

00:13:03 ◼   ► to mind for an app like this is to do

00:13:05 ◼   ► with some type of kind of artificial

00:13:07 ◼   ► limit

00:13:08 ◼   ► the amount of data that it will display

00:13:12 ◼   ► so you'd have something you know it's

00:13:14 ◼   ► sort of like being the same with like

00:13:15 ◼   ► pedometer plus balls like it shows you

00:13:16 ◼   ► historical data it would be like you can

00:13:19 ◼   ► only see the current week unlock to see

00:13:21 ◼   ► all kind of a thing

00:13:24 ◼   ► is the only thing that I could sort of

00:13:26 ◼   ► see because partitioning the feature set

00:13:29 ◼   ► or the functionality in other ways like

00:13:30 ◼   ► it feels so contrived like feels much

00:13:33 ◼   ► more like the yeah like you don't use

00:13:35 ◼   ► like you can do multiplication but you

00:13:37 ◼   ► can't do division like that right

00:13:39 ◼   ► exactly

00:13:40 ◼   ► it completely kind of removes the point

00:13:43 ◼   ► of the app if you start partitioning the

00:13:45 ◼   ► features and so the only way I could

00:13:46 ◼   ► ever really I could have a kind of

00:13:48 ◼   ► imagine is to say like hey I'm only

00:13:50 ◼   ► going to show you this amount of data

00:13:51 ◼   ► you know if you scroll beyond that

00:13:52 ◼   ► there'll be a little box that says hey

00:13:54 ◼   ► would you like to see the rest of your

00:13:55 ◼   ► data you know I'm holding it hostage for

00:13:57 ◼   ► $2 at the bottom

00:14:00 ◼   ► yeah and that's that's so tricky to do

00:14:02 ◼   ► while also balancing like the users will

00:14:05 ◼   ► to pay you because it's so easy to just

00:14:07 ◼   ► appear really stingy or annoying or

00:14:10 ◼   ► cheap with what you give them for free

00:14:11 ◼   ► and what you don't and if they don't

00:14:13 ◼   ► feel good about your app they usually

00:14:16 ◼   ► won't pay to get past that barrier some

00:14:18 ◼   ► people still will and they will hate you

00:14:19 ◼   ► for it I've done that before with some

00:14:22 ◼   ► apps like sometimes for like I really

00:14:24 ◼   ► needed it to get my job done and they

00:14:26 ◼   ► offered a free trial and I kept hitting

00:14:29 ◼   ► walls and I just eventually I did pay in

00:14:32 ◼   ► a lot of these cases and I but I just

00:14:34 ◼   ► felt terrible I felt like I hated them

00:14:36 ◼   ► for it and that kind of soured me on the

00:14:38 ◼   ► whole company and on you know like their

00:14:40 ◼   ► future products or my experience with

00:14:42 ◼   ► the app or my willingness to recommend

00:14:43 ◼   ► it to others so it's always a hard

00:14:45 ◼   ► balance when you whenever you have these

00:14:46 ◼   ► barriers but that being said if you have

00:14:49 ◼   ► an app where a barrier like this makes

00:14:53 ◼   ► sense and where you where you can find a

00:14:54 ◼   ► good place for it and you implement that

00:14:56 ◼   ► well it usually is a really good way to

00:14:59 ◼   ► make a reasonable living like it you can

00:15:01 ◼   ► usually get decent income that way

00:15:03 ◼   ► without a lot of the problems of things

00:15:06 ◼   ► like ads or paid upfront so usually that

00:15:09 ◼   ► that is great when it works but it is

00:15:12 ◼   ► really hard to make it work yeah and I

00:15:14 ◼   ► think one thing that I always struggle

00:15:15 ◼   ► with and I'm trying to think of this

00:15:16 ◼   ► it's like

00:15:18 ◼   ► it's what am i communicating to my

00:15:20 ◼   ► customer because like the hardest part I

00:15:22 ◼   ► think like that you have to get over and

00:15:24 ◼   ► a little bit I think you're alluding to

00:15:25 ◼   ► it for like it makes you feel bad is

00:15:27 ◼   ► when you say like this part of the app

00:15:31 ◼   ► is free like the the initial part like

00:15:34 ◼   ► in typically it's like the core part

00:15:36 ◼   ► like the main purpose of the app is free

00:15:38 ◼   ► and then there's these extra things that

00:15:40 ◼   ► are are like cost more like the weird

00:15:45 ◼   ► thing that you have to keep in mind is

00:15:47 ◼   ► in some ways what you're communicating

00:15:48 ◼   ► to your customer is like the core part

