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Looks like we've got some interesting thoughts from Marco. Seems like he regrets keeping Instapaper a paid app and not making it free to go after marketshare a
by dave1619 11y ago
Looks like we've got some interesting thoughts from Marco.
Seems like he regrets keeping Instapaper a paid app and not making it free to go after marketshare and take on Pocket. He seems to conclude he "lost" against Pocket, and now doesn't want to make the same mistake with Overcast.
I personally don't think the patronage model will go very far. I think he's doing more to make the full app free and gain marketshare, and any money made by "donations" is just bonus. If he can grow his marketshare and get a lot of users, then it looks like he's going to try to raise funds. So, this business model makes sense for now... at least until he's able to raise outside funds.
Overall, Marco seems to be insinuating that the podcast market is bigger than people think, and VC money is going to enter the space; thus, he wants to prepare for that and maximize the potential for his app and the possibility to raise funds and go really big.
It does seem that when VC funds enter a market it presents a challenge to existing indie developers who are making a living with a paid app. The VC-funded company will provide a great app (usually) for free, since they don't need a monetization stream right away. They usually are aiming to build a big audience and then monetize later.
Indie developers are then faced with a decision. How do they compete with VC funded companies? They likely are going to have to either make their app free and go head-to-head with these VC funded companies (and maybe raise money themselves to do so). Or they can narrow their scope and become more niche apps appealing to a more limited audience with high-end (hard-to-copy) features that might not appeal to the masses but to the minority who might pay.
But overall, Marco's blog post does bring up the challenges indie developers face when VC funded companies enter their space.
Would love to hear more thoughts on this.
- x0x0 11y agoBut let's assume we're not in a bubble, so raising funds isn't an end in and of itself. Where does the money come from to give investors a return when the entire app is free?
- seiji 11y agoHow did whatsapp's investors get a return? Sure, they had some income, but not enough to "pay back" investors. But, lo and behold, sugar daddy comes along and drops some of that high fructose acquisition syrup on their heads. The best business model is still: make rich people afraid of you so they'll do anything to shut you up or control you.
- Touche 11y agoAds of course.
- shalmanese 11y agoPodcast advertising is fantastically profitable even though it's extremely unsophisticated. As the profit margins shrink due to increased competition, more sophisticated ad formats are going to come along to keep the lights on. Right now, every podcast listener hears the exact same ad regardless of where or when they are listening. It seems obvious that at some point soon, podcasts will include a custom code for "insert ad here" and an ad exchange will bid on that 30 second spot and put a targeted ad there. Currently, the MP3 + RSS format of podcasts doesn't support this degree of sophistication which is what Marco is alluding to with it's walled gardens comment. There's a goldmine for whoever can figure out how to move podcasts into a vertically integrated format and define the platform.