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To push back against this sentiment: “chasing AI money” isn’t necessarily their thought process here; i.e. it’s not the only reason they would “switch to a free
by derefr 1y ago
To push back against this sentiment: “chasing AI money” isn’t necessarily their thought process here; i.e. it’s not the only reason they would “switch to a freemium model trying to get you to subscribe to AI.”
Keeping in mind that:
1. “AI” (i.e. large ML model) -driven features are in demand (if not by existing users, then by not-yet-users, serving as a TAM-expansion strategy)
2. Large ML models require a lot of resources to run. Not just GPU power (which, if you have less of it, just translates to slower runs) but VRAM (which, if you have not-enough of it, multiplies runtime of these models by 10-100x; and if you also don't have enough main memory, you can't run the model at all); and also plain-old storage space, which can add up if there are a lot of different models involved. (Remember that the Affinity apps have mobile versions!)
3. Many users will be sold on the feature-set of the app, and want to use it / pay for it, but won't have local hardware powerful enough to run the ML models — and if you just let them install the app but then reveal that they can't actually run the models, they'll feel ripped off. And those users either won't find the offering compelling enough to buy better hardware; or they'll be stuck with the hardware they have for whatever reason (e.g. because it's their company-assigned workstation and they're not allowed to use anything else for work.)
Together, these factors mean that the "obvious" way to design these features in a product intended for mass-market appeal (rather than a product designed only "for professionals" with corporate backing, like VFX or CAD software) is to put the ML models on a backend cluster, and have the apps act as network clients for said cluster.
Which means that, rather than just shipping an app, you're now operating a software service, which has monthly costs for you, scaled to aggregate usage, for the lifetime of that cluster.
Which in turn means that you now need to recoup those OpEx costs to stay profitable.
You could do this by pricing the predicted per-user average lifetime OpEx cost into the purchase price of the product… but because you expect to add more ML-driven features as your apps evolve, which might drive increases usage, calculating an actual price here is hard. (Your best chance is probably to break each AI feature into its own “plugin” and cost + sell each plugin separately.)
Much easier to avoid trying to set a one-time price based on lifetime OpEx, by just passing on OpEx as OpEx (i.e. a subscription); and much friendlier to customers to avoid pricing in things customers don’t actually want, by only charging that subscription to people who actually want the features that require the backend cluster to work.
- derefr 1y agoThat being said, my line of argument here would be a bit more compelling if Canva were still charging for the app. The fact that the apps are now free, suggests that they expect the subscriptions to pay not just for the backend-cluster OpEx, but also for all the developers’ salaries and so forth. --- Honestly, I think Canva here are copying Adobe's playbook, but with a more honest approach than Adobe ever had; one reflecting a much more aware/cynical take on how the software market works in 2025. Adobe essentially charges a continuing fee just to continue to run the software they coded and shipped to you, on your own computer — regardless of whether you even care about any further software updates. (Sure, the subscription pays for other things, like Adobe Bridge cloud storage and so forth, but if you don't pay the subscription, you don't even get to just run the apps.) But this also means that people quite often crack Adobe's apps — because there's something there of value to run on your own computer, if you just strip off the DRM. Canva here are taking a much more pragmatic approach: • Anything that is given to the user to run is free, because ultimately, if you charged for it, people would just crack it. They aren't bothering with DRM or even trying to treat the app itself as a revenue stream. The juice just isn't worth the squeeze. Especially if you're not in a market position where you think you can win the big enterprise customers over from Adobe. • Anything that is run on your backend is charged for. Because users can't force your cloud services to do anything without a subscription. There's no "cracking" a cloud service. • But also, crucially — if a feature is a "fake cloud" feature, where it could be "pulled down from the cloud" back into the client by writing a compatible implementation of the server backend that does some simple thing, and patching the software to speak to that server (either over the Internet, or to a local-on-the-machine background service that ships with the patch) — then users will do that. So you can only really charge for features that can't be "pulled down" in this way. Like, for example, features relying on some kind of secret-sauce ML model that you never expose to the client. (And that last bit actually makes me less wary of their approach here: it suggests that they likely won't be charging for anything other than inherently "cloudy" features: these large-ML-model-driven features, cloud storage/collaboration features, etc. Which might mean that non-"cloudy" features get ignored... but likely not. For the same reason that Apple doesn't ignore macOS/iOS features in favor of iCloud features: new users won't be interested switching to the platform [and then potentially subscribing] if the base platform itself isn't competitive / doesn't serve their needs.)