00:15:50 ◼   ► of the app is free or in some ways you

00:15:52 ◼   ► could like it's not a great word but

00:15:54 ◼   ► it's more helpful for this analogy it's

00:15:57 ◼   ► like this part of the app is worthless

00:15:58 ◼   ► and this other part somehow I'm saying

00:16:03 ◼   ► is worth full but if you look at those

00:16:06 ◼   ► as a customer

00:16:08 ◼   ► they may look functionally identical

00:16:09 ◼   ► right it's you're saying like if you

00:16:13 ◼   ► know the ability to do this XY and Z

00:16:15 ◼   ► shouldn't cost you anything and I'm

00:16:18 ◼   ► telling you that it shouldn't cost you

00:16:19 ◼   ► anything to do these things because I

00:16:21 ◼   ► just gave you an app that you downloaded

00:16:23 ◼   ► for free that does those things so I've

00:16:25 ◼   ► communicated to you this is worthless

00:16:27 ◼   ► but you know but this other thing

00:16:30 ◼   ► that is essentially probably very

00:16:31 ◼   ► similar to the other thing and is in

00:16:34 ◼   ► many ways a contrived barrier like

00:16:37 ◼   ► somehow it should be valuable and like

00:16:39 ◼   ► there's a dissonance there that I feel

00:16:41 ◼   ► like is is where it gets really hard

00:16:42 ◼   ► like you can only really make the case

00:16:44 ◼   ► for unlocking something when the thing

00:16:47 ◼   ► that you're paying is like paying for

00:16:49 ◼   ► feels different and like completely

00:16:54 ◼   ► orthogonal to the thing that you the

00:16:57 ◼   ► core part of the thing that you gave

00:16:58 ◼   ► away for free you know so often you'll

00:17:00 ◼   ► have something where there's a physical

00:17:02 ◼   ► cost associated with it like you're

00:17:04 ◼   ► paying for storage or for a sink you

00:17:07 ◼   ► know to access sink or something where

00:17:10 ◼   ► it's not the thing that I gave you for

00:17:12 ◼   ► free just you know like I it's something

00:17:16 ◼   ► totally different in a team's of a

00:17:17 ◼   ► tangible way because when you do that I

00:17:20 ◼   ► think maybe that's where you can get

00:17:21 ◼   ► around that feeling of like I feel bad

00:17:23 ◼   ► about this because I feel like they're

00:17:25 ◼   ► just kind of you know like being cheap

00:17:27 ◼   ► by you know creating this artificial

00:17:30 ◼   ► limit

00:17:31 ◼   ► it's tough too because when you put up a

00:17:33 ◼   ► limit like that people who will hit it

00:17:36 ◼   ► and they will they will try to

00:17:37 ◼   ► rationalize not going past it so though

00:17:39 ◼   ► if you put up a limit and you say well

00:17:41 ◼   ► you can only see the last week of data

00:17:43 ◼   ► or whatever you know whatever limit you

00:17:45 ◼   ► put up yeah people are gonna hit that

00:17:46 ◼   ► and they're first going to think well I

00:17:48 ◼   ► guess I don't need that right like

00:17:50 ◼   ► they're gonna try to convince themselves

00:17:51 ◼   ► they don't need that because they don't

00:17:53 ◼   ► really want to pay so we're gonna try to

00:17:55 ◼   ► say well you know what I can get along

00:17:57 ◼   ► fine without that and even if they would

00:17:59 ◼   ► enjoy the app more with that even if

00:18:01 ◼   ► they would get their $2.00 or whatever

00:18:03 ◼   ► worth of enjoyment or value out of

00:18:06 ◼   ► having gone past that barrier they will

00:18:08 ◼   ► try very hard to convince themselves

00:18:10 ◼   ► even if it's subconscious not to go past

00:18:12 ◼   ► that barrier and so you'll have so many

00:18:14 ◼   ► people who really could use the app who

00:18:16 ◼   ► really could enjoy it a lot more if they

00:18:19 ◼   ► would pay the two bucks but who have

00:18:20 ◼   ► convinced themselves they don't need to

00:18:22 ◼   ► because they would rather not and and

00:18:24 ◼   ► like that's the issue I favor the

00:18:25 ◼   ► overcast that's one of the reasons I

00:18:26 ◼   ► want patron eggs eventually it's just

00:18:28 ◼   ► very hard but I don't know and then we

00:18:30 ◼   ► have we have a lot more better options

00:18:32 ◼   ► or different options at least including

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00:20:16 ◼   ► so there's also ad supported apps to me

