August 13, 2017

Software: Your power tools are made in sweatshops.

Ulysses, a popular text editor for Mac and iOS, just changed over to a subscription model at a pricey $40 a year. I'm happy to say that the price guarantees that this app will not be made in a sweatshop. Hear me out on this.

It's often not evident to someone complaining about paying too much for a 99¢ app that a human being sweated over that app. They probably put hundreds of hours into development and may now spend hundreds more answering support emails. And we haven't yet gotten to the time required to update the app with no further compensation.

Even when the developer of a successful app charges $10 for it, that doesn't even pay for an hour of development time and an hour of support time at minimum wage. In that light, it's easy to see why so many great apps get abandoned. The developer may have created it from a passion, but finds there's better pay in a sweatshop.

We're paying too little for our tools.

As far as software is concerned, we've gotten a free ride. The launch of iOS created an industry of underpriced apps. Developers who were building Mac apps and selling them for $20-30 found they struggled to get $5 for the app on iOS, even though both probably required the same amount of development time. And here we are 10 years into iOS and we're still underpaying for those apps we rely on. As consumers we're used to getting the Walmart price on everything, but we're willing to pay even less for our software.

Why those great apps die.

There are a lot of apps that are dogs out there and not worth 99¢. But the problem is that developers of great apps are not making enough to keep at it. No wonder so many apps disappear from the App Store or haven't been updated in 5 years. Recently I talked to the developer of a very cool photo app. He noted that he makes less than a dollar a day off the app in new sales now, which has made buying the tools he needs to create the app not feasible. So he can't update the app, it struggles on new iOS updates, ratings go down and sales continue to drop. But then we complain when these great apps die, despite the fact that we usually get well more than our money's worth out of them.

Why sustainable models are so costly.

Ulysses is not a 99¢ app. They charged substantially more: $45 for the Mac app and $20 for iPad. So the price leap to a subscription model was not much of a leap, if any. As a company, Ulyssees will probably not spend this subscription money on building employee nap rooms, employing a staff gourmet chef or taking team building trips to Tahiti. They seem to be a well-run business. Recently they adjusted their business model to focus exclusively on Ulysses, their most successful app. Marcus Fehn and Max Seeleman made the wise choice in devoting all their resources to their core business. They also made a wise choice in moving to a subscription model. It gives them a consistent (but not much bigger) revenue stream, so they can focus on a more consistent product with deeper, under-the-hood updates. These will that make Ulysses an even more dependable and more depended on software. However, that does cost money.

Let's do the math on this: According to the Ulysses site they have 12 employees. So if we multiply that by the German minimum wage of $9.79 an hour, the company would shell out about $250,000 a year in salaries. But those are sweatshop wages. You can't keep the best employees for that. For argument sake, let's double it: half a million dollars a year. Then there's the other business costs: the office, computers, benefits, etc. Running even a lean company that size can easily hit a million dollars a year. At the new subscription rate, that's 25,000 subscriptions they need at full price just to break even. As you can see, a sustainable software company can live off 99¢ apps, even if they produce a hundred of them. And to grow, software companies today pretty much require a sustainable model.

Is $40 a year too much?

Probably not. Microsoft and Adobe both made their initial billions off pricey update business models, but are now gravitating to pricey Office 365 and Creative Cloud subscription models. Do users feel they're overpaying these companies? Yes. Are most willing to give up the software for cheaper competitive products? No, probably not. These are necessary tools: the cost of admission for doing the work they do. Though you're not hearing many of the voices of those willing to pay for a Ulysses subscription, it's a necessary business tool for them, and me. Paying the $30-40 a year ensures those who continue to use Ulysses will get an app that improves and becomes more valuable to its users. And this model will ultimately lead to more users as quality continues to improve.

The new model gets a big thumbs down.

So far, the comments to the original post about Ulysses new subscription model are overwhelmingly negative. As Marcus noted on Twitter "Thanks, everyone, for yesterday’s debate. Was good getting some insight without having to dig beneath a thick cover of hate. :)" However, when you read between the lines of these comments, you'll notice a trend: most of the people saying "auf wiedersehen" to Ulysses—are casual users, not power users. It's understandable why they're miffed: They paid a lot for Ulysses, but don't appear to use it that much. In their anger, these commenters are revolting by seeking out alternatives. The new Bear for Mac and iOS is one. Incidentally, Bear is $14.99 a year (not pricey) but its also a dreaded subscription model that these commenters say they refuse to pay for. (If you really want an solid, inexpensive, non-subscription text editor, try the well-seasoned Byword for Mac and iOS. $18 for both. I'm typing this on it now.)

The Scrivener bandwagon.

I find it interesting that the overwhelming cry in comments is that people are jumping ship and buying Scrivener for Mac and iOS because it doesn't have a subscription model. Scrivener, from the fine team at Literature and Latte is an excellent competitor to Ulysses, but when you do the math, both versions of Scrivener together costs $65 (the same as Ulysses used to cost.) If you already own Ulysses, you get $10 off your annual fee forever. So two years of subscribing to Ulysses is still cheaper than buying both versions of Scrivener. And it should be noted that Scrivener 3 is in the offing according to developer Keith Blount, so switching to Scrivener and using it over the next three years—will roughly cost what a three-year subscription to Ulysses costs. It's also interesting that so many of those jumping off Ulyssees' boat seemed to think Scrivener was too expensive, or they would have already owned it. I do hope those who adopt Scrivener will find an app they love and will not be outraged when they're faced with paying for new features in version 3. After all, Keith has seven employees to pay too.

Why I'm sticking with Ulysses.

There are a few reasons. First, I'm tired of underpriced apps going away. I used a great writing app called Daedalus Touch to write and compile my eBook The Crap-Free Guide to Twitter Success. But that exquisite, four-dollar app went away because it didn't have a sustainable model.

Ironically, Daedalus Touch was created by The Soulmen, the company that became Ulysses. In fact, Daedalus Touch was essentially the first stab at an iOS companion app for Ulysses. While Daedalus Touch is no longer available, I know my subscription to Ulysses is more likely to keep the app alive as long as I'm writing.

The second reason I'm sticking with Ulysses is that my dependence on the app is growing. It's the only iPad app I've found that can easily create iTunes bookstore compatible ePubs. The Crap-Free Guide to iPhone Photography was published entirely with Ulysses on iPad. As I add more books to my line, they'll be written, edited, revised and published with Ulysses too. So I paid for my subscription to Ulysses the first day.

I've always said: if there is a free lunch in tech, it won't last until dessert. We're used to getting things like 99¢ apps at sweatshop prices, only to cry about them being abandoned because they're not sustainable. What it comes down to, is that sooner or later, you get what you pay for. And when it comes to good tools, we really shouldn't be reluctant to pay for them.


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