Report: Most Subscription-Based Apps Do Not Make Money

[Saturnine]

I don’t bother with subscription based apps personally, with very few exceptions.

I can imagine that many people who do subscribe to apps may only do so for a limited period - while they have a need for that particular app. But eventually something better will come along, or the task they’re working on will be completed and so will the necessity to continue a subscription.

Another issue is that companies seem to have an impression that their app is cheap because it costs less than “A cup of coffee per month.” But with so many apps and services requiring a subscription these days… I’d never get to drink a coffee! Any apps requiring a subscription are competing for the relatively small amount of money I am willing to spend on apps every month.

With that said, for a useful app I can imagine using time and again, I am willing to pay quite a lot for a lifetime subscription.

And to call out one app in particular… Flighty. I’d quite like to use that app but, like many people, I only take a handful of flights each year. There’s no way I’m paying £4 per WEEK or £50 per year. Much less their lifetime purchase cost of £250! I feel the developers of that app are very much out-of-touch with how much people are willing to pay for what is, a good app, but very much a non-essential luxury.

 

[Apleeseed84]

Why developers choose to use subscriptions in the first place when they can certainly choose to use one-time payment option! Most of them didn't make the app quality good enough to deserve subscription fees.

I only pay subs on Storage based services, however the entire industry is subscription based at this rate 🤣🤣

They thought they could make money off of us not no more

 

[ItsASpider]

Don't worry, Apple's profit on these subscriptions on the other hand is 100% which enough people here will happily defend.

 

[crsh1976]

I've worked with companies that make apps for over 10 years, there's good and bad but businesses that still aim to strive thanks to sub revenues are just not listening to the obvious truth: your app, however valuable you think its features are, isn't worth paying for.

The business logic is prioritizing ways to recoup cost of development and maintenance for obvious reasons, but it doesn't work to rely on subs for everything - not all app services/features are Netflix-grade, so you better find other ways to make money off your stuff.

 

[ArtOfWarfare]

They are certainly not seeing money. Why should I pay a subscription for an app like "Splitwise" which was developed once and hasn't had any changes (as far as I can tell) since.

I definitely understand this point, but on the flip side, how should developers handle when Apple breaks stuff in an iOS update (which Apple does on a very regular basis?)

I sold you my app a few months ago, am I obligated to fix it when Apple breaks it? I think we agree yes. How about after a year? Two years? Five or ten years? Sales of my app dried up two years ago - am I still obligated to go back and fix it for those people, even though it won't bring in a single cent?

Further, if I do fix it, nobody will appreciate it. I put the effort into simply making it work the same as before, and people complain that "as far as I can tell, nothing has changed".

That's some of the motivation behind the shift to charging a subscription fee - it covers the cost of having to go in and fix it every few months when Apple changes something.

I do have a proposal for fixing it though...

Make Apple pay for it. There should be a way for devs to notify Apple that the changes they've made to iOS break their app, and give Apple the option to either:

1. Maintain backwards compatibility.
2. Refund devs some of the 30% cut that Apple takes so that devs can afford to go in and fix what Apple broke.

This would be a massive win-win-win for everyone.

1. Apple finally justifies their cut. It's to maintain stability for all apps. iOS could actually get a positive reputation instead of something people grudgingly use.
2. Customers have more stable apps that they only pay once for.
3. Devs don't have to make as many changes just to maintain stability and/or they get paid for the generally thankless task.

 

[tucupeis]

subscription model only makes sense when there are obvious running costs to support the app features.

 

[spazzcat]

I'm shocked /s

 

[Yujenisis]

One of the reasons I don't use Fantastical is I refuse to pay for a Calender subscription. Why pay a subscription when Apple's works perfectly fine?

Interesting. I divorced myself from a Fantastical subscription and fell back to my grandfathered version which I purchased outright. They keep adding more and more buttons I can’t use because I don’t subscribe which clutter the interface and make me spend time actively searching for a replacement as the polish I so loved is bloating. Calendar 366 comes close, but lacks most of the features, ease of use, and polish.

The problem as I see it, isn’t that developers don’t deserve to charge a subscription (if not API and server costs than support represents an ongoing drain), it’s that a subscription needs to offer ongoing improvements that are compelling to users to keep retention.

Fantastical gatekeeps all these team and collaborative features that I’d wager 90% of its former users do not use and bundles it with useful things like weather that are great but also half-baked like an afterthought when having a great weather/calendar app is actually unique and compelling.

Now if Fantastical made an email client half as amazing as their calendar and offered a whole productivity suite for the huge price their presently asking (~$60/yr) is a much more compelling value. Throw in a best-of-breed weather app that also integrates with the calendar? I’m immediately sold.

Fantastical for my money is still the best iOS calendar app. It’s just simply too costly for what it offers for the majority of users and the ongoing improvements for those who continue to subscribe are underwhelming IMO.

 

[0339327]

This is information that is not relevant to me, though it is certainly relevant to app developers.

Developers will follow the market, and if the market dictates that subscription fees don’t work, they will change the pay scale to reflect that.

If app fees in general don’t work, and subscription models don’t work, meaning people don’t want to pay for apps, that will be major problem for the industry as a whole.

 

[aevan]

Why developers choose to use subscriptions in the first place when they can certainly choose to use one-time payment option! Most of them didn't make the app quality good enough to deserve subscription fees.

Because one-time payment earns even less money.

The sad truth is - people don't want to pay money for apps and the only really sustainable model is free + ads. Which sucks.

 

[gustaw94]

That's why I'm no longer using 1password. After they introduce subspriction, I switch to keychain. Miss old they, when I OWNed software that I paid one-time.

 

[Bustycat]

The average revenue would skyrocket if gacha games (which often include subscriptions) are included!