00:20:20 ◼   ► like it sounds like it'd be a decent

00:20:22 ◼   ► idea because it sounds like you get

00:20:24 ◼   ► money for when the app is being used and

00:20:27 ◼   ► no one has to decide whether to pay you

00:20:29 ◼   ► or not because the ad is paying you

00:20:31 ◼   ► automatically effectively if they use

00:20:33 ◼   ► the app and they can maybe pay to remove

00:20:35 ◼   ► it or something that's you know that's a

00:20:36 ◼   ► separate discussion which I'm sure we'll

00:20:37 ◼   ► have but at the heart of it you kind of

00:20:40 ◼   ► automatically just get money slowly with

00:20:42 ◼   ► usage of course there's downsides in

00:20:45 ◼   ► practice things like you know privacy

00:20:48 ◼   ► concerns annoyance concerns image

00:20:50 ◼   ► concerns what do you think about after

00:20:51 ◼   ► that yeah it's a it's an uncomfortable

00:20:57 ◼   ► it's like it's like if you may have

00:20:59 ◼   ► noticed that was an uncomfortable intake

00:21:01 ◼   ► of breath yeah because I don't read I

00:21:04 ◼   ► don't like using apps that have ads in

00:21:06 ◼   ► them but I make a substantial amount of

00:21:10 ◼   ► my revenue from ads and like there's a

00:21:14 ◼   ► little bit of cognitive dissidence about

00:21:16 ◼   ► that like it's like the ultimately the

00:21:17 ◼   ► pragmatic part of like this is the

00:21:19 ◼   ► practical way to make revenue but the

00:21:22 ◼   ► reality is I never really like I don't

00:21:24 ◼   ► my app is never made better by having an

00:21:27 ◼   ► ad in it like it's not like oh wow well

00:21:30 ◼   ► it's like people will love it when they

00:21:31 ◼   ► can see ads for other you know for for a

00:21:35 ◼   ► game of war or clash of clans or

00:21:38 ◼   ► whatever like the like the latest

00:21:40 ◼   ► creative play game is like which is

00:21:42 ◼   ► essentially what most online ads seem or

00:21:44 ◼   ► mobile ads seems to be these days

00:21:46 ◼   ► therefore like I don't know those games

00:21:47 ◼   ► or they're for a big brand like audible

00:21:49 ◼   ► or Google or something like that

00:21:51 ◼   ► and so putting those into my apps like

00:21:55 ◼   ► always feels a little bit's not great

00:21:59 ◼   ► but the reality is like like you said

00:22:02 ◼   ► like it works well and I like

00:22:05 ◼   ► conceptually the fact that I'm getting

00:22:08 ◼   ► paid for use in a way that like it's a

00:22:12 ◼   ► really nice virtuous cycle like I want

00:22:14 ◼   ► to make an app that's really engaging

00:22:15 ◼   ► and you wanna you know you want to keep

00:22:18 ◼   ► opening up and looking at you know from

00:22:21 ◼   ► showing you you know health and fitness

00:22:22 ◼   ► data like hopefully it's motivating

00:22:24 ◼   ► hopefully it's something that you want

00:22:25 ◼   ► to go and check on a regular basis and

00:22:27 ◼   ► so aligning a business model with that

00:22:29 ◼   ► where it is something that the more you

00:22:31 ◼   ► use it the more money I make like is

00:22:34 ◼   ► great and in some ways it reminds me

00:22:35 ◼   ► think of the way that like I almost kind

00:22:38 ◼   ► of wish that there were was a mechanism

00:22:41 ◼   ► kind of like quote musicians have with

00:22:45 ◼   ► streaming services oh you don't want

00:22:47 ◼   ► that conceptually I do I don't

