Fairware: an interesting experiment in getting paid for Open Source

[mouser]

In a previous post i mentioned that the primary goals and motivations of the freeware/opensource developer are different from commercial software developers, which can help explain partly the search for an alternative model that could bring some financial support.

But I think the equally important (at least in my case) and less talked about factor, involves the SKILLS of those involved.

Speaking just for myself, I lack the skills and comfort level and drive that make people good entrepreneurs.

Part of my motivation for wanting to find an alternative donation-based model has to do with my discomfort and poor ability to play the role of salesman/marketer/etc., which goes hand in hand with my misgivings about the fundamentals of capitalism and my perception that greed is really one of the root evils of this world.  But leaving the philosophy aside -- for me it's probably more about wanting to find something I am comfortable with, good at, and feel good about doing.

I know i'm beating this horse to death -- I think we're all on the same page in being curious what new models might work and exploring the space of possible models, so let's concentrate on that!

[Nod5]

Very interesting discussion this!  

Regarding donations and laziness, are there any cases of software that accept donations via SMS payments? That is very quick and could bring donations from user groups that don't have access to credit cards. A big problem would be how to collect donations internationally. I've only seen national SMS donation services that you can sign up for (they take a cut out of the donations). Does anyone know if there is such a service that is global?

The contribution level is not great yet, and maybe it never will because I suspect that not that many people need to do what PdfMasher does.

-hsoft (September 11, 2011, 06:24 AM)

I think PdfMasher could find a very large userbase in the academic world. Reading of journal article pdf's on screen is very, very common. PdfMasher is the first application to offer a somewhat feasible way to convert articles for reading on Kindle, Nook and other small screen readers and tablets. For example, Calibre's built in coversion tools are not at all useful in comparison. PdfMasher still takes more manual and more complex steps than most academic users are able/willing to go through I suspect. But if it would have some smart automatic detections of headers and footnotes then I suspect a lot of users would come rushing. Anyway, I don't want to off-topic this thread into very PdfMasher specific topics so I'll stop here.

[mouser]

Nod5, love the new avatar 

there is a PdfMasher thread here: https://www.donation...ex.php?topic=27965.0

[40hz]

Actually, part of this is something I've been thinking about for a long time.

One thing small developers might consider is banding together to create a central purchasing point for their wares. In other words, an app store.

The big problem many people have with buying from an 'unknown' is their understandable reluctance to share their billing information with what could easily be an inadequately secured or honest billing point. That's why they'll often balk at making a $10 purchase from a small business, but think nothing of dropping an Amex card and making a $1000 purchase through Amazon.

Many times I'll see something I want and check to see if the business also makes it available through Amazon. Because if they do, I almost always will purchase  through Amazon rather than directly from the merchant. Why? Because I know Amazon. I worry less about the security on Amazon's shopping cart than I do about the security NiftySoft's unknown ISP provides. And I know I can drag Amazon into any dispute I may have with the merchant about shipping damages or goods not received.  At the very least, I know I can get my money back if there's ever a problem.

Now if developers could work out some arrangement (as an organization) with a reputable and well-known merchant account provider, I think one major barrier to receiving payment might be removed.

Even better would be if you could encourage customers to open an account (like you do with smartphone app stores) such that you don't need to re-key credit card or bank data with each transaction.

I can't speak for everyone, but not having to pull out a card has provided just enough convenience that I've bought many more apps (over 100 to date) for my, and my GF's, iPhone that I would have otherwise. True, most purchases were below $5 each so that had a lot to do with my willingness to take a chance. But not having to think about the actual act of buying something (since the app store makes it feel more like a free download) was also a major factor.

So, maybe it might be a good idea to focus on a trusted and reliable payment mechanism, and get that in place first.

After that, you're free to experiment with different pricing, licensing models, and incentive plans at will.

To recap:

1) Get yourselves organized into a trade group.
2) Get a trusted billing system in place to make it as easy as possible (bordering on no-brainer) for people to pay you.

That's another 2¢ from me.

(One more penny and you'll have a shiny new nickle.   )

As Mouser pointed out, he has neither the desire nor the mindset to become a full fledged entrepreneur. I'm sure he's not alone in that regard. Most people doing creative anything don't want to get involved with business issues. So maybe it's time for you to all get together and get somebody you can trust (because you own them) to take care of it for you...

Authors have agents. Rock stars have labels. Movie stars have guilds.

