Paying Developers is A Bad Idea

The companies that make the most profit are those who build virtuous platform cycles. There are no proof points in history of virtuous platform cycles being created when the platform provider incents developers to target the platform by paying them.

Paying developers to target your platform is a sign of desperation. It means developers have no skin in the game. A platform where developers do not have skin in the game is artificially propped up and will not succeed as a virtuous platform.

The Windows Phone 7 team was in a very, very desperate situation. I was quoted in the NY Times (Jan, 7 2012):

Charlie Kindel…compared the pain caused by starting over to the predicament of Aron Ralston, the hiker who amputated his own arm in 2003 after it was it pinned under a boulder in the Utah desert.

“This boulder comprised of Apple and Blackberry rolled on our arm,” said Mr. Kindel, who left Microsoft last summer. “Microsoft sat there for three or four years struggling to get out.”

We were willing to do just about anything to get apps on to the platform. And we did just about anything.

Alec Saunders, who runs BlackBerry’s developer evangelism, understands this rule as well as anyone else on the planet. He & I worked together on Windows in the late ‘90s. I’m sure he knows paying developers to target BlackBerry 10 is a bad idea.  BlackBerry is that desperate. So he’s effectively paying $10K per app that gets written. Bad idea. But he has no choice.

I’ve discussed platforms here many times. The word platform is one of the most misused terms in our industry. Here is what I mean when I discuss platforms:

A Platform is a cohesive combination of technology and marketing that provides the means for a multi-sided market to operate in a virtuous cycle.

This, of course begs the question of what a virtuous platform cycle is:

A virtuous platform cycle exists in a multi-sided market when each side of the market both gives and receives positive value from the other sides.

So much positive value is exchanged, with low friction, that the cycle grows and grows, like a snowball rolling down hill.

The more sides to the market that exist, the more complex the system and the harder it is for the cycle to start. However, once started, a market with many sides will accelerate faster.

Examples of successful platforms we’ve seen and are currently seeing:

  • IBM System/360
  • Windows (big Windows, not Windows Mobile/Phone)
  • The iPhone
  • shopping
  • Google Search

In each of these cases, and other examples I’m sure you can come up with, there was a multi-sided market, and, at least for a while, a virtuous cycle existed because one vendor created a platform with the characteristics required to allow the sides of the market exchange value efficiently.

I think the example most people understand is Windows. The market sides were (are): Windows, Intel, OEMs (e.g. Compaq, DELL), IHVs (e.g. ATI, SoundBlaster), ISVs (e.g. Lotus, Adobe, Office), retailers & channel (e.g. Egghead), and of course, end users.

The ISVs of today are the app developers. For Windows to continue to be a platform that enables a virtuous cycle (and therefore to generate the historical profits it has in the past) there must be an efficient and natural exchange of value between app developers and the other sides of the market.

Apple accomplished this with the iPhone: It enabled app developers to very efficiently provide value to end users (one side of the market) and in return receive value from end users via payments and eyeballs. Apple provided value to developers (a marketplace). Developers provided value to Apple (non-native functionality). Because of luck, tactics, and great marketing, Apple ended up creating a virtuous platform cycle around the iPhone platform. And they didn’t have to pay for apps.

Those developers were motivated by other things to get started: The promise of an efficient marketplace, the chance to do something cool and different, and the promise of lots of users. They also weren’t really doing anything else. In 2007, before the AppStore, there was no other efficient market where they could participate and profit. Once they got started their investment in time and resources meant they had skin in the game. Thus they continued, and are less likely to move to other platforms.

Now, let’s talk about Windows 8. As of right now there are 2,000 apps in the Windows Store according to Win8Update. The goal Microsoft has for launch (in about a month) is ‘5 digits’.

Microsoft got those apps using the following tactics:

Microsoft Employee Moonlighting

Allow Microsoft employees to build apps in their spare time (we used this to great success with Windows Phone 7; I can’t tell you the percentage of early apps that were built by employees but it was more than you probably think).

Promise Windows 8 Will Do Very Well

This is actually a pretty easy sell. As Steve Ballmer was quoted as saying yesterday

“There will be customers coming and looking for apps. That I can assure you,” he said. “If 400 million PCs get sold in a year, at least two-thirds get sold in the Windows market. That’s 250 odd million, plus whatever we get in the consumer upgrades.”

Even if Windows 8 is a failure, it will sell hundreds of millions of copies in the next 12-24 months. Heck, there are already 16 million devices running the preview versions of Windows 8. “That’s more than the number of iPad 1s Apple sold!”

If it weren’t for already having resources tied up focusing on iOS (and to a lesser extent) Android, just about any sane developer would jump at this opportunity.

Talk About The Tools

Microsoft’s Visual Studio tools are really quite good, especially for building against Microsoft platforms. Developers who have built substantial apps for iOS using Xcode and then built for either Windows Phone 7 or Windows 8 with Visual Studio have told me they are more than twice as productive. You can find all sorts of articles like this as well.