00:22:50 ◼   ► necessarily like it breaks down in

00:22:52 ◼   ► certain ways obviously like all these

00:22:54 ◼   ► things do but like conceptually you just

00:22:55 ◼   ► add a bunch of zeros to the number

00:22:57 ◼   ► basically then we want that version of

00:22:58 ◼   ► it that version that version B so is so

00:23:00 ◼   ► great right for the conceptually like

00:23:02 ◼   ► every time someone listens to the song

00:23:03 ◼   ► they get a bit of money and like if

00:23:05 ◼   ► every time someone opens my app I got a

00:23:07 ◼   ► bit of money that would be great

00:23:10 ◼   ► like if the if such a thing sort of

00:23:11 ◼   ► existed like if there was like a breath

00:23:13 ◼   ► and Apple music there was like Apple app

00:23:15 ◼   ► and people paid a certain amount of

00:23:17 ◼   ► money and it was distributed around

00:23:18 ◼   ► people based on what they used or

00:23:20 ◼   ► something right like you could imagine a

00:23:21 ◼   ► system that would sort of work in that

00:23:22 ◼   ► way like it's hugely problematic and I'm

00:23:25 ◼   ► not really advocating for that but like

00:23:27 ◼   ► conceptually a version it would be like

00:23:30 ◼   ► the business model that adds create but

00:23:33 ◼   ► without the potential for kind of like

00:23:36 ◼   ► not desirable aesthetics in my apps so

00:23:40 ◼   ► like that would be great that doesn't

00:23:42 ◼   ► exist and so you end up with ads and you

00:23:46 ◼   ► ultimately I like I end up like most

00:23:48 ◼   ► likely than not that's ultimately what

00:23:49 ◼   ► I'll probably have to do is I look at

00:23:51 ◼   ► and it's like you know if I have ads in

00:23:54 ◼   ► this app I will if it's successful if

00:23:57 ◼   ► it's just downloaded wildly then I will

00:23:59 ◼   ► likely you know make a reasonable amount

00:24:01 ◼   ► of semi reliable income from it

00:24:03 ◼   ► and if P if it's sticky and people

00:24:05 ◼   ► really like it and keep coming back to

00:24:07 ◼   ► it like my revenue will continue to if

00:24:09 ◼   ► not grow at least to stay stable in long

00:24:11 ◼   ► term which is great like see our episode

00:24:13 ◼   ► about work-life balance that we just did

00:24:16 ◼   ► where I talked about like the more you

00:24:18 ◼   ► can make your income kind of like

00:24:21 ◼   ► passive and not related to what you're

00:24:22 ◼   ► doing like the better and so ads are

00:24:25 ◼   ► great for that because it's all based on

00:24:27 ◼   ► work you've done in the past like

00:24:29 ◼   ► continuing to pay you in the future I

00:24:30 ◼   ► just wish it didn't make me feel so kind

00:24:33 ◼   ► of like mmm whenever I do it yeah and it

00:24:37 ◼   ► seemed like with ads like you could do

00:24:39 ◼   ► something crazy like direct sales of ads

00:24:41 ◼   ► but that's a lot of work it's the best

00:24:44 ◼   ► for like privacy maximization really and

00:24:46 ◼   ► it might be the classiest but that's a

00:24:48 ◼   ► ton of work and as you go like kind of

00:24:50 ◼   ► down the rabbit hole I'm like well I

00:24:51 ◼   ► could join a network and then you know a

00:24:54 ◼   ► small app network if that existed which

00:24:57 ◼   ► I don't even know if it does but you

00:24:58 ◼   ► know assuming that existed up then then

00:25:00 ◼   ► we pool resources selling ads is a