 

[spazzcat]

If you are going to charge a monthly fee I expect new features every month/every other month.

That's why I'm no longer using 1password. After they introduce subspriction, I switch to keychain. Miss old they, when I OWNed software that I paid one-time.

I did the same.

 

[canadianreader]

Procreate is the best selling iPad app it has no subscription nor in-app purchases.

 

[aevan]

Interesting. I divorced myself from a Fantastical subscription and fell back to my grandfathered version which I purchased outright. They keep adding more and more buttons I can’t use because I don’t subscribe which clutter the interface and make me spend time actively searching for a replacement as the polish I so loved is bloating. Calendar 366 comes close, but lacks most of the features, ease of use, and polish.

Fantastical is one of my most used apps, and I think they definitely deserve the asking price. If you don't want to pay, that's fine - but that only means that if most people think like you, we'll end up with apps that lack features, ease of use and polish.

Fantastical is one of the best made, most polished apps on the App Store that you literally use on a daily basis for work and life. If that doesn't justify $60 yearly - nothing does. Which just means that we should accept a future with mediocre, ad-supported apps. Which is a future that seems to be coming. A shame.

 

[Bustycat]

That's why I'm no longer using 1password. After they introduce subspriction, I switch to keychain. Miss old they, when I OWNed software that I paid one-time.

I use Bitwarden.

 

[LavaLevel]

I still sell my app game outright for Premium price, never offered it free/with ads/ in app purchases/ or subscriptions. No shenanigans. Just one price, it's yours. I rewrote it for the great 32-64bit purge. I've kept it updated throughout these 11 years. I've never had a month were I didn't earn something. I am weeks away from releasing the sequel. I have a small fan base that I love and that encourages me.


Premium App is the way to go.

 

[spazzcat]

Don't worry, Apple's profit on these subscriptions on the other hand is 100% which enough people here will happily defend.

Yes, I support Apple making money off their platform, what is the point? Apple also reinvests a large part of this into the platform.

 

[laptech]

So the report from RevenueCat proves what people have been saying ever since apps went to a monthly subscription, users do not want subscription based apps.

 

[aevan]

Procreate is the best selling iPad app it has no subscription nor in-app purchases.

Because they are still growing sufficiently. When they stall - and they will, sooner or later - they will either try charging a new version (and then you'll get some people who just won't be willing to pay the upgrade "because the old version works") or they will move to subscription. Either that or ad revenue, which would suck.

Savage is currently earning money from new users. Sooner or later that will dry out and their only option will be to get more money from existing users. Paid upgrades (which is not a reliable source of income) or subscription.

 

[Apple_Robert]

Regardless of the results listed in the article, the subscription model will continue to grow, unfortunately.

I make one time payments for apps (outside of Apple Music and iCloud 50GB plan).

 

[aevan]

So the report from RevenueCat proves what people have been saying ever since apps went to a monthly subscription, users do not want subscription based apps.

Users do not want to pay for apps, period. Users think that $4.99 should give them a lifetime of support and updates. And considering iOS and iPadOS change (and break things) every year, considering new devices with new features come every year, and considering you have to pay your employees - what users want doesn't really matter, because it's not sustainable.

So, it will be either subscriptions, mandatory (or heavily incentivized) paid upgrades, ads or end of life.

 

[CarAnalogy]

Why developers choose to use subscriptions in the first place when they can certainly choose to use one-time payment option! Most of them didn't make the app quality good enough to deserve subscription fees.

I like the model that has become popular with my favorite apps. You have a choice between low price every month (if you think you'll only use it infrequently or just a few times), saving a few bucks off that for a year (if you're still not sure the app will be around or whatever), but most importantly, a reasonable lifetime price equivalent to at least two years of subscription.

I think that's the best reflection of reality for everyone, given the options available. Sometimes people genuinely don't know if an app really is worth its full up-front price, and a week trial may not be long enough to find out. If the price is low enough, up front pricing works, but when you start asking more than fifty dollars or so, people want some assurances.

And many developers have started simply releasing new apps so they can charge again. Bundles on the app store approximate upgrade pricing. So sometimes you're taking a gamble on a "lifetime" purchase, but this is the same way it has always been with desktop software anyway.

If the price/value ratio is there, this is all very reasonable. Developers need to be properly compensated for the expense and effort of developing quality apps. It may very well work out better for both parties to have a subscription payment system.

 

[vagos]

You’re a dev?

I can name apps off the top of my head that require servers/cloud that isn’t my phone.

YouTube (ads supported, but you can have a subscription)

Fastmail (for emails)

1Password (yes, bad example, but people are using their servers to connect other devices)

I can list more also.

I can see some apps needed or, but I can see some not at all.

I obviously refer to apps that don't require a server or sell content (like YT).

 

[Kastellen]

It's not hard to see why

(A) one time payment of $99.99 and buyer can use the app for as long as they want or when it's no longer supported by the OS, or

(B) $9.99/mo to use the app

Obviously, (A) is better for the consumer. But (B) is better for the developer because if you want to use an app for a full year, you'd have paid $119.88

Well, the developer could also charge $119.99 for the app.

No, the reason subscription is better for the developer is that all the money doesn't come in at once when you release a new version of an app. Dependable ongoing revenue is much, much better for any business. If you're a developer and release a new version of your app you get a big influx of cash all at once, which slows to a trickle until your next version. But meanwhile you have regular monthly expenses of salary, utilities, rent, insurance, etc., and no dependable revenue stream. That's true for any app, not just those that have server-side storage or usage.

Running a business is never about profit, it's about cash flow.

That said, as a consumer, I am very circumspect about which apps I use that have subscriptions. For the few I use, they all have regular updates and dependable support. If those fall off, I switch off to something else. But if I like an app or developer, I have no problem paying a subscription.