The “sell” from a Microsoft evangelist to a (non-Microsoft employee) developer is thus:

“Don’t be late to the party. Within just a few months there will be 10s if not 100s of millions of people looking at the Windows 8 Store for something to buy. Yes, I know you are busy, but Visual Studio is so good that it will take you far less time than you expect to move your app to Win8.”

Will this be enough to get 10,000+ apps by October 26, 2012? I don’t think so.

Of course, the numbers of apps in the store is not the most important metric. What apps and their quality is far more important. But Windows 8 is going to struggle there too. Big brands and names are focused on iOS and Android; and are already reaching sufficient eyeballs today via those channels. The lure of future eyeballs on Windows 8 is not strong enough to cause them to shift budgets and move developers off of their iOS and Android projects.

So far, according to my sources, Steven Sinfosky who runs the Windows Division at Microsoft has steadfastly refused to pay for Windows 8 apps to be developed. I have not agreed with Steven on a lot of things, but on this point he’s got his principles right.

However, as I predicted last Spring, it is highly likely things are about to change and Microsoft is going to start directly incenting developers to build apps with cash. If I’m right, and we start to see clear evidence that Microsoft is paying for apps then Windows is in even more trouble than most of us already believe.

If I’m wrong, and Steve & Steven keep the checkbook in their pocket then my assertion is they have confidence in the long-term.

Time will tell.

Let me know your thoughts below.


  1. Jon Nehring says:

    As a developer, I think a couple reasons there aren’t a lot of apps yet is that many developers may not have the devices they need yet. I was a lot more excited to develop for WP7 after I got a Samsung Focus. Right now, I have to use Win8 on a desktop and can only simulate touch by using Splashtop with a (grudgingly purchased) iPad. Can I really test things like SQLite built for ARM without an ARM tablet?
    I’d also like to point out that Apple made a lot of apps available on the iPad simply by letting people run iPhone apps (gotta love that lame 2X mode!). Microsoft could do the same with the 100K+ WP7 apps out there. Yes, it would suck, but no more than Apple’s approach.

    1. NazmusLabs says:

      You can simulate touch on your desktop Windows 8 using Visual Studio 2012. There is a simulator that allows yout to simulate multi touch, swiping, pinch to zoom, and more. This tool is also available on the free, express, version of Visual Studio 2012. Set the debugger from local machine to simulator and simulate various screen resolution and multi-touch.

    2. JohnDoey says:

      Apple also had a simple way to add a full-size view to an iPhone app to turn it into an iPad app. So overnight, there were 100,000 iPad apps.

    3. kibbles says:

      the “lame” 2x mode was a simple slight of hand for launch day. after that native apps flooded its app store… i still occasionally use an iphone app (, but a 2x retina app looks right at home on an ipad.

  2. mdhughes says:

    The correct spelling is “Xcode”, not “XCode”. Details like that matter, it shows familiarity and respect, or lack thereof.

    The tools for Windows dev only exist on Windows. That’s a total non-starter for the top 25% of developers, and especially if you want iOS developers to switch, there’s no chance they’ll have or want a Windows machine. I would sooner gnaw my own arm off than install a virus-ridden Windows partition on my Mac, and I’m not atypical.

    Getting paid by Apple’s App Store is easy and they don’t cheat us. Getting paid by Microsoft’s store seems uncertain, I’ve heard zero success stories from the community. Either they’re very quiet about it or no money has been made.

    There are already hundreds of millions of iOS devices, and the users are proven to be willing to pay for software; some are cheapskates, but they’ll pay a buck. Even if in several years there were hundreds of millions of Windows 8 machines, there’s no evidence they’ll pay for software. Most of those are going to be corporate installations and not privately-owned machines, and Windows users are notorious as software thieves. Much too high risk.

    1. fluxman says:

      Great. A person who nitpicks about capitalization and correlates it to familiarity and respect shows his/her own ignorance (or lack of respect?) about Windows (virus-ridden?) and finally proceeds to slander Windows users as thieves.

      1. JohnDoey says:

        You have to understand — there are zero viruses on Apple platforms. I have not used Windows since 1998. There is no way I would ever use it because that means going from zero viruses to more than zero viruses.

        It used to be that Windows was sort of assumed, but in mobile development — as in graphics, video, music — Macs are assumed. Same as Web development. Since about 2006, 90% of high-end PC’s sold are Macs. Google is over 80% Mac. Facebook and Twitter are all Mac.

        Having to use Windows for development is an obstacle in mobile.

        1. gingerjet says:

          “there are zero viruses on Apple platforms”

          This shows an incredible ignorance of your platform. This year there have been at least two viruses that have hit Mac OS X in widespread situations. That doesn’t count the dozens of more limited malware that target Mac OS X. How many has Windows 7 received? About the same number. The security excuse just tells me you haven’t left the 90s. Its about time you grow up and introduce yourself to the new century.

          1. darkcrayon says:

            You’re saying “Windows 7” has “received” the same amount of malware as Mac OS X? There’s no way you can mean numbers of different malware… Windows anti-virus software definitions need updating every day just to keep up. Perhaps the flashback trojan reached a very high percentage of Macs, but a one time disaster doesn’t quite equal the decades of (still ongoing) Windows malware attacks.