00:25:02 ◼   ► little bit easier I've maybe I don't

00:25:03 ◼   ► have to do it anymore or I can I can you

00:25:05 ◼   ► know share a salesperson with somebody

00:25:06 ◼   ► else and as you get further down it's

00:25:08 ◼   ► like well all these things are a lot of

00:25:09 ◼   ► work until you get down to the well I

00:25:12 ◼   ► can just plug in a module from a big ad

00:25:15 ◼   ► provider where I might not have even

00:25:18 ◼   ► beat I might not have even dealt with a

00:25:19 ◼   ► human at all to be part of this thing

00:25:21 ◼   ► you're getting who knows what ads from

00:25:23 ◼   ► who knows where and they're doing who

00:25:25 ◼   ► knows what with your customers private

00:25:26 ◼   ► privacy and data but that's also the

00:25:28 ◼   ► easiest for you I like that and so like

00:25:31 ◼   ► with ads you like the the incentives are

00:25:34 ◼   ► all towards getting creepier and

00:25:36 ◼   ► creepier because the the easiest ways to

00:25:38 ◼   ► get into ads and the most accessible

00:25:40 ◼   ► ways against ads happen to also be the

00:25:43 ◼   ► worst about privacy and customer data in

00:25:45 ◼   ► most cases whereas you know anything

00:25:47 ◼   ► better than that tends to take more work

00:25:49 ◼   ► than most people can really devote to it

00:25:51 ◼   ► exactly and that guy in my first ever

00:25:54 ◼   ► foray into ads I did actually sell them

00:25:57 ◼   ► direct like this was like way back early

00:25:59 ◼   ► days of the app store because like ad

00:26:01 ◼   ► networks didn't exist and like I would

00:26:04 ◼   ► sell ads to you typically was to other

00:26:06 ◼   ► app developers at very small very small

00:26:09 ◼   ► amounts of money but it's like that was

00:26:12 ◼   ► the best you could do back then but now

00:26:14 ◼   ► yeah like you would just you install

00:26:16 ◼   ► I add for the next couple of months or

00:26:19 ◼   ► you know AdMob from Google or any of the

00:26:21 ◼   ► million things like see our previous

00:26:23 ◼   ► episode about ads where there's like so

00:26:24 ◼   ► many networks and all kinds of things

00:26:26 ◼   ► and you just kind of put it in and like

00:26:29 ◼   ► in theory like and then money will start

00:26:31 ◼   ► flowing and like that's great it's like

00:26:33 ◼   ► in some ways this is an area though with

00:26:35 ◼   ► like some you know the last version of

00:26:37 ◼   ► like business model that I probably

00:26:39 ◼   ► doesn't really fit from what I do but is

00:26:41 ◼   ► interesting nevertheless is I am kind of

00:26:42 ◼   ► envious of venture funded companies in

00:26:45 ◼   ► this regard because they don't have a

00:26:47 ◼   ► business model like they don't need well

00:26:50 ◼   ► they have a different business model

00:26:50 ◼   ► therapist this model is get really huge

00:26:53 ◼   ► and worry about it later even though

00:26:55 ◼   ► that usually means probably get bought

00:26:57 ◼   ► before we have to worry about it exactly

00:26:59 ◼   ► which is a business model it's just

00:27:00 ◼   ► different for what we do yeah and like I

00:27:02 ◼   ► look at that and I'm like in some ways

00:27:03 ◼   ► that's actually kind of cool like to be

00:27:04 ◼   ► able to just say like you know what I'm

00:27:05 ◼   ► just gonna focus on making something

00:27:07 ◼   ► cool and getting as many people as I can