Why not indy software developers?  

[mouser]

40hz, this is something i've thought about too -- i think it has huge merit.

In some sense this is a principle that DonationCoder tries to use already.  That is -- part of the approach here is to offer lots of different software and hope that over the course of a year or two a user might see our name mentioned here and there and find a program or two that they find useful, and eventually see enough of interest to feel comfortable making a donation.  And after that they can send their donationcredits to different authors, etc.

I don't think the details are as important as the basic idea of figuring out a way to:
1. Reduce the risk people feel from making a donation/contribution
2. Reduce the work they have to go through to donate

The APP stores largely solve these problems -- though they aren't set up to let users pay whatever amount they want.  and some of them are set up to have so much crap that i think users wouldn't spend any time considering how much to donate, and so would donate a penny per app.

So the APP store idea is not a perfect match for donationware type software.. but there are lessons to learn from it..

[mouser]

You know sometimes i write these posts and talk about how hard it is to make the donationware concept work and sometimes write as if the approach simply does not work..

But it's totally irresponsible for me to write such things without saying how wonderful it is to be in this community of people who really do make it work.  Everyone who has participated in this forum has helped to make this site work -- and it does work.  It's not perfect and there is a lot we can and should do better at.  But a ton of people have given money and support and their time and energy to make this site work, and there's no place I'd rather be.  And i feel so lucky that all of you have made it such a wonderful and fun place to be.

[mahesh2k]

Authors have agents. Rock stars have labels. Movie stars have guilds.
Why not indy software developers?

It is very rare to have honest middle man that leads to win-win situation. Take example of leecher sites - they're ripping off freeware authors by hosting their files on servers with the excuse of promotion. Another example, appsumo which is borderline scam when it comes to app marketing. They're playing all scarcity tricks and popular internet marketing punches to sell software and other publisher or developer niche content. Some of the books and apps featured in appsumo mails are overly priced and don't deserve the label of discount or limited time (classic scarcity). Fair to users ? No. Then there is a marketplace called codecanyon and their niche based envato marketplaces where royalty percentage is 30-65%. Is it fair to software producer ? No. But if you need money for your hardwork then you have to compromise on some levels. It's really hard to price content by keeping balance of market demand and developers hard work. So app market or stock marketplaces are not always rewarding and consistent cashflow to developers.

That aside there are some problems with paying for software. Some countries are not allowed to use paypal or other popular shopping carts. So people have no option than skipping paypal or amazon buttons. It's hard to target international crowd with your donationware software.There is also issue of users who don't pay attention to developer website when they use free software. Take case of mousers URL snooper software which is helpful for ripping off online radio streams or sport streams. How many users come back to DC to get key or even donate ? There are many alternatives of URL snooper which are packaged with OpenCandy like stuff. Those who are desperate to download videos and audio stream don't care about OC ads and sales pitches. They just download and forget about it. It's hard to get this type of crowd to pay or get them to donate. FARR and Screenshot captor are two programs that are used by patient users so they're likely to convert with donation or returning visitor. I'm sure mouser gets more return hits in analytics on these two softwares than URL snooper.

So my point is - if you want to get paid for the freeware then make it easy for users to donate(point already covered by mouser). Offer them more options (in terms of payment processors) to donate. Restrict software distribution to your own server and get a dedicated forum to address bugs and other issues of software.

[Paul Keith]

Forgive my ignorance but don't package managers solve the middle man issue already?

Payments are troublesome but I think incentives are also often a problem. Most of the ideas thrown out are still nagware hoping to lump itself w/ a rare new -ware word, get blogged and get sudden <insert social media/insert blog> effect.

I haven't seen any site where a micro-donation form was linked to the changelogs where people can pay for features they want or hope that their money could sway a developer to tweak a feature they hate and the responsiveness of the developer be displayed in a Klout like display to increase the developer's credibility. Similarly haven't spotted a place where a commenting system differentiates between paying customers and non-paying customers making it clearer to the new visitor what the paying customer's culture is versus people just commenting.

Not that these are solutions, just that in terms of actual attempts, there haven't been many that are donationware-centric. Often times donationware takes some inspiration from freeware and sometimes shareware people go on their own way to tweak how to gain a profit.

[hsoft]

I haven't seen any site where a micro-donation form was linked to the changelogs where people can pay for features they want or hope that their money could sway a developer to tweak a feature they hate and the responsiveness of the developer be displayed in a Klout like display to increase the developer's credibility.

