Popular Science bitches and moans about how the rumored Apple Tablet could ruin computing. [h/t Instapundit]
The Apple Tablet is rumored to be a cross between a laptop and an iPhone. The iPhone isn’t really a cell phone, rather, it is a handheld computer employing a touch interface with a cell phone built-in. It uses a slimmed down version of Apple’s MacOS X operating system that Apple uses on all its computers. This makes it easy to make an actual laptop-like device that uses the iPhone’s operating system complete with the special cell-phone associated attributes of the handheld.
In PopSci’s thinking, this is a problem because the iPhone’s default setup only allows people to use software written by independent developers but approved by Apple installed exclusively by being downloaded from Apple’s App Store. According to PopSci, this is bad because if this model spreads to all computers, people wouldn’t have the same level of flexibility to run any software they please on the new type of computer as they do on current ones.
PopSci needs to rethink that because without a new business model to pay for the creation and distribution of software, there won’t be any software for people to run. You can’t make money anymore writing and selling software using the current business models. PopSci isn’t saving freedom for end users, they’re killing it. Apple is saving the freedom of end users by making it possible for software developers who aren’t giant corporations to make a living at writing software.
The iPhone and its App store recently convinced me to return to writing software directly for end users and I am far from alone in doing so. The iPhone app store has ignited a renaissance in software development and PopSci shouldn’t be trying to abort that. We don’t need a software Bonfire of the Vanities.
(Just for clarification, when I say software in this context, I’m talking about programs that are installed and run on the end user’s hardware. Web based software, i.e., things you use from a web browser, is an entirely different business model. Things aren’t so hot there for small developers either.)
When we talk about who writes software and for whom we’re not talking about technology, we’re talking about business models. Technology is all great and good but business models provide the organization and the allocation of resources that lets end users route their money to the people who create that technology. It doesn’t matter what kind of whizbang idea you’ve got, no functioning business model means no technology in the hands of end users. It’s just that simple.
PopSci does not wish to face the ugly truth that the business model for software development is fundamentally broken. Only big companies can make a profit doing it anymore. If you don’t like what they make, you do without. It wasn’t always like that.
From roughly 1975-1995 a lot of individuals and small companies made a lot of money writing a lot of software. They could make money because they could reasonably expect to be paid for the vast majority of installs of their software. Software could only be easily moved between computers on a physical medium and bypassing serial number protections was relatively difficult. If an individual wrote a useful little program, they could sell it for reasonable price and expect that 80% of the people who used the software actually paid for it. A small program that took a month to write, sold for $9.95 and had 10,000 installs would bring in something like $80,000. That left a tidy profit of around $8,000-$16,000 dollars. Those kinds of numbers made it possible for small developers to survive and create a blizzard of innovative software to fill almost every niche.
Post-1995, things changed. The arrival of large capacity physical storage, networks and the Internet made it easy to move software from computer to computer. Serial number protection is cracked within hours or days of a software title’s release. Today, a small software developer has to assume that 80% of the people who use their software won’t pay for it. A program that takes a month to write, sells for $9.95 and has 10,000 installs will only bring in $20,000. That leaves a profit of $2,000-$4,000 dollars. That’s okay if you’re a high school student but you can’t earn a living with those numbers. Small developers have moved into other areas. They don’t write programs for individual end users anymore.
Today, the computer software industry has split towards two extremes. We have the really big players like Microsoft, Apple, Adobe et al, who either attach their software to hardware or who have the money and legal muscle to force institutions to pay for their software. In the middle, you have a very tiny population of small companies that mostly make their living writing custom software for specific clients. At the other end, you have open-source freeware which is economically parasitic on some other activity (e.g., universities, tech support, turn-key installs, etc.). Such software only exists if the programmers have some means of earning a living other than being paid for actually programming. Businesses based on free, open-source software make their money helping people to use the software, not by writing the software itself. Such businesses aren’t computer software developers, they only tweak software written by others as a sideline to their main business.
