One of my favorite open source projects is Joomla. Its an incredible content management system, and it has a great third party add-on community – most of which release their add-ons under the GPL (there are reasons for this, not applicable here).  Ive bought a number of these. But since they are GPL, I should be able to get access to the source code and effectively get them for free, right? What and why pay?

Many vendors come up with service based plans – which sad to say, mostly fail to deliver value. They disappoint the customer, and I suspect they ultimately disappoint the vendor. Here are some things they do wrong, and also how they can fix the problem.

• Provide meaningful fixes. If you charge a subscription fee for access and support, you should be continuously updating the product. Short cycles with 1-2 main new features and lots of user requested fixes. That means lots of continuous updates. This style also makes subscription payers believe they are getting value for the cost.
• Fix the stupid stuff. There are issues which have workarounds, but that doesn’t resolve the inconvenience you are foisting on your customers. Not fixing the stupid stuff demonstrates you don’t understand how convenience translates into what your customer values.
• Understand what support is.  Support is getting answers when expected and needed. That requires timely feedback. Support is not the same as a community forum or public Q&A system. Those things are in addition to support and may reduce the workload of support.
• Understand what documentation is. Documentation isn’t a Q&A system or forum. Documentation is ordered instructions. Documentation explains complex topics and processes in an ordered way. You don’t have to search through 27 pages of forum posts to find an answer in documentation.
• Understand how evaluation works. Some customers are going to be more conservative than others. They want to see documentation and they want to see dedication. But usually those who are justifiably conservative don’t mind paying subscription rates.
• Don’t hide your identity. Of course, you don’t want people calling you to ask for free support. Hiding contact information, who you are, where you are located – these make you look small time an unbusinesslike.  Work up a methodology for dealing with support calls .

If you aren’t providing any service, then its hard to expect a good revenue stream from open source projects. If you are providing service – charge what you need to charge – but then deliver what your customers need. You don’t have to give away your lifeblood on open source.

In the agency model and in regular retail practice, the reseller is a kind of conduit to customers.   By way of distributors, products appear on shelves. Resellers buy, based on a percentage of the suggested retail price. The reseller is entirely free to set their own prices (with certain exceptions) and compete with other resellers in the market. Resellers also generate additional revenue off of selling advertisements within their circulars, charging for end cap or point of purchase promotions or other in-store experiences. The agency model works quite differently.Under the agency model, the manufacturer controls the retail price. Now this might not seem so strange to folks in Apple Land, since Apple has long used MAP (Minimum Advertised Pricing) to ensure the level of pricing in retail. But even MAP allows for some variation, and some resellers have gotten around that. For example, some venues like Amazon might not show a price for a product until you put it into your cart. A well known USA East Coast reseller used to automate pricing display on their website in order to trick Japanese manufacturers who would check on site prices during the daytime in Japan (that didn’t last long – people in Japan tend to work late).

Broad pricing competition means something different now that the focus on retail is online.  Manufacturers have developed their own direct to consumer sales strategies, which means they compete with their own distribution channels.  A manufacturer’s direct advertising price is effectively the same as the suggested retail price, meaning resellers may be able to use that base price as the point upon which they base their own margins. That is why you also find many electronics stores allow price matching if you find the same product sold through another venue at a lower price – they have a means to fight back.

MAP and the agency model are price control strategies. If prices are effectively the same, then people will buy from a specific venue based on other factors than price – convenience, trust, delivery benefits or the like.  Apple is the master of this. Invariably, anyone who invests and loves Apple’s products will choose first to buy through Apple itself, if they can – provided that the price they pay is not significantly more.

By being present and bundled with Mac OS X, Apple has guaranteed that any developer with a deep interest in the platform is going to be present, or at least have some sort of strategy to counter competitors that are present. You don’t need to be in the Mac App Store to be a developer for Mac OS X, however you will be severely disadvantaged against competitors that are there and the trends found there.