-Paul Keith (September 11, 2011, 11:11 PM)

Coincidentally, fairware is quite close to that. All contributions are linked to a timelog describing the work that has been done and, if applicable, a link to the ticket number in the bug tracker.

However, the user can't choose where the money is assigned because there's a backlog of work that is already done to pay. If users could choose, they'd all (well, those that bother ) chose the "sexy" work, but sometimes, the work that has to be done is simply "support", or "code cleanup", or "fix the broken build system" or some other type of work with a boring description.

One thing that fairware doesn't do is to allow, as you mentioned, to "bid" for future work. I personally doubt that it can work, at least in a fairware setting. If there's a backlog of hours to pay, I don't want users to bid for future work, I want them to pay my backlog. If there's no hours to pay, it means that the project is already successful and that I'm open to invest some more work already, so I don't need the bidding incentive. If past contributors simply indicate which features they'd want to see, without having to bid, that would be enough for me to make a decision as to what to do next.

[Paul Keith]

Yes, it's a tricky issue. I would say because donationware is well... donations...then it's much more applicable to the concept as long as people understand that they are not bidding so much as voting via their money to not only decide which features they want but hopefully a Klout system allows a better understanding on what paying minorities' demands are as well as open up a setting where people can redistribute their donations to the right credible developer and this system is what jumpstarts a sort of breeding donation-based economics to flourish and encourage a two way route between donators and developers. Something that would be a sharp contrast from the PMS-like donation roulette of most linked or nag-based donationware.

[mouser]

One thing that fairware doesn't do is to allow, as you mentioned, to "bid" for future work. I personally doubt that it can work, at least in a fairware setting.

I do think that one idea DonationCoder should very very seriously consider, is allowing people who donate to specify what future features they want to see in a program.  They wouldn't really be "bidding" on future work, but it would be a case where by donating they do get a tangible benefit of having the author put some additional resources into the features they care about.  With a high enough donation it might actually be a case of paying for a feature.  But for small donations it would be more of an informal "vote" for work on a certain feature.

I do think it's worth doing though because it's one of the few ways we can positively reward donators.

[cranioscopical]

how wonderful it is to be in this community of people who really do make it work.

-mouser (September 11, 2011, 03:46 PM)

And we don't say often enough what's probably in all of our minds, which is how much we appreciate what you have done, are doing, and will do.

You're the glue that nails this place together and so basic to our success as a community that you couldn't be stapler.

[Paul Keith]

This is written like a blog for eyeballs and the premise is simple (show your ideas to a big enough community) but I thought people reading this thread may also want to read about it:

http://www.twistimag...rt-your-own-economy/

[40hz]

Just thinking outside the lines for a moment...

I wonder if the notion of "pay what you want" or "please donate" is anywhere near as important to the buyers as it is to those who are making such offers. I ask, because from what I've seen, most people don't seem to care all that much.

I bring this up because in the early days of my company, we had the notion that the big problem with most systems support companies was that they tried to keep their customers "captive." And that they did this by not freely sharing their knowledge with their customers.

As a result, we emphasized "knowledge transfer" as a big part of our sales proposition. This, we argued, was the "right thing" to do from both a business and an ethical perspective.

Guess what?

Hardly anyone cared.

And those that did wanted no part of it. As one senior manager said: "We don't want you to explain to us what you guys do. Or teach our people how to do it. We just want you to keep our systems running - and fix them when they break. That's what we're paying you for."

Another told us "We're not an IT shop. The last thing we want is to have our people getting distracted from what they should be doing because they're getting involved with the stuff you should be doing." (BTW: I liked the way he said it enough I wrote it down.  )

Poof!

There went any illusions our potential clients were actively interested in changing the landscape of the systems support industry like we were.

Something to  think about...

[Paul Keith]

As always great stuff 40hz, I just think the analogy fails in this case as there are no buyers.

Buyers would at least see the product. With software nowadays, buyers don't see anything until it hits them on the face because it managed to get by their popular rss feeds or even Facebook and Twitter streams and other types of notifications which skewer towards the tech using crowd like the slashdot crowd who rarely see much value in being social...err... socialists.

Donationware (if it were a government) I feel would be closer to communism. Someone wants an idea that they feel anyone can need. They have two options:

1) Seek the place that produces such items and implore them. (Thanking them later via donation)

or

2) Make the product by themselves and letting the people come.

