Under the Radar

Under the Radar 1: Adapting to the Market


  we should to be intro didn't work that

  it's fine it's alright all right so this

  is episode 1 of under the radar I'm

  Marco Arment and I'm David Smith you may

  know our other podcasts david has been

  doing developing perspective for many

  years I did build and analyze first now

  I do the accidental tech podcast and

  top-4 and this is going to be a show

  about development basically it's kind of

  like the the the sequel the combination

  of build and analyze with developing

  perspective and in the spirit of

  developing respective never being longer

  than 15 minutes David how long is this

  true gonna be never longer than 30

  minutes so let's get started let's get

  started I think the place to start seems

  right now we're recording just after the

  Apple TV app store launched and it went

  online I think on last Friday and it's

  you know it's had it had a the usual

  fanfare and the things that go on with

  that but neither one of us launched

  anything on day one and then for myself

  it's the first Apple product I've ever

  not been in the store on day one for

  which is interesting

  yeah I'm the same way I I think I mean I

  was there for the watch and the Apple TV

  and I even I even got one of the early

  access developer units because I thought

  I might use it and it just literally sat

  on my desk and I was I was so busy doing

  other things because I was doing I was

  working on overcast and trying to get

  the 2.0 update out the door and that

  kind of precluded this because if I'm

  gonna make an Apple TV app it has to be

  all about streaming because local

  storage with the Apple TV is so limited

  and I didn't have the streaming engine

  done yet so I worked on the iPhone app

  first and I've been I've been doing bug

  fixes on that since and I just I have

  literally not even opened like an Xcode

  project with the TV I've no I haven't

  even seen the TV simulator I have not

  written a single line of TV code yet

  have you yeah I I got a I got a

  developer kit as well and I wrote a

  version of Padre angler my podcast

  client for the Apple TV and it works and

  it plays I didn't

  spend the time and energy to get it

  ready for day one though but it's like

  it's an interesting developer platform

  because it is essentially iOS just - a

  bunch of stuff like there's a couple of

  new things but essentially it's just i

  OS UI kids with a different input

  mechanism rather than obviously being

  touch based it's remote control based

  but I used it and is like it's it's fine

  and easy the thing that ultimately I

  think slowed me down though is I just

  became like there's just so much else to

  do and so many other things that like if

  I'm trying to be on every Apple platform

  as a one-man shop it's essentially

  impossible now and so I looked at the

  Apple TV and I'm like it's gonna be a

  long time before there's a big market

  there and so I just didn't prioritize it

  yeah and you know and I feel like you

  know we're coming at this from from two

  different viewpoints here you know I'm I

  tend to work on a very small

  I tend to work on usually one app for a

  span of years I very rarely have

  additional apps I'm not very good at

  splitting my time between multiple apps

  I pretty much just do one thing and I

  try to make that one app big and

  complicated and appeal to a ton of

  people in order to to keep it going

  whereas the background you come from is

  is I think much more interesting

  honestly because you know when people

  and this is one of the reasons I wanted

  to do the show with you and one of the

  reasons I wanted to call it under the

  radar because when people do when people

  think about Apple developers they tend

  to think about the handful of well-known

  ones who make mass consumer apps that

  you may have heard of so apps like tweet

  bot or net newswire and or you know the

  apps from panic that that you know a lot

  of developers have heard of or use or

  wowed by and there's this massive number

  of developers who we don't usually hear

  about in in the circle of like Apple

  enthusiasts and tech bloggers and stuff

  and I think you are a very very good

  example of of this massive market and

  and I think you you do it better than

  most people would do it and so what you

  do is not like the high profile you know

  a high attention mac blogger long term

  ecosystem kind of thing

  you do something way more pragmatic and

  so can you maybe you just go into that

  briefly for anyone who doesn't know you

  yet from who's listening to this for

  some reason can you go into like what

  exactly you do and and how you got there

  so I yeah so I've been an iOS developer

  essentially since the AppStore started

  about seven and a bit years ago I didn't

  quite make the day one of the AppStore

  mostly because of like business approval

  stuff but I've been developing ever

  since then and since then I've launched

  I think I recently worked this out to

  something like fifty-two unique app

  concepts in the last seven years so it

  works out to be about once every one

  every two months or so it hasn't been

  exactly that even if a pace but that's

  roughly the average and but I've been

  making a good steady comfortable living

  from it for about six-and-a-half of

  those seven years and so I I have lots

  of different products in a lot of

  different areas my tend to like at this

  point I have probably five or six that

  are like my main income makers and they

  each the biggest one of them only makes

  up a third of my income so it's a very

  diversified type of thing and that's my

  the approach that I found that works

  well for me is to make lots of small

  bets and see which one pays off in the

  store rather than trying to take the

  approach like with overcast if I