          2. JadedConsumer says:

            Not every malware is a virus. The Mac malware you noted is (a) incapable of running on iOS, and (b) dependent on users to run the app and authenticate as administrators. You can get users to do this, but not in enormous numbers and not with the vector speed of a functioning virus.

          3. Do. Not. Feed. The. Troll.

          4. kibbles says:

            sorry but it’s a fact. please link us to viruses on the OS X platform. not Trojans or malware, but viruses. Win has plenty.

          5. kibbles says:

            actually it’s you showing the ignorance — Mac OS X has
            never had a virus in the wild. ever. what you’re referring to were malware.

            words matter.

        2. kibbles says:

          as a professional enterprise .NET developer who owns 3 macs, i hear you, but it’s pretty painless to set up a VM in VMWare and configure snapshots on it. i dont know how id get a virus (never bought into AV software in my Windows days) but if I did I could roll back.

      2. The point is: are you (and by extension MS and Windows) interested in learning from Apple’s success or not?

        Part of Apple’s success comes, indeed, from obsessing over things like capitalization. That’s what makes people feel, without being able to articulate the details, that the platform is predictable, elegant, beautiful, professional, delightful, all that.
        Apple has users who notice (and complain) that the spinning control shown when the iPhone is shut down was not rerasterized for a retina display — and Apple responded by creating a retina enabled version. Meanwhile you can still get dialogs appearing in Windows 8 that look like they are refugees from Windows 3.

        Of course Apple isn’t perfect, and even in this space of attention to details they make mistakes with every release. But their response to these types of mistakes (and we are specifically talking here about attention to detail, visual appearance and suchlike) is to fix them in the next release, not to berate the person who noticed them as an obsessive idiot.

        1. fluxman says:

          Yeah, Apple’s attention to detail was really apparent with its new Maps.

          1. Player_16 says:

            Reread the last paragraph; the part about ‘next’ would give you a clue.

          2. Douglas says:

            I think you forgot to add “nyah nyah”.

          3. Idon't Know says:

            The Maps issue is overblown and will settle down. It already has for most users. Also it will get better.

    2. Jeff Kibuule says:

      I developed my Windows Phone 7 app in Parallels. No need for a new machine, just use a virtual machine.

    3. briandela says:

      So, the top 25% of developers simply won’t use Windows. That’s a sign of complete and utter bullshit arrogance.

      1. Adam MacBeth says:

        No, it’s not. That specific number is clearly pulled out of nowhere, but the sentiment is spot-on – the best developers HAVE gone elsewhere. Microsoft has alienated many developers and will need to work very hard to get critical mass on Win8 and WP8. If they can’t be honest about this they will probably start throwing money at the problem.

        While Visual Studio is great, the release process, lack of new hardware, and general development on a Windows machine is crap (Unix tools please?). Developers don’t have time to wade through this crap unless the payoff is great – which remains to be seen for all the new MSFT platforms.

        1. Dave says:

          I resemble this remark. I have been using .NET and C# since they were previewed to me at Redmond in 2000. (back when C# files had the extension “.cool”) Before that, I was a VB then Classic ASP veteran for 5 years. I was a huge proponent of the platform and tools and sold several clients on it over the years.

          In the past two years, our development has shifted to 90% Rails on Mac + Linux. Why? Because we don’t have to fight the tools. We were spending so many hours working on configuration of both dev and production machines, we just had enough. We were “locked in” to the toolset and the framework too, whereas with Rails (or Sinatra, or node or whatever) we can use what we want. (now I just use a simple text editor + command line – the difference is like going from a lifejacket to a speedo.) The rails community is far better organized via github, so libraries are easy to find, extend, use, and get help with. No offense to anyone, but going into most MS communities is like walking into a hall of mirrors and asking a bunch of third graders to help you change a tire.

          That said, we were excited about the new tool sets from MS anyway and gave them a try. It was then that we realized that compiled code really doesn’t fit what we need to do anymore.

          In the time it takes to build, compile, and start up a large web app in .NET, I can do 5-6 test cycles with Rails + RSpec. If a test cycle in .NET costs 45 seconds and a test cycle in Rails costs 6 seconds, then over the course of 10,000 test cycles that’s 125 hours spent vs. 17 hours spent waiting on the tools. It just not economical. (I’m not making those numbers up either – those are from real tests we ran on real projects.)

          (Before you go off about performance or security, those are covered still, just in different ways. We do that sort of thing on the deployment of the code, not during the development of the code.)

          Once upon a time, Steve ran around a stage screaming “developers, developers, developers.” And it was great, and spot on. I think they need to reread that storybook again, and figure out how to take a lot of what they’ve done and just start over again. Until then, Windows 7 might be the last Windows OS I ever buy.

