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I agree with you, but the idea that someone might pay per use or per day for software is intriguing. I know some service apps (e.g. Fog Creek Co-Pilot) are buil
by gcheong 18y ago
I agree with you, but the idea that someone might pay per use or per day for software is intriguing. I know some service apps (e.g. Fog Creek Co-Pilot) are built on this model, I wonder if there are any others that have pay as you go pricing models though. I can't think of any reason why it couldn't be done more.
- patio11 18y agoI could offer it for my software fairly trivially. Here's why I don't: 1) Customers hate buying things multiple times, particularly in my niche. 2) Authorizing transactions frequently is friction. I hate friction. 3) I'd rather charge $30 than $5 because $30 communicates that the product is worth $30 and $5 communicates that the product is not worth your time. 4) If I charged $5 it would be unprofitable for me to advertise and Paypal would make much more than ~4% of my sales. 5) I strongly suspect that average lifetime revenue per user would be much lower if I charged per-use as opposed to per-lifetime. If a customer wants to use my software to do an activity tomorrow, and I told her "Its going to cost you money just for tomorrow", she might decide otherwise. If I tell her "Its going to cost you money, BUT you'll be able to do it for the rest of your life for free", then she (empirically) frequently decides to purchase for me.