On Fremium Apps:

And that’s exactly what we’ve seen in the App Store. People have no problem paying 99¢ for a gimmick, and don’t mind risking 99¢ on an app whose value is unproven, but trying to make the boxed software model work at 99¢ a pop is a fool’s errand. Sure, gimmicks and mass market apps like Camera+ seem to prove the opposite, but they are the outliers. The vast majority of apps are financial flops even though they deliver tremendous value to their niche.

(Via Shawn Blanc)

I agree with 99% of David’s article, but there’s just one sticking point for me.

While I think subscription and in-app purchase are absolutely the only way to sustainability in the future for most apps, I see no reason why that means apps have to go freemium. Why can’t we charge a fair price for our apps up front, and then charge again for additional in-app features or subscriptions to services?  Why are we so averse to being good salesmen?

Right now, productivity and other non-game apps are the last part of the App Store where users expect to pay more than nothing. Why condition users to expect free there if you don’t have to?

To me, the barrier for users is not a matter of money, but one of trust. People have shown time and again that they will pay for value on the App Store. Final Draft Writer is proving this week that a $30 app can rise as high as the third grossing iPad app in just a few hours. Why are they getting away with charging so much? Because they’re the most trusted brand in Hollywood. They are the defacto standard for the kind of app they make.

How do you get to that level of trust with users? Well, dropping your price to free to let more people try out the app without risk is one way to go about that, I guess. But for me, the better way would be to build a reputation for being worth your asking price. That takes a whole lot of time, patience, and pleasing your user base. Your sales grow at a much slower pace, and it takes a long while before you are making decent return on your app. But in the end, you get to be known as a luxury brand, rather than the bargain basement company. I think long term, that’s where I’d rather be.

I’m not sure giving away an app for free and then figuring out how to get money for it later is a good way to build people’s trust. Look at Twitter as a shining example of what happens when you aren’t up front about the value proposition with your users.

BMW designer: Apple affected the popular color of cars:

Usually only found in luxury cars because of its high maintenance, white is now the most popular exterior car color in America. It recently unseated silver, which has held that title for over a decade.

(Via TUAW – The Unofficial Apple Weblog)

Never underestimate the power of Jony Ive. The man who turned computers from beige and black to fruity colors, then when the entire world copied that, turned around and made everything white.

Now that white is so popular, I wonder what color Apple will make cool next?

Baristas everywhere. Do me a favor and stop making super strong lattes with large double shots of espresso by default. That might be trendy nowadays, and your hipster audience might like it. But you’re doing it wrong.

The whole concept of a double latte is flawed. Latte was invented for people who can’t handle strong espresso. It’s a watered down (or more accurately a milk-diluted) pansy-assed American form of the cappuccino, which is a stronger drink with more foam. If I wanted my latte strong, I’d order a cappuccino. Or I’d just get a shot of espresso.

Don’t get me wrong; I’m not calling latte drinkers wimps. I actually enjoy making myself a nice latte every weekend as a little break from my daily jet black coffee. And that’s the point; it’s a break from the strength of the heavy coffee drink. It’s a nice refreshing way to enjoy a bit of caffeine without all the harshness you need during the weekday mornings.

Which is why it drives me nuts when I’m out somewhere and I order a latte, only to get a punch in the face from this double-espresso monstrosity. Its like buying a minivan then putting a supercharger in it. Just own the fact that you’ve given up on excitement and drive the minivan with pride. (Not in the passing lane, though, please.)

And while we’re on the subject, it’s whole milk in the latte. I know two percent and soy milk foam effortlessly; that’s beside the point. Two percent tastes like water. If I wanted water, I would have ordered an Americano. Soy isn’t even milk. It’s fine for people who are allergic or lactose intolerant, I guess, but otherwise, keep it away from the rest of us.

What I’m saying is that it’s fine to have those as options, but I shouldn’t have to ask for whole milk in order to get it. That would be like ordering a hamburger and having to tell them “Beef, please, not turkey or tofu.”

Excess foam is for cappuccinos, anyway. Lattes are supposed to just be steamed milk, and they’re supposed to taste good. And since this is an American drink we’re talking about, they’re also supposed to be fattening.

If you like your overly caffeinated, non-milk, wannabe cappuccino lattes, that’s fine. Let’s just give that drink another name, so I can order a latte without giving special instructions on how to do it properly.

Death of the Free Web | Cap Watkins: “I’ve actually been noticing this transition in SV for the past year or so. More and more startups are focusing on revenue right out of the gate. The old way of trying to build gigantic user-bases and then sell their eyeballs to advertisers is falling by the wayside. There are certainly still exceptions, but right now they are just that – exceptions. Seeing a startup go after paying customers used to be like catching a glimpse of a unicorn. Now, it’s the status quo. But why?”

(Via. capwatkins.com)

Great piece here by Cap Watkins. Be sure to read it in full at the above link.

Sooo glad to see this trend. This whole Silicon Valley disease of fooling people into thinking everything in life should be free has been driving me nuts for decades.

But the free web won’t die, unfortunately. It’s like a zombie–keeps rising up from time to time no matter how much you try and kill it. I have no doubt that this ad-supported nonsense will come back around. It cycles. It’s just too tempting for the handfuls of people who stand to get rich from the advertising model, and they’re very good bullshit artists. But the current cycle is winding down on ads, at least, and that makes me happy, at least for another year or two.

As I keep joking, I’m looking forward to the traffic and rent prices coming back down to reasonable levels here in the Bay Area soon.

We’re discovering that you can’t create that sort of passion with free.

His example of Uber cab is an excellent one. Services that set out to solve a real-world problem don’t need to be free. People throw money at trying to solve problems all the time. And they’re happy to do so. And they become very loyal to services they pay for, in a way that they’ll never be loyal to Facebook or Twitter. Uber, Zipcar, Kickstarter, Square. These are the startups of today, and hopefully tomorrow.

Why Wall Street unfriended Facebook – The Globe and Mail: “Welcome to the tech industry’s summer of sober second-thought. For an unusually large number of Web and social media darlings, these past few months have been a harsh lesson in how quickly the stock market can turn nasty.”

(Via. The Globe and Mail)

Repeat after me: Ads cannot fund giant companies indefinitely. Eventually, the advertisers always figure out that their ad buys are essentially worthless, and they all pull out, rendering the service unsustainable. They move on to the next big unsustainable idea.

You can tell this is about to happen whenever web sites start pushing more and more intrusive ads into your face. It’s blatant desperation.

We’ve seen this before; we’ll probably see it many more times in the coming decades.

The only surprise here is that someone as smart as Zuckerberg hasn’t found more value in all that other data he has. If ads are the most creative thing he can come up with for funding Facebook, the company isn’t going to have a bright future. He should be playing way past this by now.

As suggested by this article, ads don’t even make much sense within the context of Facebook. Zuckerberg designed the entire experience around staying within the walls of Facebook 24/7. Ads, by default, are effective only if they let you leave the site you’re on and go to the advertiser’s page.

And Twitter, just getting into the ad game now? You’re about three years too late.

Wall Street is going to be more harsh this time around, because so many investors got seriously burned by tech during the dot com craze. There’s a lot of bad blood still flowing over that fiasco. Which is why tech companies that actually have a solid future like Apple trade way below what they should.

A Facebook stumble, followed by a hard Twitter fall, may depress the entire tech sector for several years, even if we don’t have a large-scale crash like before.