          1. JohnDoey says:

            The same is true in mobile. Developers have joined creatives on the Mac platform during the 21st century. Partly it is because apps now have animation, audio video, design features. Partly it is because developers need to be on the cutting edge so that the app they build today is used by consumers over the next couple of years, and Windows stood still for a decade.

          2. My story is about the same and I worked as a PM on VS at Microsoft for years! It’s a great tool but as you say it’s just overkill and Windows is exhausting. I love my Mac and the general reduction in computer stress. I don’t want to say I’d never go back to Windows but it’d take some proven successes and I’m certainly not willing to suffer using Windows on some kind of speculative market play.

            There are enough amazing opportunities to pursue enjoyably and win through the cunning of my team rather than suffer and rely on land grabs that any flashlight app moron could make a few dollars on.

      2. JohnDoey says:

        Almost nobody in Silicon Valley uses Windows.

        Facebook, Twitter, Google, and of course Apple — all Macs. The top 25% of mobile developers may be at those companies alone. Then consider almost 5 years of App Store representing 80% of mobile app sales, all those apps made on Macs — engineers all long since went to Mac OS X. The Intel Mac has 90% market share in high-end PC’s. Average Windows system is $400, a basic terminal.

        The world has changed around you.

      3. Are you denying the truth of the statement?
        Because if you are not, then your opinions about these developers are irrelevant. The world is what it is, and MS can adapt to it, or can be rendered irrelevant.

        One confirmation of the statement, for example, is to ask how many people at the top web development firms (eg Google, Amazon, eBay, companies like that, which are neutral as to OS) use Macs rather than Windows? And how many would be willing to switch machines?

        I do know that at Google, for example, people can get either Macs or WIndows machines, and my understanding is that substantially more than 25% of the machines are Macs. One could ask similar questions of people doing leading edge work in languages, or in graphics, or in AI; and I suspect in all three cases (judging from the machines one sees at conferences) Macs would be a majority.

        1. JadedConsumer says:

          At Google, they can also use Linux and in greatly disproportionate numbers (with comparison to the rest of North America) they do. Their Mac percentage may be nontrivial, but I hear Linux rules the roost.

    4. “The tools for Windows dev only exist on Windows. That’s a total non-starter for the top 25% of developers, and especially if you want iOS developers to switch, there’s no chance they’ll have or want a Windows machine.”

      The last time I checked, every iOS developer has to have a Mac to develop with Xcode. And all Intel-based Macs, either by virtualization software or Bootcamp, can run Windows OS. So iOS developers won’t have to go out and buy new machines to do Windows development. They can do it right on their Macs. That’s why I see more and more developers using Macs.

  3. Jeff Kibuule says:

    I think it depends on whether Microsoft is paying developers for “all” apps or just key ones that they know must be on the platform. I mean, certain apps must be there on day one. Facebook, Netflix, and Twitter are just a few. And they can’t just be crappy afterthoughts like the Facebook app for Android has been. They have to be well done native apps that showcase the power of the platform. I feel like this is the one thing that Google has NEVER done, as such there may be lots of apps on Android, but none of them have a design that feels like it belongs on the platform.

  4. MarcSilverTriple says:

    Perhaps one of the reason Microsoft didn’t provided any pricing information for Surface… In other words, based on the principles that paying a developer is a bad idea, It might be more interesting to make Surface very attractive in terms of price to generate the interest of the developers… And this kind of position would be very difficult to go for, because it doesn’t sound good for Microsoft OEMs. But somehow, they might not have the choice…

    1. Surface is irrelevant. Microsoft will sell MAYBE 3M Surface devices in the next 12 months. Maybe. They are likely to sell 100M+ copies of Win8 via OEMs in that same period. Do the math.

      1. MarcSilverTriple says:

        Well, by itself, WinRT looks irrelevant : what it the expected breakdown of WinRT vs Windows 8?

        1. That’s a great point. I haven’t seen any projections, but I bet it’s no more than 20% in 12 months.

          1. MarcSilverTriple says:

            Well. If it goes beyond 10% I would be surprised. The average joe going for a hybrid Windows 8 tablet will go for it simply because it runs legacy application he is using and that would be an obvious choice.
            Now, what would be the reasons to choose WinRT? There is some tradeoff : no legacy application, only Met…ModernUI application (a few), Office integrated but with some limitations, an extended autonomy (and this might not be true for long anymore)… As a consumer, I’m not really seeing the interest of WinRT… So market share wise, I do assume it is going to be irrelevant versus Windows 8, unless there is a valid reason for it. I’m now interested at the why WinRT.
            If we look at the past, they (you included) have struggled to build Windows Phone 7 ecosystem. It took almost 2 years for Microsoft starting from scratch to get in situation to have Windows Phone 8 credible in terms of platform…
            I do think that a company is learning from its past mistakes. I do think that Windows Phone 7 was there to get the path ready for Windows Phone 8, rather than being successful as platform.
            Now, looking at the tandem WinRT/Windows 8, I do assume Windows 8/WinRT is a transition OS, its ultimate goal is to prepare the future. The future is made of Metro, and it takes times*money to build an ecosystem. You can not make it from day one, unless you are the first one to make it (aka Apple iPad). The duality between WinRT/Windows 8 would allow to attract developers by the “write once, run all” approach. A metro app developped for RT should be ported easily to Windows 8 and vice versa… Windows 8 will sell easily, just because of the legacy app. This is the mass that attract the developers. WinRT is here to prepare the future. No matter the market share it will gain, it is to open the future. Windows next gen will be ready for a full metro/modernUI, thanks to Windows 8/WinRT duality.
            So, my guess on the why : to build the ecosystem to get ready for next gen…

          2. MySchizoBuddy says:

            “I do think that Windows Phone 7 was there to get the path ready for Windows Phone 8, rather than being successful as platform.”