  remember right it's like you spend

  eighteen months working on it YUM as

  like a big major focus and like for me

  the longest I've ever spent in a product

  before I launched it is probably four

  weeks or something along those lines and

  so it's a very different kind of a focus

  where I'll put something together I'll

  put it out in the store I try and make

  it like good in quality but very

  straightforward and you know see what

  happens and that approach means that I

  end up now with a lots of different

  products doing a lot of different things

  and you know I'm as if it's you know I

  have the benefit of diversity in terms

  of stability but the difficulty in terms

  of keeping up with things when I have

  such a wide sort of portfolio to manage

  and one thing I like about the way you

  work as well is that you challenged

  assumptions that

  any of us in like the the other half of

  this community don't challenge like you

  will like you you make your income in

  part from I add I don't know anybody

  else I'm I don't think I have any other

  developer friends who have a meaningful

  presence with using I ads and and you do

  and you will challenge assumptions based

  on things like monetization support app

  concepts I'll design like all sorts of

  stuff that that you challenge and and I

  think you benefit from that because you

  while everyone else's is locked into

  this one way of thinking and trying to

  shape the App Store into like trying to

  like you know educate consumers into the

  way they think the App Store should be

  you are out there actually adapting and

  and thriving and what the App Store

  actually is yeah I mean I I think I try

  and think of when I look at the App

  Store think is a business in general

  like I can't change my customers all I

  can do is react to them for them for the

  most part like I like using things like

  people who should want to pay for

  software as like a statement it doesn't

  make any sense to me like people are

  going to want to do whatever they want

  to do and like my job as a developer as

  a businessman is to look at the market

  that I'm I want to work in and find ways

  to adapt my business to it and I don't

  just use I adore advertising like I make

  the majority of my income from

  advertising and I add and that's been in

  somebody's been far more stable than any

  of the more paid or subscription or

  patronage or all the other things that I

  have like the most stable income I get

  is from advertising and I love it

  because advertising is great because it

  I've it the likely Adelines developer

  and customer like goals like my goal is

  to get them using the app as much as I

  can because the more they use it the

  more advertising income I make and from

  you know if they're using the app a lot

  that means they like it and so for me it

  was a no-brainer to get started but it

  definitely is I know what you mean like

  it's it's a bit counter to I think a lot

  of the it's not necessary

  pretentiousness but there's a there's a

  definitely that air of like like you

  want Apple you want to sell an Apple

  like product in the App Store

  but that doesn't necessarily work

  because apple doesn't even sell apple

  like products in the App Store

  yeah and I think this was all like I

  think this was all rooted in the the

  community of like kind of like nice

  Kraft Mac independent developers that

  that has existed for quite some time on

  the Mac before iOS and everything became

  really so big you know people like panic

  or delicious monster you know people

  like that

  brent simmons dave wantanabe like

  there's this crowd of like kind of old

  school the old guard who have been

  around for a while you know omni group

  is a big one who've been very successful

  at this and and many of them continue to

  be very successful at this but there was

  this idea for so long that many people

  still hold that that would translate

  into iOS and that also any developer who

  would be able to program iOS apps would

  kind of think that they deserved that

  same level of success if they just put a

  lit there at all or if they put you know

  a lot of work into something and and

  there's many problems with this that are

  way too long to discuss in a 30 minute

  podcast one of which is that that the

  amount of work you put into something

  does not correlate to the value that the

  market will place on it or the amount of

  money you can make from it but I think

  it's productive to challenge this notion

  of like well you know is this really the

  way the world should work and and

  regardless of whether I think it should

  work this way if this is not the way the

  world works like in practice

  what what can I do as a developer to to

  succeed in this market and sitting

  around waiting for the market to change

  to benefit you is probably not very

  productive because that's just unlikely

  to happen yeah and the interesting thing

  I was wondering what you think about

  this cuz I'm seeing the the spread of

  the of your app career in the App Store

  like he's starting an instant paper

  which was paid upfront $10 if I remember

  right yeah the whole first year it was

  10 bucks and I dropped at the 5 minute

  and then it's like following the

  progression then I think you know your

  income started to shift in some ways

  more to subscription and in-app purchase

  and then switching entirely to overcast

  where it became it was you know free

  with in-app purchase

  four features and then now it's entirely

  free with like patronage support mm-hmm

  it's you've done you've essentially

  followed the trajectory of the App Store

  in that way right you're starting with

  like the the old school kind of well

  it's it's premium software I should

  charge a lot of money to it's still good

