Releasing Gradual Functionality With Updates For Maximum Profitability
The most profitable software is that which has an extraordinarily long life cycle. Take for example Windows, the most popular and profitable software program to date. Windows first became profitably ubiquitous with Windows 3.0, although years before this point in time, Microsoft had made profits through adding progressive updates to software based on Xerox and CP/M to provide software alternatives to IBM Dos and extended functionality even for now nearly forgotten brands such as the less-than-profitable Commodore Amiga.
Updates are the secret of their success. Windows 3.0 was quickly followed up by a profitable Windows 3.1 which added the support for audio. Microsoft added Windows95 as profit making graphical update having 32bit functionality to largely supplant and replace the 3.1 add on w32s.exe. Beyond that release, Microsoft profited from the release of an update Windows98 which had few significant values over 95 other than being bulkier and having smoother animations of components.
Nevertheless, a huge profit was made on the release. Microsoft is inarguably the king of software updates and profit. Many have tried to emulate their success but fallen short for a variety of reasons. Perhaps they lack such a robust and expansive product. However, more likely is that many software developers kill their profits by putting too many features in their initial release, giving them little if any significant leg room for profiting from subsequent updates.
Additionally, new comers tend to make the mistake of bundling free updates for live with the original purchase. Even if you sell fewer copies by refusing free updates, the repeat business for a quality software product through subsequent updates can result in profits which more than offset any initial losses to your profit line.
How to strike a balance between features and functionality is a problem plaguing the software life cycle of many common products. Essentially, a software project designed to produce the maximum revenue and profit should be designed to contain as few features as necessary to gain a reasonable foothold above and beyond the current competitors.
Even if your software is not quite-as-good as the reigning champion, a decent project that has a history of value-added updates at a reasonable price will eventually lure more sheep into the fold. Over the course of time, you can substantially increase profits through releasing updates. Updates should contain two major things. First and foremost, security and bug fixes.
Any potential serious bugs should be addressed in each new revision. Just the presence of “increased security” is enough to add more profits by releasing an update. Even if the actual update itself only consists of buffer overflow bugs that rarely occur, more than likely some buyers will be willing to update because they are the unlucky victims of the freak accident.
Secondly, value adding features necessitate updates. The bigger the scale of features added and tweaked, the more cause you have for releasing an update. Once you release the update, you will have some percentage of current users along with some new users contribute to your overall net profit.
By avoiding over-updating, you can release more updates thereby maximizing your profitability. However, it is important to note that while any change could justify an update, users will quickly catch on, even before paying for their first update, if there is little justification presented on your product website or mailer regarding the additional features and bug fixes.
Presenting each subsequent build sound like a substantial and solid investment is tantamount to maximizing profit through the release of updates. And by avoiding over-updates, you can help insure that you have a profitable long life cycle during which you can lure the optimal user base per release into giving you money and profits for your product without prematurely finalizing your software or vastly increasing development costs in the quest to make meaningful and profitable updates.
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