            Only if they said that when Win 7 was launched. It was launched to be the iOS killer from day one NOT a stepping stone for Windows 8. it’s easy to forget actual history and make new one.

          3. MarcSilverTriple says:

            If you say something is here to prepare the path of the next generation when starting selling it, you build yourself a disaster, and both current and next gen are dead out of the box. No one would buy. They could not simply state that, it would have been even worse that what it is.

      2. How many of those 100+M copies of Win8 will go towards machines that have 3rd parties apps sold to them?

        The Win8 that goes into enterprises, labs, doctor’s offices, is essentially irrelevant to the type of App Store market we are discussing; what matters is Win8 sales
        – to individuals
        – who care about buying PC software.

        For THESE types of buyers, Surface may well be a dominant player.

        And simply quoting how well Windows8 will sell, based on sheer dreams, in the face of such hostility to it, is a dangerous game. Compare with Ultrabooks. Ultrabooks were actually WELCOMED as a concept — but so far at least have sold substantially below projections, presumably because of lousy implementation. Windows8 would appear to be suffering under essentially the same burdens (lousy hardware with penny-pinching cost-cutting in various places which destroys user’s delight at the product) PLUS the burden of an OS that is widely reviled.

  5. Brian Moran says:

    *IF* a developer is going to be paid, it’s a totally different relationship than being an “ISV” (maybe a ‘dependent’ software vendor?); the developer will expect to be ‘managed’, and they’d better be!

  6. Anon says:

    Microsoft is definitely paying developers to provide apps – we were offered a flat $10k

    1. I don’t believe you.

      Email me at charlie @ with details. Otherwise you are just an anonymous troll.

  7. For me, at least with WP8, is that their official SDK isn’t out yet. It’s been previewed and leaked, but just last week they barely started doing early dev SDK preview. I requested to be in it, but apparently my app had too few downloads (500+), I assume. With only so little time left until launch, I’m going to feel rushed. I wanted to build from mobile up to the W8 store. As just an individual dev, I just want to push new apps in W8 – instead of just updating current apps – and need not to worry about payment until launch and future.

  8. I hold no brief to defend anyone but saying it’s $10k per app is utter misrepresentation – it’s $9k max per app that earns >$1k>$9,999. Based on what you know of Windows Phone you can guestimate the proportion better than me but calling it all? That seems a lazy way of looking at it.

    1. HI Mary, Not sure what you are responding to here.

    2. JohnDoey says:

      $9K or $10K makes no difference.

  9. SoupAndNuts says:

    ” Apple provided value…” your forgot the most important one, “…consumers”. They bought the hardware from Apple for numerous reason, the qty/quality of non Apple apps was a tiny factor in peoples decisions to buy and iPhone. This is where MS might do okay with their own tablet, but the rest (phone/desktop) is still a mish mash of other companies products with some MS stuff inside that only friends/family/devs of the MS stack care about. Rinse and Repeat, I heard the same story with WP7, shame MS didn’t listen this time around and ditch the windows brand entirely and own soup to nuts as a entirely new and separate company.

  10. starvingcoder says:

    from where I sit, situations like the iPhone are just exploiting programmers/engineers with a lottery-like mentality

    1. JohnDoey says:

      That is pure sour grapes. No basis in fact. Apple developers make voluntary decisions to learn Objective-C and buy Macs and create digital consumer products and sell them in App Store.

    2. Idon't Know says:

      What a silly thing to say. I would love to be exploited like that! Throw me in that briar patch! Heh.

  11. ggruber66 says:

    I will concur that guaranteeing revenue for developers as RIM has done is dead stupid, as have many other decisions they have made recently (my favorite is still launching the Playbook w/o native email support).

    But I’ve heard that MSFT was ‘supporting’ the development of apps for WP7 (talk of cash to subsidize a portion of development costs) and providing resources (free tools, marketing, development support resources) has always been part of the MSFT platform development playbook.

    1. As I said, the WP7 effort was so desperate we would do almost anything. We did. Not sure if the team still is though; but wouldn’t surprise me.

      1. fluxman says:

        Nokia has been able to bring a selection of new apps to the WP7 market, many with some initial timed exclusivity to Lumia phones. I’ll be surprised if they would have been able to secure the exclusivity period without any form of incentive to the developer/company. Was that a sign of desperation on Nokia’s part? Probably. Was it necessary? I think so.

