No More Freeware

If you are a software developer, you are all too familiar with the term… dare I say it… freeware.  Yes, that’s right, the license type that has caused most of us a loss of revenue at one point or another.  Now, I’m not talking about GPL or the Open Source stuff associated with Linux (I don’t wish to start a war with that group)… I’m talking about “no cost” freeware products associated with Windows or Macintosh applications.

Some authors create freeware applications just for the fun of it, while others create them in order to up-sell to another product or to another version of their product.  In the early days of the Internet, software was created with very little thought to the future.  It was a brand new area, and most of us were just having fun with it.  Heck, who among us actually thought we could make any money doing this?  Very few of us believed that there was any significant money to be made this way.

But as we moved forward, we began to see many possibilities for generating revenue from our products.  And we then began to revise our business models accordingly.  However, what we did not see was the beginning of a trend that we started ourselves — users now spend far more time looking for things that are free, and far less time looking for things they have to pay for.

Recently, I ran across a poll being run on a top-rated Internet download site.  In 2 days time, over 10,000 (ten thousand) people voted on the question “How much are you willing to pay for shareware?”  Here are the poll results…

Poll: How much are you willing to pay for shareware?

Nothing:	77.4%
$10-$20:	11.4%
$20-$30:	06.2%
$30-$40:	02.1%
$40-$50:	01.6%
More than $50:	01.3%

The results are quite amazing and quite sad… but did we really expect them to be anything else?

Freeware applications have started to take control of the download sites. In researching the top 5 download sites, we found that an average of 14 of the top 20 products were freeware.  According to a sampling of the major categories on these top download sites, freeware applications made up about 65% of the overall content. That is an extremely large market share to compete against, and means that only 35% of the titles found on these sites are products that can be purchased by users… and generate revenues for their authors.

Recently a top download site sent out an email to software authors, explaining that products with low download counts will be deleted, unless their authors are participants in the extra-cost subscription features of the site.  However, if you are a freeware author who spends nothing, but your freeware products get high download counts (which is normal, since they’re free!), your titles are safe from being deleted.  In a time when software sales are declining globally, and advertising dollars are being stretched thinner and thinner, download sites need to start rejecting more freeware applications, or at least put a damper on accepting so many of them.  Developers who are paying for advertising are competing with those who don’t pay for anything. And while I can sympathize with the download sites as to why they keep the freeware titles online (i.e. to generate traffic), they need to realize that in the long run they are ultimately only doing themselves in because freeware applications do not purchase advertising.

Some download sites have actually found ways to cash in on freeware. Sites like NoNags, FreewareWeb and FreewareFiles have all found a nice market share that relies either on user subscriptions or advertising banners to support them. But there is a little hypocrisy:  they shout that they only allow freeware on their site, but they sell CDs and user subscriptions in order to make money from the freeware titles. Even they realize that they can’t make money off of the freeware products themselves, so they are forced to find alternate ways of earning a profit.

There is probably not an author out there who wouldn’t spend one dollar to earn two.  But in a freeware market, we just can’t always afford to do that. The more we provide freeware titles to the users, the more we are taking funds from ourselves.  My suggestion: lets all stop perpetuating the problem, work together, and limit the amount of freeware applications we release, thus somewhat forcing the download sites to work with us.  We would then all be able to afford advertising on these sites if we were actually competing for sales from one another instead of competing against freeware products.