What is wrong with the software product economics

I was looking for a piece of software to help me sftp to my office machine, with a nice drag-and-drop GUI. I found fetch. These folks did a fine job at designing a nice GUI. They sell it for $25 a piece.

Nothing wrong with that. Except that I am not going to pay $25. And I will not use their software.

Why?

Because I might use such a specialized piece of software a few times a year. How many people FTP files all day in 2007? If you have to do so, you probably have deeper problems.

I have stopped buying software, with a few small exceptions, a long time ago. Essentially, the only software I am willing to pay for, is software I use every (work) day. Or games. But I don’t really buy games these days, something to do with having a family and a research career.

There must be also no free alternative that can compare. But with the flurry of nice Web 2.0 applications and free software applications, this is increasingly a small niche. There must also be no vendor lock-in: I dislike growing a dependency toward a vendor.

Meanwhile, publishing software as open source and making money off it is not getting any easier.

How are people going to make money selling software products then?

They are not. This is a dying industry.

You need to sell services, just like lawyers, teachers, and doctors do. And that’s what most programmers do, one way or another.

Wait! Don’t I buy books, DVDs and other non-software products? I do, but most of what I buy comes from China these days. It has been mass produced by underpaid workers. DVDs and books are maybe an exception, but the number of writers who can make a living off their books is small. Very small.