        That actually showed that Nokia, unlike the other OEMs, had skin in the WP7 game. Others were just putting out phones like PC OEMs are churning out computers. But WP was not a field of dreams, where Microsoft and OEMs can just afford to sit back and relax after bringing the platform to market, waiting for licensing fees and hardware profits to gush in with users and developers.

        For there to be a virtuous platform cycle for WP, it has to get started. It doesn’t have Apple’s and Google’s user base. I’m sure the story would have been different had WP7 launched much earlier.

        As for Windows Store apps, I’m not sure if the promise of a large Windows 8 user base would be enough to start that cycle, at least initially, if Windows RT devices don’t sell well. Why would developers spend resources on Windows Store apps/games when that would break compatibility with the huge Windows 7 install base? Why would companies like banks, stores, airlines spend resources on creating touch-friendly app version of their websites (which most tablet apps are) for the Windows Store… when previously their website was enough to serve the Windows audience? Now they have to create a stand-alone app for them as well?

        1. Windows Phone is not a platform (by my defn.). It is a component (a very weak, beleaguered component) of the larger Windows platform.

          1. Horace Dediu says:

            This is most interesting. I had not thought of it this way before.

        2. Sasparilla2 says:

          The other thing to consider with Nokia – they made their own software for their phones, so this was quite normal for them (leveraging that advantage).

  12. Walt French says:

    @CEK wrote, “If…Steve & Steven keep the checkbook in their pocket then my assertion is they have confidence in the long-term.”

    I suppose, but they seem to have had a LOT of confidence in their ability to create a platform over each one of the past 5 years, to essentially miserable results as you document above.

    I mean, you have a market where the leader has become the biggest company on the planet by pouring billions into a solid, multi-faceted platform, while Microsoft wasted billions with niche hobbies such as Kin and XBox, which were never likely to be gateways for the mass market that Microsoft used to be so good at serving.

    And these are the same decision-makers whose “confidence” in themselves will determine the outcome for Windows Phone?

    Maybe you’re only talking about their confidence level, their self-assessment skills. But if you’re actually talking about how well they are putting together the infrastructure for the multi-faceted platform, can we get a second opinion?

    1. Why did you make this about Windows Phone?

      1. Walt French says:

        My bad; I’ll leave the reference to “Windows Phone” so your reply makes sense.

        But I think it applies just as well to the “Modern” Win8 user experience that Microsoft is positioning as lying on the same continuum with Legacy Windows, and which many developers will attempt to share some apps’ code, marketing, etc., with.

        I completely accept your point about the importance of a total platform, so my question is whether you think the Steve/Steven duo actually are putting the pieces together. To my more distant eyes, it seems they’re ceding the development of new platform facets to other firms.

        1. In all honesty, I don’t know. I see some positive signs (Skydrive, OneNote, x-device). I see other idiotic behavior (e.g. the arbitrary platform differences between WP7 & Win8).

  13. What about the iFund?

  14. r00fus says:

    This is not entirely factual about Apple not paying devs. They and Kleiner-Perkins created the iFund that effectively bankrolled dozens of app startups. Of course, the idea was far more nuanced than Microsoft or RIM’s approach of handing cash to the devs. The idea instead was to invest in those companies and let them forge their own success (ie, Flipboard, Path, etc). Also the investment vehicle probably didn’t cost Apple much as it delivered because it brought in outside investing partners into the fund.

    1. Creating an investment fund, in partnership with a VC, long after the platform had taken off is not the same thing as paying devs, by any stretch of the imagination.

  15. Mel Gross says:

    Well, so far the apps in the store are considered to mostly be second rate. I’m not sure what that means yet, but that parallels the apps in the Win Phone store, most of which aren’t considered to be useful or very good.

    Microsoft is confusing things though with RT, Win 8, Win Phone, etc. all proporting to be the same, but not the same. I just wonder how consumers will understand it. And it’s the chicken and the egg, isn’t it? Apple was smart. When the iPhone first came out, it had all it needed to be useful. When apps came out the next year, there were already 13 million phone owners hungry for apps. They fed upon one another. When the iPad came out, there were hundreds of thousands of apps that would work, even if they didn’t all look great. There were apps! It was easy to upgrade many apps for the larger screen.

    Will that happen here?

    1. pihlen says:

      I agree with many of your points, but where did you find that sales number for the first iPhone? According to Steve Jobs WWDC keynote in 2008, Apple sold 6 million iPhones the first year.

      Link to mentioning in the keynote:

  16. JohnDoey says:

    I think 3rd party software is irrelevant — Microsoft Office does not exist for Metro yet. That is like if the first iPhone did not have iPod+iTunes functionality.

    6 million people bought iPhone before App Store was even announced, becsuse out of the box you already got a complete iPhone. A Metro tablet needs to do that also. By now, heading for 6 years since the iPhone introduction, how can it be that there is no Metro Office?

