Apps cite ‘Ship of Theseus’ for shift to subscription model

Business Technology

Developers prefer subscription over one time purchases but consumers say that the plans are expensive.

The Ship of Theseus argument is one of the oldest thought experiments in existence. Named after the mythical founder-king of Athens, it questions whether an object that has had all of its components replaced remains fundamentally the same object. The app developers are using the same argument to charge subscription fees from customers who have already purchased their apps.

Sebastian from team Lux, the team that developed the Halide camera app, said that they shifted to a subscription model in 2021 and gave a one-year free subscription to consumers who had already purchased it. They promised that all existing features would remain free for them, but they would need to pay a subscription fee to use any new features added after their purchase. Sebastian said that they shifted to a subscription model because they have added new features to it in the past three years and ‘it (app) is not the same anymore’. He added that they wanted to generate more revenue through the subscription model to support their small team. They still offer a single-time purchase option to consumers for $120. Earlier the price was $5.

Marc Provost, Director at Ginger Labs, said that they recently shifted their popular application Notability, a note-taking app, to a subscription model and offered all older customers a free subscription of one year. They used to charge $7 for a one-time purchase of the app, but they changed that to a yearly subscription for the same price.

Saikiran, a consumer who uses the Notability app, said that he purchased the application in 2015 for his iPad and has since been using it. But he is unhappy about the sudden shift to a subscription model as he has to pay every year for the app he has already purchased.  He added that the other apps he uses, like Lightricks and Adobe Creative Cloud apps have changed to a subscription model and he cannot pay for everything annually since it will create a burden on him financially.

Marc said that their app was introduced in 2010 and they have added many features to the app through upgrades and that it is no longer the same software. As a result, he defended the subscription model as a positive approach to their software.

Iryna Begma, head of growth at Setapp, bundles multiple apps into one subscription.

She added that they offer 230 apps in a single subscription for both Mac and iOS. They started with 29 apps in the year 2017, but they have added 200 more apps in the last four years. By taking the single subscription they offer, consumers are saving thousands of dollars in subscriptions every year.

Rahul, a consumer who purchased a Setapp subscription, said that he finds it cost-saving as it offers many apps at a single base price. Although he doesn’t use the entire 200 plus apps they offer and he finds only a few of them useful to him.

Begma said that the price of the subscription has remained the same since they launched Setapp and they are adding more and more applications which are good for casual consumers who don’t need specific apps for their workflow.

Rahul said that the Setapp subscription is a very good offer for casual consumers. However, professionals don’t have an advantage as they need specific applications.

Begma added that they offer multiple subscription options.  Mac users can get it for $9.99 per month or $107.88 per year. If a consumer wants both Mac and iOS apps, it will cost$12.49 per month. There is a family option of $14.99 per month or $161.88 per year that offers the apps for up to four devices.

“As the software matures and develops, the developers that maintain it through updates want to generate income, so they are transitioning to subscriptions instead of a single purchase,” she said.

According to Dr. Parvathamma G.L., Professor of Economics at Bangalore University, companies and app developers are going the subscription route to generate more revenue because they get a guaranteed income annually.

“Every application wants to be like Netflix, which generates billions of dollars in revenue every year. As software applications play an important role in consumers’ lives, they want to tap the market with subscriptions,” she said.