All of this means that an individual or small company cannot make a living writing software. Consumers are left with a choice much like the one we have with cars. Today, you can buy a car from a giant, multinational corporation or you can have Billy Bob cobble one together for you out of parts he found in the junk yard. You can’t buy a small car from a small manufacture like you could 70 years ago. Likewise, you can’t really buy a small, useful, inexpensive, polished and reliable program from a small developer because those developers cannot afford to write that kind of software. This is the “freedom” that PopSci wants to preserve.
Enter the iPhone and Apple’s App store. The App store makes it simple for small developers to write, distribute, sell and — drumroll please — get paid for, computer software. The App Store has created a boom time for small, creative software developers and provided iPhone users with a staggering degree of software choices. At the time of this writing, there are an estimated 65,000 iPhone apps.
The overwhelming majority of those apps are written by small developers. Thousands of small developers, the kind who historically have created new, ground-breaking software, are flocking to the iPhone. The business model for the iPhone and the App store has created an explosion of creativity and business diversity in computer software, not seen since the mid-’80s and not seen in computers in general since the dot-com days a decade ago.
End users win as well. Apple screens apps so they can’t be malicious or overtly defective. Since developers get paid for every install, they can charge far less for each app. Most apps sell for $0.99 and even the most sophisticated and specialized sell for under $10.00.
If Apple moves this model into the full-fledged computer world, we could see a similar renaissance in desktop software. Instead of plunking down several hundred dollars for Microsoft Word, end users could buy a dozen or so small applications for a few dollars each that would combine together to handle their word processing. For example, you could have a basic framework application and then buy several $0.99 cent plugin modules to make the program do just what you wanted it to. Small, niche markets could get software written for them. You could actually pay a couple of dollars for a small, special-purpose program and get it when you wanted it, instead of having to wait for a bored computer science major to bang out a crude version over the summer break.
However, what if, like PopSci, you hate the idea of not having complete freedom over your software choices? What if you want to pick and choose whether you pay programmers for their work or not? What if you don’t want vetted software. What if you want to run software written by the Russian mob? Well, you still can. You can do so on the iPhone today by jailbreaking it and turning it into a completely uncontrolled, unmonitored platform. Simply don’t use AT&T and Apple’s services and you can steal all the software and take all the risk you want. Oh, wait, what if like PopSci and Google, you want AT&T and Apple to provide all the benefits of the iPhone and App store today without any of the tradeoffs? Well, too bleeping bad, you can’t. Everything has tradeoffs. Grow up and stop whining.
Like the old saying goes, you get what you pay for and free is often worth every penny. There wouldn’t be 65,000 and counting apps for the iPhone if iPhone developers couldn’t get paid for writing them.. Instead, there would be about 1,000 apps and 800 of those would be rattletrap kludges whipped together for some programmer’s amusement (400 of which would be programs that only programmers would use), and the rest would be toss-offs funded by some big corporation to tie in to or advertise some other product of theirs that actually made money. End users couldn’t get the apps they actually wanted, because the business model wouldn’t exist that could funnel their money to the people who could write those apps.
The iPhone as a technology is ground breaking. The App Store as a business model represents (and I usually hate this phrase) a paradigm shift in software business models. To date, we’ve sold software like expensive books in a bookstore. We’ve sold programs like they were physical items, but software is ethereal and it has to be sold in different way with different tradeoffs. The App store does this. It sells software with boundaries of software, not software with boundaries of paper.
Like all good business models it has the potential to reward the creative and provide functionality to users. Like all strong systems of property rights, it will protect the interests of the small and powerless against the interests of the big and powerful. Like all free-market products, no one has to use it if they don’t like the tradeoffs inherent in doing so.
If PopSci had the awareness of technological history that a technology publication should have, they wouldn’t be cheering on the attempts by the giant, multinational corporation Google to hire the government to force AT&T and Apple to let Google parasitize the former two’s system. Instead, they should be rooting for the system that give the little guy a chance.
The modern computer industry started in garages. The future of computing could be born there as well if PopSci and others of like mind weren’t so damn nearsighted. I’m heading out there now.