    Right now, Microsodt I losing te low-end PC market to iPad. Not because of widgets like Instagram but because of full-fledged native C/C++ PC apps like iMovie, Avid, Keynote. Even on ARM, Microsoft had to bring a full PC class device.

    Also — Windows 8 should run Android apps. What did they use their Android patent licensing money for?

    So too little, too late.

    1. GeorgeS says:

      “Also — Windows 8 should run Android apps.”

      Google won’t let them use Google’s own store. Like RIM, they’d have to create their own. Only OEMs who license Android from Google can give their devices access to Google’s store.

      1. MySchizoBuddy says:

        plus why would you want that anyway. Is there a shortage of devices that can run Android Apps. Android apps will look completely alien under WinRT. They will ruin the platform rather than enhance it.

    2. kiran bhanushali says:

      There was no benchmark set by any other mobile OS/platform before iOS and android came around. windows mobile 6.5 had apps but their marketing wasn’t centered around this fact.

      The base expectation that has been set in the minds of users by apple and android is there should be 10s of 100s of thousands of apps for a platform can be adopted. That’s been the key differentiator for those platforms. So windows phone needs apps in addition to something else (most likely xbox integration and overall integration with other devices and services) to be a valuable enough proposition for buyers.

  17. Defendor says:

    “Even if Windows 8 is a failure, it will sell hundreds of millions of copies in the next 12-24 months. Heck, there are already 16 million devices running the preview versions of Windows 8. “That’s more than the number of iPad 1s Apple sold!””

    There is giant fly in that ointment.

    How many people are going to actually be using/wanting/caring about Metro/Win8 Style apps (or whatever they are called this week) on what for the most part will be dekstop machines?

    I am Windows user since 3.1, but I have no interest in Metro apps on my desktop.

    Microsoft will succeed in inflating the number by including Metro with each copy of Desktop Windows, but it remains to be seen what that actually translates into for real Metro usage numbers.

  18. Who have told you that MS is not paying for apps? They do! They create scam based contest, in “create 5 apps and get phone* (*until we run out of stock, but we won’t tell you how many phones we have, ok fine, three)” style (described here, after the shameless self-link:

    If you dig into RIM’s T&C you will find that to get 9K$ you have to sell at least 100 copies of your app and gather 1K$ from the market. I suspect that they have weighted this 10K$ action well, and they exactly know which apps sell well and what is the buzz starting volume.

    1. mjw149 says:

      Seeding the market with newcomers is normal and broadly done.

      Paying established developers to port apps is desperate and doesn’t work well, because the apps are sometime poorly done and always neglected.

      In this scenario, Machiavelli’s advice on mercenaries vs a militia applies. You can’t trust mercenaries and they always want more money, it’s a desperation act to employ them. Citizen militias will be far cheaper and better motivated. Same thing here.

  19. Guest says:

    ISVs who accept payment become DSVs. A platform doesn’t surive on those.

  20. mikesax says:

    ISVs who accept payment become DSVs. A platform doesn’t survive on those.

  21. yetanothersteve says:

    There’s a problem with the number of users argument. Android has far more users than iOS. And yet far dramatically fewer revenues flowing to developers.

    Just as Apple proved an app store can really channel revenue to app makers (though it’s a “hits” business), Google Play has proven that it’s not as easy as it looks.

    And here’s the dirty little secret: Apple’s control freak nature is why it’s app store succeeds. Apple works tirelessly to keep the jailbreakers scrambling. And most Apple users don’t jailbreak. Don’t be fooled by the “cool apps” you can do that Apple won’t allow. People who want that buy Android. The appeal of jailbreaking is pirating software. Apple has created a mass market platform where the vast majority of users don’t pirate.

    I think MS wants to create a similar ecosystem. But with the hybrid nature of W8, we don’t have any idea how many of those 100s of millions of users are really “platform-formally-known-as-Metro” users. And to what extent those users are willing to pay a few bucks for software the way iOS users are.

    1. Jason Yeaman says:

      iOS runs on iPhones, iPads, iPod touches and Apple TVs. Globally and across all hardware platforms, iOS users outweigh Android users by 116%. in Europe (a somewhat dated com score report) and 58% globally…when using metrics based on web impressions from ANY iOS and ANY android media connected device.

      apple currently holds 43% of US smartphone as of this day.

      The rest of your post was spot on.

  22. Iain Dawson says:

    Every video game console launch in recent history has involved the console manufacturer offering at least a little, sometimes a large incentive for third parties to provide launch titles. There is absolutely precedent for success in this approach.

    1. First, I was very careful to make sure I was talking about “successful” platforms.

      Second, I am talking about virtuous platforms.

      Third, Xbox didn’t.

      1. Iain Dawson says:

        …which, of course, depends how you define success. The Xbox 360 has succeeded in many ways. While it has not achieved truly mass-market, iPod- or even Wii-like ubiquity, it has taken a significant chunk — a majority, even — of the (shudder) *Core Gamer* market. In this way, it is a success. And I’m not just talking about the Xbox, anyway.