I’ve been selling Shade 3D on the Mac App Store for a while now. Shade 3D is a sort of sub-version of Shade Basic, the entry level product in the Shade line of 3D modeling, rendering and animation products. A few things I have learned along the way:

• Price matters. It matters alot. If you do not have an understanding of consumer habits (and that’s what the market is on Mac App Store, consumer) you are at a big disadvantage. You either adapt to consumer focused pricing or you adapt your product FOR  consumer focused pricing. Because of this, traditional pricing may get you bad reviews on Mac App Store.
• Gaming on Reviews. Review gaming is where the problem lies – Mac App Store promotes low prices. Low prices also make it easy for people purchasing for the sole purpose of writing a bad review. Developers have no input on what reviews show or do not show – there isn’t a provider “talk back” mechanism when, say, someone writes a review that misrepresents your product (it doesn’t have feature X when it actually does).  We’ve had customers come and demand upgrades or other gifts with the threat that they will give a bad review on the Mac App Store if we do not comply. The vendor should always have the option to either challenge or remove a review – base it on what the BBB does if you need a specific model.
• Default Sorting.  Think of sorting like using Google ranks. Those that appear in the upper part of the page get looked at. Many people do not scroll down. Even more do not look at a second page. No matter how good your product is, default sorting based on price or popularity creates an environment which encourages developers to try to game it, just like SEO specialists do for gaming Google ranking.  Note to Apple: default sorting should always be on New or Updated. Developers that regularly update their products have their customers in mind.

Change the playing field of participation on the Mac App Store and you’ll see less gaming.

iBooks Author is some sort of chimera. Its a wonderful looking publishing tool, until you actually get to the publishing end. First, you absolutely will need a reasonably modern Mac to run this. On the publishing end, either you go the route of using an aggregator publisher (who will take their % on top of Apple’s 30%) or you’ll be spending on the likes of getting your own ISBN number for your book. Between the Mac and the publishing, you’ll also need a testing device – add in your iPad cost there.

Either route you go, even if using an aggregator, your ultimate publisher still remains Apple. How easy will Apple make it to take your same iBook Author files (which presumably uses the ePUB 3 format) and repurpose them for free or for delivery on other devices? That’s the real question here, and it makes all the difference. Sure, Apple has no interest in supporting an alien platform. However isn’t being locking into a closed garden environment like the iPad contrary to the fair use mentality you find in the education market? Also, doesn’t this deprive universities of additional revenues that are generated through university bookstores?

I can see the big publishers supporting this in a limited way. They want to be as close to the most popular trends in publishing for fear of being seen as a dinosaur. Yet these same big publishers must realize that, once their complete catalogs get published as iBooks, Apple suddenly owns their channel, and converting that into a complete publishing solution that removes those big publishers from the process is the next step. Most likely, they see this as an opportunity. Let Apple define a methodology and delivery mechanism and then duplicate it using a less expensive platform – namely, ePUB 3 documents through Android devices.

Really neat business plan, Apple. Now produce a $200 tablet and open up the garden.

I can also understand why some Mac OS developers focus solely on Mac OS X development. For one, if you are a professional developer and only supporting the one platform, you code in Xcode and probably are coding in Objective-C. C derivative languages require a huge investment to learn. There are RAD tools that will let you create software for the Mac without a comprehensive study of professional software development – not Objective-C. And Objective-C really isn’t very portable to other platforms anyway. That’s why many Mac OS developers use the more portable C++ instead.

So if a developer creates an application on the Mac that leverages all the most current, interesting features exposed through the lastest OS update, without any consideration of porting to Windows or Linux – yeah, I get it. There are plenty of application categories where it may not bring any particular benefit. For example, a specialized word processor (for instance, ones focused on novel writing) that is Mac OS only is understandable, especially if it supports exporting to any number of open standards (or at least one that can be read my Microsoft Word).

The ones I do not understand are ones that would benefit from cross platform collaboration, such as project management software. Omni Group, a well known Mac OS developer, developed a product called OmniPlan. This follows in the steps of another very good tool called Merlin from Project Wizards, that unfortunately is also Mac OS only. You really need to be in an all Mac shop to pull this off – anyone who is a collaborator within your own company is going to need a Mac just to use this software. Yes, there are quite a number of all Mac using companies, so at this level it may not be such a bit issue. But this problem extends beyond simple choice but also into specifics of your industry. In many industries, clients are also collaborators, and can you reasonably expect your clients to also be Mac only?