Either situation doesn't lend much to post-product creation donation demand. (Unless the developers goes into lengths marketing and retesting their audience but again that leaves only the major players' names unless they offer something "shiny".)

[mouser]

A main point of 40hz which i think is important is:

"most people don't seem to care all that much."

Part of the problem for DonationCoder and Fairware too i suspect, is that there are two groups of people we would like to request support from.

• The first group is the small core group of people who really do care, want to be involved, and provide the most important thing -- spiritual support, camaraderie, encouragement, and often generous financial support.
• The second group is many orders of magnitude larger -- and that's the group of people who use the software, and who are open to making a financial payment.  But for these people, most of them are like 40hz users -- they do not want to hear all about ethics and new financing models, etc.  In fact all this stuff just makes them want to leave and find someone they can make a normal purchase from.  The more you try to do something unusual the more these people will not want to waste the mental energy to deal with you.

Which brings me back to an idea i had a couple of years ago, which would be to make simple but distinct paths for users..

• So imagine a software page where it had a fixed price on it: $29.95 which you click to buy like normal software purchase.
• But also a button saying: Show me alternatives to paying this.
• If they click on that button they have choices like: I want to choose how much to donate; I cannot afford to pay anything now; I am not willing to pay anything but I would still like to use the software; etc.

This isn't really a major change to the functional way things are done.. it's more of an attempt to make a path that is easier and more familiar for "people who don't care".

[hsoft]

I agree about your care/don't care classification and I like this idea a lot, mouser. The devil's in the details, as always, but I think it's an idea worth thinking about more seriously.

[40hz]

+1

I think Mouser's idea is a clean and elegant way to both deal with the issue, and possibly change some people's way of thinking in the process.

It's also something that would be relatively simple to implement and experiment with.

At the very least it would go a long way towards moving the basis of this discussion to observable fact and behaviors - and away from the "I feel" nature of many of these conversations.

Why "believe" or "feel" or "suspect" when a little real-world testing could provide much better information? Like James Thurber said: "A pinch of probably is worth a pound of perhaps."

Note: when I used the phrase "don't care" I meant it in the sense of "not being actively concerned about" rather than  "not mattering ever or at all." Just thought I should clarify that point.
 

[wraith808]

Which brings me back to an idea i had a couple of years ago, which would be to make simple but distinct paths for users..

• So imagine a software page where it had a fixed price on it: $29.95 which you click to buy like normal software purchase.
• But also a button saying: Show me alternatives to paying this.
• If they click on that button they have choices like: I want to choose how much to donate; I cannot afford to pay anything now; I am not willing to pay anything but I would still like to use the software; etc.
  

-mouser (September 13, 2011, 09:46 AM)

That reminds me a lot of that payment form where you choose to take a deal instead of paying cash for the project (I can't remember what the name of it is now).  I wonder how different their conversion rates are because of that option... though this is a bit different, it still falls into that pattern of "I have to click something else to get the other options, so maybe I don't want to" trap.

I think that perhaps the humble indie bundle way might work better, i.e. show all of the options up front, but show the average donation, and one of the options is the average in addition to the set price.

[mouser]

So I think this could solve the issue of scaring away the no-nonsense-just-want-to-click-buy people, which would help a lot.

I think this still leaves the most difficult nut to crack -- which is how do you deal with the problem where it takes 10x as much effort (and perceived risk) to donate vs clicking the button that says "i can't/won't donate".

I talk about the approach of trying to fix this in my essay as "work equalization" -- making sure that it's not so much easier to not donate compared to donating.

Right now this principle is used to give people free license keys so they don't have to pay for our software or see any nags -- by giving out a license key after you sign up and register.  But this does create some inconvenience and ill-will.

It's not an ideal solution because it annoys people.  It would be nice to find an alternative approach that wasn't so annoying to people but still achieved the goal of having some way to make people not choose the path of least resistance of not donating.

[Paul Keith]

Which brings me back to an idea i had a couple of years ago, which would be to make simple but distinct paths for users..

• So imagine a software page where it had a fixed price on it: $29.95 which you click to buy like normal software purchase.
• But also a button saying: Show me alternatives to paying this.
• If they click on that button they have choices like: I want to choose how much to donate; I cannot afford to pay anything now; I am not willing to pay anything but I would still like to use the software; etc.
  