00:27:10 ◼   ► to use it and I don't need to worry

00:27:12 ◼   ► about the financial part of that and in

00:27:15 ◼   ► some ways like that's kind of

00:27:16 ◼   ► interesting like I've definitely had the

00:27:19 ◼   ► thought for some something like this of

00:27:20 ◼   ► saying like you know what if I just went

00:27:21 ◼   ► to like took that tack and like hope you

00:27:25 ◼   ► know it's like MyFitnessPal got bought

00:27:27 ◼   ► by Under Armour RunKeeper got bought by

00:27:30 ◼   ► a6 like at some point is good COO you

00:27:33 ◼   ► know if I was able to make some make a

00:27:35 ◼   ► like a wildly successful health and

00:27:38 ◼   ► fitness app that could it be picked up

00:27:39 ◼   ► by some other company for you know it's

00:27:41 ◼   ► probably in some ways more money than I

00:27:43 ◼   ► could ever make from you know running

00:27:44 ◼   ► AdMob ads in an application like that

00:27:48 ◼   ► sounds kind of interesting it's like the

00:27:51 ◼   ► risk dynamic on that just like goes

00:27:53 ◼   ► through the roof where it's like or I

00:27:54 ◼   ► could end up with having made this cool

00:27:56 ◼   ► thing that ends up making me no money

00:27:58 ◼   ► ever and that's kind of terrifying as

00:28:01 ◼   ► well yeah all right well what do you

00:28:05 ◼   ► think you're gonna do I have um have you

00:28:06 ◼   ► come to any conclusions or you still

00:28:07 ◼   ► gotta think about it I'm still gonna

00:28:09 ◼   ► think about it I'm probably gonna do at

00:28:12 ◼   ► like I think my default is gonna be ads

00:28:14 ◼   ► like I don't think paid works

00:28:16 ◼   ► I don't think unlocking features really

00:28:18 ◼   ► works like I don't like the thought of

00:28:20 ◼   ► right and to clarify it really works for

00:28:22 ◼   ► this app on both exactly the whole point

00:28:25 ◼   ► of this discussion is like whether it

00:28:26 ◼   ► works in this particular case and like

00:28:28 ◼   ► the reason we're going through it step

00:28:29 ◼   ► by step

00:28:30 ◼   ► that every app is different this is why

00:28:32 ◼   ► this may or may not make sense for this

00:28:34 ◼   ► app ads are like the easy thing I don't

00:28:38 ◼   ► feel great about them but I think they

00:28:40 ◼   ► are sort of like the obvious and

00:28:41 ◼   ► straightforward choice I'll most

00:28:43 ◼   ► certainly have an option to remove the

00:28:46 ◼   ► ads I'm just in terms of that's often

00:28:48 ◼   ► just it makes me feel better maybe it's

00:28:50 ◼   ► like it's just like cleansing my

00:28:51 ◼   ► conscience a little bit about not having

00:28:53 ◼   ► ads to say like so you know like if you

00:28:55 ◼   ► don't like them that's fine then it's

00:28:56 ◼   ► just a paid app and you can give me

00:28:58 ◼   ► money and we'll go away and if I'm

00:29:01 ◼   ► feeling particularly daring or a little

00:29:03 ◼   ► bit reckless in wild then maybe I just

00:29:04 ◼   ► make it free but being a one-person shop

00:29:07 ◼   ► who pays my mortgage with the revenue

00:29:10 ◼   ► from my apps not having any revenue does

00:29:13 ◼   ► not seem particularly wise yeah all

00:29:16 ◼   ► right well that's all the time we have

00:29:18 ◼   ► for today thanks a lot to our sponsor

00:29:19 ◼   ► hover and we will talk to everybody next

00:29:21 ◼   ► week bye