  software but the way you pay for it is

  completely different right and and most

  of that has again just been because I am

  like I'm not like thinking I'm like you

  know treading new ground and being an

  explorer no I'm usually coming to these

  to these changes late actually like I

  like instapaper holding the price at $10

  for the whole first year was a mistake

  when I dropped at the fives

  sales went up considerably and then you

  know later on it dropped to three I

  think I held it for a while three or

  four and then you know in sales were

  pretty good then I started experimenting

  and then shifting to subscription that

  that ended up making way more money than

  I thought it would and doing very well

  and then with overcast coming out at

  free with in-app purchase and now with

  patron eggs like those have all done

  better than I expected them to and you

  know it this is all about just adapting

  to what the market is many people blame

  the market on on you know Apple not

  implementing upgrade pricing or the App

  Store not having good enough discovery

  or search and and all of those things

  are valid complaints but they're not the

  biggest problem the biggest problem is

  there's just a huge oversupply of

  developers and apps who are who are all

  trying to compete for the same dollars

  in the same roles in the same time and

  attention and so you know back in the

  olden days when you'd have like panic

  and omni selling mac apps for 50 bucks

  that worked in part because of what they

  were and what people use max for and who

  was buying max but also that worked in

  part because there just weren't that

  many developers doing it if you would

  have had 10,000 developers trying to

  make the same handful of nice consumer

  high-profile mac apps you would have had

  the exact same problem back then

  it isn't that the market has has like

  gotten stupider or cheaper or anything

  like that it's that this is now the mass

  market of what developers do it wasn't

  you know back in 2006

  most developers weren't working on mac

  apps now most developers are working on

  iOS and web apps and a span I think it's

  I think the shift from web to iOS apps

  is really pretty pretty significant and

  so if you think about just that's what

  so many developers are working on of

  course was going to be a massive

  oversupply and of course there's going

  to be tons of competition and a race to

  the bottom and pricing and that's not

  because apples doing something wrong you

  know Apple is not helping in certain

  ways but they're not the cause of this

  problem and you know again pragmatically

  it is it is useful to think of yourself

  not as somebody who all you need to do

  is is ship a nicely designed polished

  app and money will start flowing in but

  as somebody who has to really fight like

  really like work hard and fight hard and

  be lean to try to attract any kind of

  attention and any kind of money from

  what is a very crowded hyper competitive

  market and I think it's also that the

  biggest trap that I know I struggled

  with for years was untwist this over

  this feeling of over valuing my own work

  that if I spent a long time working on

  something that everybody should then

  sort of oh it should it somehow

  intrinsically that makes it more

  valuable to people right that they look

  at something it's like whereas when like

  when people are going to part with money

  in whatever form that is like whether

  that's right or I guess part with

  something like their attention their

  money their it they're exchanging

  something for that like there they need

  to be feel like they're getting

  something in return and the funny thing

  is I think a lot of people think that

  software intrinsically should feel

  valuable like as their like the classic

  that oh it's it's people will spend five

  dollars on a latte but they won't spend

  five dollars on my app and it's like

  well maybe they actually want the latte

  more than they want your app like your

  app may not actually be that that

  valuable to them and that's why they're

  they don't want to spend that money on

  it's like you have to be able to wrap

  your arms around what they're actually

  buying with that like is it

  entertainment is it productivity is it

  amusement is it

  are they exchanging goodwill for money

  like things like when you start to get

  into like I know I've

  and an app with the tip jar in it or you

  have patronage and overcast now like the

  uric sense they are cure providing a

  mechanism for people to exchange

  goodwill for money is really what your

  have what you're doing there and unless

  you're able to really wrap your arms

  around that it's hard to really like be

  okay with saying like that's okay like I

  do advertising because for a lot of my

  apps like the app itself isn't

  particularly valuable to the person it's

  useful but it's not necessarily valuable

  in a way that for a lot of people they

  want to play we want to put money into

  it directly once they used to once they

  use it for a while and like it they are

  willing to piss spend money but they're

  not spending money for the functionality

  they're spending money to be able to

  express the goodwill they have towards

  me for the benefit I've given them but

  that's different than it being

  intrinsically valuable to them because

  when they started they didn't see it as

  valuable they wanted it to be free and

  if it wasn't free I don't think like

  I've you know my pedometer a pedometer

  plus plus wouldn't have sold at all or

  at least in that not in large quantity

  that it has you know to this point yeah

  you know even as a consumer of apps now

  I find myself even as somebody who has

  been a proponent of paid apps for so

  long and sold one for so long when I

  search for something in the App Store