-mouser (September 13, 2011, 09:46 AM)

That reminds me a lot of that payment form where you choose to take a deal instead of paying cash for the project (I can't remember what the name of it is now).  I wonder how different their conversion rates are because of that option... though this is a bit different, it still falls into that pattern of "I have to click something else to get the other options, so maybe I don't want to" trap.

I think that perhaps the humble indie bundle way might work better, i.e. show all of the options up front, but show the average donation, and one of the options is the average in addition to the set price.

-wraith808 (September 13, 2011, 10:22 AM)

Have to agree with wraith here although I think trekking down the road of people who do not care is a dangerous idea.

After all, even in real life business, the ones with money are often those who don't care either which is what leads to things like sales pitches and fundraising.

Really things like credibility profiles are pretty much a shortcut to that. If someone can know exactly that a place or person has not only the most people donating to it but also has one of the most credible active developers there is of a specific niche, then inherently it builds a herd behaviour to those with money to not only start donating but donating more for that cause.

I think Donationcoder is also a proof of that. At least judging by the recent fundraising. People both want to keep Donationcoder.com running and they also know that as a forum, it's the site not just the community that keeps it active. The result would be more donations heading to the site. On the other hand, people who have no guarantee how much their donations might impact a smaller NANY project or an older less used AHK program would more likely be less urged to donate to that specific developer unless the program gains a radical overhaul or it's via a bundle and a regular donator just happened to catch up on the thread that introduced all these.

[mahesh2k]

It would be nice to find an alternative approach that wasn't so annoying to people but still achieved the goal of having some way to make people not choose the path of least resistance of not donating.

Humble Indie bundle is one good promotion theme that is running these days to raise the funds for developers. I don't know what will happen to this promotion method if it gets saturated.

[Paul Keith]

I think software is already over-saturated which is why many people are trying to have an android or iphone/ipad version on offer. Often times the ones who ask about an older program are those who jumped into a newer, flashier and emptier but more portable operating system.

[40hz]

On the other hand, people who have no guarantee how much their donations might impact a smaller NANY project or an older less used AHK program would more likely be less urged to donate to that specific developer unless the program gains a radical overhaul or it's via a bundle and a regular donator just happened to catch up on the thread that introduced all these.

-Paul Keith (September 13, 2011, 11:33 AM)

Again, what is the real goal here?

Are you looking to:

Reward/punish coders for certain behaviors?
Locate and obtain interesting software?
Get your software out where it can be found?
Raise public awareness about coders and coding?
Make some money?
Not lose money?
Just break even?
Get big?
Stay small?
Act as a springboard for a commercial software venture?
Become an adjunct of the OS or FOSS movement?
Mainly hang out and rap with like-minded people?
Provide a trusted buying point for independent coder products?

I ask because a lot of this seems to be going in many of different directions. So...how about starting the ball rolling by coming up with a position statement or manifesto that spells out the big goal or goals with the ultimate aim of coming up with a concrete (as in doable) project with a workable roadmap for how to get there?

Coders are logical, organized people. Or so I'm told. Why not treat this 'problem' the same way you would a major coding project and see where that leads?

Just thinking out loud here...

Addendum: I really like the humble indie bundle. Ive bought in on more than one of those. But I think it sends the wrong message sometimes. Too much emphasis on "humble" and "indie" and "bargain" and nowhere near enough on the exceptional quality, variety, and value to be found there.

Gotta stop with the "Aw shucks!" routine and start claiming your rightful place up there with the so-called big players. Because if you're not doing something good enough to stand on it's own merits, why bother at all?

Seriously guys! You have got to stop putting yourselves down so much. You need to build a reputation that you're bright, responsive, and innovative. And that your code is as good as anything else that's out there. And 90% of that reputation can be had just by saying it's so.

Many times the only differences between a professional and an amateur is that the professional thinks of him or herself as a professional, acts accordingly - and has a business card.








 

[Paul Keith]

Since I'm not a coder, my real goal as a suggestor is simply to maximize the draw of the donation aspect via sharing an idea w/ the intent of increasing these three concepts:

-Visibility (What if I want to randomly donate to a random awesome application at this moment but would be bored later on?)

-Sentimentality (What if one day I won a huge chunk of money and want to help a developer maximize their application?)

-Packaging donationware to the image of a singular identity (What if I, a donator, am seeing several awesome app and can only donate to one of them? Which area can I best help in? Which area is the most urgent? Which area seems like it won't develop as many clones?)