Excluding search engines or other forms of cataloging of rogue content leaves the barn door open.  Too many warez focused websites generate their revenue by cataloging other sites (often also owned by the same company that owns the search engine – not talking about Google here) and attaching revenue generating advertising systems to them. Such search engines or catalogers should in turn, receive notices of who these rogue sites are and be required to remove them from their catalogs (ie blacklist those sites), if they want to remain within a safe harbor.

What Eric Goldman likes, but I do not, is the definition of a rogue website. The internet is an amorphous entity that has little to do with borders, however a substantive amount of that traffic goes through the United States. The United States should first and foremost enact laws that protect US citizens and the interest of the United States, and then allow negotiations to begin via foreign trade policy on a partner-to-partner basis so that its partners’ citizens can also benefit from it.

What many people do not realize is that the United States routinely places itself at a disadvantage because it does not usually work this way. For example – consider in the late 1980′s when France wanted equal access to Japan’s automobile market that France was giving to Japanese companies. Every vehicle that was imported into Japan had to undergo an inspection, and the inspection center was hundreds of miles away from the ports where vehicles could enter the market, vastly increasing the transportation costs of imported vehicles.  In response to an unbending Japanese government, France set up an inspection center for Japanese imported vehicles that was hundreds of miles away from the port within France – and only vehicles from Japan or Japanese companies had to use it. The end result was that, when it came to this particular problem, France and Japan found a common frame of reference and the problem was later resolved, because it was a tit-for-tat negotiation between partners. As onerous as some provisions are (in SOPA or even OPEN), most of our valued trade partners have IP to protect. They too, want equal protection under US laws for their intellectual property because of  revenue generated from within the US market.

Mr Goldman also seems to like the minimizing the scope by narrowly defining harmful portions of websites rather than the websites themselves. That’s the same kind of gutlessness we have now with DMCA takedown notices.  A rogue site gets a DMCA takedown notice, removes the illegal posting – then its up again the next day. By accepting the DMCA takedown notice and not challenging it, the website owner is, in essence, agreeing that the posting was illegal. Allowing illegal posts to continue by the same poster is contributory. For this reason, the website owner must have a uniform way of dealing with these illegal users with some assurance that the same person won’t easily create a new, duplicate account to continue.

I am glad to see Senator Wyden finally coming up with a solution.  It is a start.

There is probably an answer to this, boiling down to distribution issues. Perhaps they want to have a different priced Spanish only version for sale in Mexico, Central and South America?

The problem I have is that region based customization of movies invariably reduces enjoyment for folks like me.  I always watch with English or English SDH (English subtitles with descriptions for people with poor hearing), regardless if its a foreign film or not, primarily because audio levels can vary so much in film. Also, I have a non-native speaker of English at home. We never watch dubbed films as the substitute voices invariably change the tone of the story. For example, when the X-Files were released in Japan, Agent Mulder was given a very masculine voice, while his partner Scully has a high, cute woman’s voice – entirely contrary to the personalities of the characters. That’s not to say that subtitling is perfect. I have watched enough films in Japanese to know that the subtitle writers must have been munching on magic mushrooms to produce the wildly different translation.

Unfortunately, many people do not see that theft of intellectual property is theft – and that’s bad for the country. It is bad for the country because intellectual property is the future of commerce.

How so? Good business moves manufacturing to the location where corporations believe they can get the most value for the work. Manufacturing (as opposed to craft) value varies from one industry to the next, but constants always include 1) time and cost to market, 2) actual cost of manufacturing and 3) amount of risk associated with the costs.

States such as Oregon which Senator Wyden serves pray for large manufacturing companies to set up shop. Some do – for special tax incentives, or they may have some other, non business reason for doing so.  The vast majority though keep sending the work to markets where manufacturing costs are the lowest.  Low skilled jobs have no future.  Intellectual property has a bright future, but only if you have a society that protects its value and nurtures its next generations with a good education.