  and I see the search results list you

  know if I need if I needed something

  that I'm not looking for a specific name

  where I'm just looking for a specific

  type of app so a pedometer or a step

  count or whatever you know if I search

  the App Store and the first 20 entries

  in the search are all free and number

  twenty one is four bucks that one

  doesn't stand a chance like that's just

  and that's just the reality of how

  people search the App Store and and it's

  it's very important that you know as you

  said like to recognize that and and you

  know to recognize that not every app

  that Avery that every developer makes is

  going to be worth a non-trivial number

  of customers spending $2 on it or

  whatever you know like I mean I've seen

  so many apps that do things that I don't

  really need you know like like so many

  apps that are things like coffee timers

  well you know if a coffee timer is

  really good and it's free I might use it

  or I can just use the built-in timer on

  the device that's not as good but it

  works and I think a lot of people go

  through a similar kind of thought

  process of you know if you if

  it's such a different barrier than than

  any price and and if you're if you're

  looking at an app the alternative isn't

  just every other app that's in the store

  that does that same thing

  the alternative is also just

  non-consumption it's not buying the app

  at all not buying any app and just going

  without that role in your life and as we

  get more and more and more apps in the

  store which is only you know that's been

  going on forever now as we get more more

  apps in the store and more and more

  demands for people's attention and more

  more alternatives that they can do like

  if they don't download your app they can

  go check Twitter for a few minutes or

  play a game and as we get more and more

  of those things more more competition

  for everything non consumption is also a

  big problem and so anything you can do

  to to address non-consumption to address

  people just bailing out and abandoning

  this this search that or this idea they

  might have had that this thing they

  wanted to do and going free is a huge

  hit against that like if you can remove

  that barrier of price upfront then it's

  so much easier for people to say you

  know what yeah I'll give it a try and

  it's then I guess the reality is that's

  how I think we've both been able to

  continue in in the App Store at this

  point and we've been doing it for a long

  time who is I ever anecdotally it seems

  like fewer and fewer smaller or lot more

  independent companies and where people

  are able to do it and I do you think a

  lot of it is that it's a lack of

  pragmatism that a lack of just like what

  is it going to take to make a living in

  this market and if you ultimately don't

  like the answer to that if you're in

  your mind you'll you only want to sell

  software in like a premium App Store

  it's like ok well you might need to do

  something else then because that may not


  yeah and you need to be in the right

  place at the right time if you want that

  you know if if if you will not budge in

  that like so right now so getting back

  for a second to the Apple TV which is

  getting out now the Apple TV app store

  has almost nothing in it it is very very

  sparse and if you are looking for

  something like like so I got this Apple

  TV I plugged it in set it up and I went

  right to the App Store to see hey what

  can I get here and I thought a couple of

  basic you know Netflix HBO now whatever

  and then okay let me try some games I

  got this cool thing I'm in the mood of

  trying new things let me go to the App

  Store and try some games and I went and


  I don't know ten bucks maybe total on a

  couple of games and I didn't even think

  about it because I'm in this buying mood

  because I just got this new device it's

  brand new has me excited and also

  there's hardly anything there to buy and

  of the very small number of games there

  were there to buy almost all of them I

  think we're paid or at least many of

  them were so I had no problem spending

  that money because of the context of

  this isn't a tremendous App Store filled

  with millions of apps most of which are

  free this is a very very small App Store

  that right now that has only very few

  apps on it and you know that's that's

  that's the reason I was able to charge

  10 bucks for Instapaper in 2008 you know

  but but then I couldn't in 2009 because

  the after was too full that's gonna

  happen with the Apple TV also you know

  if this thing takes off if this succeeds

  and and it looks like it's probably

  going to I mean it might take a few

  years before it has like tons and tons

  of Units out there but it's probably

  going to succeed and if that happens or

  as that happens there the App Store is

  gonna be way more crowded than it is now

  and it is going to get harder and harder

  to sell games and apps for the Apple TV

  for money once there is competition for

  for that same role in people's lives and

  so if you if you were gonna be the kind

  of person who wanted to sell a premium

  app for money

  you just had a window to do that on the

  Apple TV almost no one has taken up that

  out that opportunity but you just had

  that opportunity right now and it won't

  come again on the Apple TV probably ever

  you know at this like this product and

  that has now done that and it probably

  won't come again yeah and so you have to

  wait till the next big wave and you have

  to be in one of those positions where if

  you're not going to to be in a if you're

  not gonna be the kind of person who can

  thrive in an ultra competitive

  low-priced environment like the web has

  pretty much always been and like the iOS

  App Store is now then you have to follow

