For the past eight months, I’ve been working full-time on the development of Halftone 2, a follow-up to Halftone. The app was released on May 23rd as an Apple Editors’ Choice, and since its availability, I’ve received many one-star reviews in the App Store and a lot of passionate e-mail from users who seemingly despise the idea of the freemium business model. This strong feedback is causing me to reconsider my plans for Halftone 2.

Background

The original version of Halftone (henceforth referred to as Halftone 1 to avoid ambiguity), has been available in the App Store since February, 2011 for $0.99 USD. While it has enjoyed a surprising level of success, I’ve always wished that more people could try it. You see, the word halftone is unfamiliar to most users, and the app’s comic bent isn’t reflected in its name. I decided early on in the development of Halftone 2 that I would follow Paper’s lead and release a free app so that more people could try it at no risk and only purchase items that they need.

Reactions

A few days after Halftone 2 was released, I received e-mail from a teacher whose school uses Halftone 1 in the classroom:

Just a little word of warning, the problem with the Freemium model is that in-app purchases cannot be purchased via the Apple Volume Purchasing Program (VPP) so teachers cannot purchase the necessary upgrades to use it on all their iPads.

Unfortunately, I wasn’t aware of this limitation (my wife is also a teacher). The e-mail went on to state that apps like Qrafter have made a special version specifically to allow VPP users to purchase the full version of the app. While this is a clever solution, I dislike the idea of having two nearly identical and potentially confusing apps in the store.

By far, though, the negative feedback I’ve received from users is related to the freemium model itself, even if it’s not referenced by name. The feedback can be grouped into a few common themes (actual quotes):

• Limited functionality: “The app in its free form is so crippled that it is unusable.”
• Enhance only: “In app purchases should be used to enhance an app and not enable it.”
• Required purchases: “…which only reveals its potential after forking out wads of cash is bordering on the criminal.”
• Pay upfront: “I’d rather just pay and be done with it.”

Rationale

As a one-person independent developer, I endeavor to create apps that people love and can—at the same time—financially support my wife and me. A free app that includes all content and functionality would be fantastic for users in the short term, but lacking any revenue, I’d eventually have to shutter Juicy Bits, and users would lose out on bug fixes, new functionality, additional content, and support. Clearly, that isn’t a sustainable business model.

So, I’ve organized the in-app purchases in Halftone 2 to coincide with content and functionality groups that users have requested. Of the five in-app purchases (one is a bundle that includes everything), only two of them include additional functionality, and all of them include more content.

The Pages in-app purchase adds the ability to work with multiple pages and export to multi-page formats like PDF and CBZ. Based on feedback from Halftone 1, the vast majority of users don’t want to create multi-page books, so I wouldn’t think that the lack of this feature could be considered “crippled.”

The Fonts in-app purchase enables customers to create multi-colored outlines around text. Nobody has ever requested this feature, and as of today, I haven’t seen anyone actually use it (while I don’t collect metrics, I do monitor Twitter posts for Halftone-tagged photos). Again, it’s difficult for me to see the lack of this feature in the free version as being “crippled.”

Even the base version of Halftone 2 contains a lot more functionality than Halftone 1: saveable projects, a document gallery, multi-page projects, multi-photo pages and layouts, much more sophisticated and capable captions and balloons, new stamps, additional color options, photo panels that can clip other elements, full undo and redo support, a custom vector-based file format, 3D anaglyph output, and more. For comparison, I’d say that Halftone 2 is similar in complexity to Apple’s Keynote app ($9.99 USD).

All of this is to say that the base functionality in Halftone 2 is well beyond the functionality of Halftone 1.

Speculation

User feedback has been so strong on this subject, that I added more content (balloons, stamps, layouts, and paper textures) to the base version in the first app update that was released earlier this week. Sadly, I’ve already heard that it isn’t enough.

My first reaction is to dismissively ignore the new feedback and conclude that—obviously—users want everything for free. Not only is that conclusion naïve…it’s dangerous too. “Educating” my users by trying to explain how much they’re really getting is also unproductive. I learned long ago that if you find yourself in a position where you have to educate your users to appreciate your perspective, you need to stand in their shoes and appreciate theirs. As they say, perception is reality, and the reality is that you need to accept their version of the world.

I’ve started to wonder if users perceive Halftone 2 as the free version plus all of the in-app purchases combined. And if they don’t purchase the full bundle, they somehow have less of an app than they believe they should have. Therefore, the app has limited functionality and “requires” purchases. Contrast that with my perspective, where I see a benefit to only purchasing the functionality that you need, and therein lies the rub.

Tire Kickers

The other burden of a freemium business model is that you’ll get a lot of tire kickers. These are people who otherwise have no interest in your app or what it does, but because it’s free, they’re more than willing to kick the tires. Unfortunately, because many weren’t looking to solve the problem that your app solves in the first place, it won’t solve a problem that they currently have, and by definition, it’s therefore useless. Most will delete the app and move on, but others will report how useless it is by leaving a poor review in the App Store. I’ve experienced bursts of negative reviews whenever I’ve run short “sales” of Halftone 1 (which can only become free, given its $0.99 USD price). Lesson? Even a small friction of $0.99 USD can keep the tire kickers at bay.

Also, if your app requires a lot of support, or if you have backend costs, free can quickly become too much of a good thing.

Promo Codes

Finally, there is the issue of promotional codes. Apple provides developers with 50 promo codes per app version, and they can be redeemed in iTunes or the App Store for a free copy. It’s common to send these codes to reviewers and news sites. However, there are no promo codes for in-app purchases. That means that while reviewers can download Halftone 2 at no cost, there is no way to review the additional items without paying. As you can imagine, this limits many promotional opportunities.

In the past, some developers have unlocked in-app purchases for specific devices by updating an authorized list of device IDs that is downloaded by the app. But, now that Apple prohibits apps from accessing the UDID, this method no longer works.

Reconsidering

All of this has caused me to reconsider my plans for Halftone 2. I don’t want to make a knee-jerk reaction and regret it later, but I also don’t want to continue disappointing my customers. At the moment, I feel like the freemium model is getting between my users and the app. I want to create products that my customers love, and it’s clear that a large majority of Halftone 2 users aren’t feeling the love.

I’ll be attending Apple’s WWDC event next week in San Francisco, and I plan to talk to fellow developers about their experiences with the freemium model. I’m also hoping that Apple will announce enhancements to the Volume Purchasing Program or improvements to the App Store itself.

I’d love to see support for trial modes or paid upgrades. While it’s unclear how paid upgrades can be implemented fairly, that’s no reason to ignore it. As for trial modes, I think that feature alone would eliminate most of my freemium angst. Finally, I’d love promo codes for in-app purchases, even if I have to pay for them myself.