Recently, though, Setapp had a breakthrough. Setapp's intended customer still seems to start with the Mac developer, the same folks MacPaw has been working with for years. "300 apps could cover every need a Mac user might have while using the computer," he said. That's one way he doesn't want to be like Netflix: He'd rather have a smaller set of great, vetted apps than try to offer the entire App Store for a single monthly fee. Ultimately, Kosovan said he wants Setapp to have 300 apps. Apps that are more expensive outside of Setapp - developers are free to sell their apps elsewhere, including the App Store - also get a slightly higher portion of the Setapp money. If a user gets both Taskpaper and Bartender through Setapp, but spends eight hours a day in one and only touches the other once every 30 days, both get paid the same. It now tracks every time an app gets opened and pays developers a chunk of every user's subscription fee who opened their app that month. Figuring out how to compensate developers was tricker, but after testing some options, MacPaw landed on one it liked. "When there are too many subscriptions," Kosovan said, "customers really hate it." And they won't pay for them all.įor Setapp, solving the problem for customers was easy: One subscription, all the apps. (Setapp's commission is 10%.) More apps over the years have set up their own subscription services, but that solved one problem and created another. Consistent, predictable revenue is much better than fighting for every individual sale, and especially in uncertain economic times, it also helps to not pay Apple a 30% tax. The likes of Adobe and Microsoft may have the marketing and infrastructure to handle their own subscriptions, but most developers don't. Most app developers are small businesses, and Setapp is meant exactly for them. Revenue-per-subscriber growth was slowing as upsells and expansions went away, but the general rule of subscribers is that most of them don't leave.įor developers, the money matters, but the stability even moreso. Zuora's study of the sector found that even during the pandemic, subscription-based companies continued to grow while the overall economy shrank, because consumers like the one-price-for-everything proposition as well. Thanks to COVID-19 and the economic chaos it has brought, the appeal of the so-called subscription economy has become even more obvious. The obvious answer, of course, was subscriptions. "We had to keep a lot of functionality for the next major release, because we had to have an argument for why customers would pay for the upgrade." Throw in in-app purchases and the fact that customers feel like they're being nickeled and dimed all the time, and you have a clear problem. "Perpetual licenses were very popular, but you have to purchase every two or three years when the new upgrade has arrived," he said. Even in 2015, he was hearing from developers that they didn't like the App Store way. Setapp, Kosovan said, was all about solving a business-model problem. Developers can sell their apps in other stores as well, but Setapp's rules hold that all features, all in-app purchases, everything has to be unlocked for Setapp users. Setapp users get to-do list apps and wonky Mac utilities, like CodeRunner and Disk Drill, power-user work tools and at least one app for looking at Instagram photos. Kosovan and MacPaw have spent the last several years building Setapp, a service Kosovan describes as a "Netflix for apps." Countless companies want to be "Netflix for X," but Setapp actually fits the bill: Users pay $10 a month for unlimited access to a growing list of apps - currently just shy of 200 - that are fully available to all subscribers.
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