  the trend and be early to things be

  there on day one when new things happen

  be able to be able to figure out and

  guess which new things will take off

  which is a hugely risky process that you

  will often get wrong and it will often

  go completely to waste and and be there

  in those less competitive markets but

  then as soon as the market becomes more

  competitive you have to either adapt or

  leave yeah and I think the difficulty

  honestly with Apple TV and why I well I

  think I agree

  like the best time to sold big software

  would have been like if being there on

  day one my suspicion is the narrowness

  of the window where there's going to

  have that kind of general rush in people

  being okay with buying things is narrow

  enough that I'm very skeptical if it

  would actually be financially successful

  for most people that if they had you

  know spend a lot of time made it a nice

  big premium game or something like that

  especially designed specifically for the

  Apple TV the window in which they were

  going to be able to to sell into a kind

  of a premium group of people like people

  who obviously were excited enough about

  the product to get on day one they're

  very you know they've just spent a red

  for in Apple terms a relatively small

  amount of money for it you know it's a

  they're not nearly as expensive as a lot

  of the other other products that you

  know I can iPhone $700 or something

  whereas this is a hundred and something

  or two hundred and so that window is

  going to be very narrow and so if you

  are worried if your app requires that

  you then have big sis that you know big

  sustained sales over the next few months

  my suspicion is that's going to be a

  losing proposition and so that's

  interesting and you know it's the Apple

  TV I think will be a nice sort of much

  ways like many ways like the watch it's

  just an add-on to the main product that

  Apple sells like which is the iPhone

  it's like the iPad in many ways the idea

  to watch now the Apple TV these are all

  just add-ons to get di OS ecosystem that

  exists for the iPhone yeah and and you

  know and I think the the value that you

  can get out of being there yeah I think

  you make a very good point about about

  that window being fairly narrow I think

  how narrow it is depends on how easy it

  is to develop for it and how many people

  realize how quickly they need to be

  developing for do they want to be

  developing for it so with the iPhone

  that was very very quick really because

  the iPhone already had a massive

  installed base there was tons of pent

  demand to develop for it and people like

  not the doors down to get there most

  platforms don't work that way the watch

  I think has has kind of fizzled out on

  the watch I think is kind of at a

  standstill right now I don't know of any

  really interesting stuff that's happened

  on the watch

  last month say you know it seems like

  not a lot is going on there and we'll

  talk about that in future episodes I'm

  sure yeah and the TV is now out but it's

  starting from an installed base of zero

  for a product that people are excited

  about but not so excited that they're

  gonna go out and like raid all the

  stores and deplete all the stock on day

  one so it's gonna that's gonna have a

  slower build-up and so if that buildup

  is slower also on the developer supply

  side where fewer developers are jumping

  in so soon so quickly then I think you

  do have a wider window like I would say

  the biggest sales day for Apple TV apps

  this year is gonna be the day after

  Christmas and if you are there I think

  you can still sell a nice $10 game the

  day after christmas in in big volumes

  this year but probably not next year

  let's see yeah I would say I'm more on

  the skeptical side of that but I think

  you're right insofar as that's a

  reasonable it's going to this the next

  few months will be interesting for it

  and I think the Apple TV

  I will ultimately develop for it though

  and which is probably a good place to

  wrap up is to say like I expect to make

  make apps for it mostly because having a

  nicely rich

  it's a checkbox that I can check for

  form up from some of my applications to

  say like could make them just that

  little bit more appealing to somebody if

  someone was on the fence about

  downloading my app and they're like oh

  it'll work for the Apple TV awesome then

  it's like that little little thing but

  it's not a priority for me insofar as I

  don't think it's gonna ever be a primary

  driver for my business it's like same as

  the watch I make watch apps for a lot of

  my apps mostly just so that it's like if

  someone if for the narrow group of

  people for that's all they needed to go

  over the edge then it was worthwhile for

  me but in and of itself it's probably

  not yeah and that that could be a whole

  beside right there

  and I I totally agree with everything

  you said that I'm also I expect to to

  launch Xcode for the first time to make

  an Apple TV app probably this week I'd

  like to see how easy it is to get

  overcast or run on it but again it's

  like it's it's kind of a value add to

  use a business term I'm sorry it's kind

  of that for overcast on iOS in general

  rather than like I don't expect to make

  a lot of money on the Apple TV by itself

  but anyway we are running out of time

  this week so we want to keep the show

  nice and short so people can listen to

  it quickly and don't feel overloaded by

  it so

  let's wrap it up this week David thank

  you I guess

  I don't know we never done an ending

  before we're gonna have a song so what

  are we gonna do

  just stop probably just stop all right

  thanks thanks for listening whoever's

  listening to this and hopefully we will

  see you again for the next episode yep

  see you under the radar