        I may be missing something, but I don’t see how the ever-increasing userbase and game catalog (and the ever-lowering cost of entry) during a console’s lifespan is anything but a virtuous cycle. Developers have a bigger and bigger target audience and consumers have a bigger potential library of games. All the while, the platform vendor ships updates that enable new uses for the device itself (PS Move, Kinect, Netflix, what have you).

        I’m unable to find any verification that the Xbox launched with or without traditional third-party incentives, but it’s kind of irrelevant. For one, it’s certainly true of other successful game platforms. Secondly, both the 360 and original Xbox launched with titles paid for directly by Microsoft, and every first- or second-party launch title falls under the banner of ‘additional software paid for by the platform owner’. The same risks and signals apply — they’re spending an amount of money in the hopes that the developer will make something that attracts consumers to the platform which, in turn, will attract more developers. And consumers.

        Developer incentives on a platform that has already peaked are suspicious and desperate. Developer incentives on a platform the vendor is confident in but that has yet to prove itself is a legitimate strategy. The iPhone didn’t need incentives because Apple had nothing to prove to developers — everyone was already fully aware of the success of that platform by the time the SDK was released.

  23. There is a synergy that your article missed. For app developers to write apps there must be a large enough customer base. One of the key things that will draw customers is apps! One of the reasons the iPhone took off was that it had enough included apps that people could use on day one. Apple invested (paid developers) in creating those initial apps.

    1. You seem to forget that the 2007 launch of iPhone didn’t include an app platform or marketplace AT ALL.

      Apple may have had a financial agreement with Google for the initial built-in mapping and Youtube apps, but that is not the same thing.

      Apple never paid developers to build apps.

      1. Alex Zaharov-Reutt says:

        Not sure if that’s entirely, strictly true, Charlie – Apple was quick off the mark to promote “Web Apps” – basically glorified mobile sites that you could add to the home screen as an icon.

        So, even though there was no app store as yet, Apple sure was promoting web apps at its site (I remember perusing through the various third-party web app examples Apple was offering, perhaps the Internet Archive “way back machine” still records this page).

        Apple was urging developers to create those web apps thick and fast given the disappointment over there being no “official” third party apps as yet.

        Web apps aren’t native apps, but they were apps of a type, so let’s at least acknowledge that.

        It wasn’t the native app store everybody wanted, but it was indeed possible to get “native” apps prior to the official App Store, and that was by jailbreaking your iPhone, although the truly serious third-party apps didn’t arrive until the App Store, that’s for sure.

    2. kiran bhanushali says:

      Good point. Keep in mind though that when the iphone was first released it was head and shoulders above the other “competing” products of the time. So out of the box experience even without third party apps was multiple times better than other devices so Apple built out the user base on the strengths of the device itself. Now they have another differentiating factor with the 500k apps available.

  24. brokenEstring says:

    If you are not already developing for the 1 billion existing Windows desktops then why would 16 million more running Windows 8 make a difference?

    1. There is no marketplace for apps on Windows today. As a developer you have no efficient way of reaching those 1B users. The Store in Win8 changes that (moving forward).

      1. mjw149 says:

        More efficient than Steam?

        Most apps are games on every platform. No one is going to add their credit card to the windows store for a free weather app or for a more annoying way to watch netflix videos on their PC.

        Windows tablet users will be different of course, having no other choice for native touch apps, but how many of those will be sold, and how many will be sold to purchase-ready consumers? If MS succeeds, they’ll succeed in the enterprise and their OS is curiously positioned not to capitalize on that – Surface will sell too few to profit directly and the store can be ignored by enterprises and their cloud is too weak compared to Google/Amazon (to the degree that matters in the enterprise).

        And then they have no 7″ offering for reading/children’s games. It’s a puzzling thing that their platform is so convoluted yet still doesn’t address certain sweet spots.

      2. kiran bhanushali says:

        Already is a better way to reach the userbase by building out a web based app for firefox or chrome. Windows desktop local apps have been skipped

  25. johnstwart says:

    I think there’s a difference between smartphone and tablet consumer market.
    Microsoft did not do well with Windows Phone not only because of the lack of apps.
    They had to pay developers not necessarily because Windows Phone was bad or because of the tooling. Microsoft has very good dev tools.
    There were some important OS features lacking as well.

    Microsoft had everything except vision to make the a Windows Phone years sooner than 2010 and much better than the first versions of the iPhoneiOS.

    I think they have a chance with tablet.
    Tablet business will grow very big in the next 5 years and Microsoft will be a big player. They are not very late at this party, yet.

  26. Is “to incent” a neologism for “to give an incentive”?

  27. Kotfu says:

    Great piece, but there is at least one virtuous platform cycle started by the platform provider paying developers to use the platform, and it was Microsoft’s platform. Shortly after acquiring the rights to SQL Server from Sybase, Microsoft started recruiting, and paying, ISV’s to port and write applications using their new database. SQL Server developers still had skin in the game, and the SQL Server platform certainly has been a long term success.

  28. grs_dev says:

    The real question Mr. Kidndel should be whether Microsoft Office 2013 will become what Halo turned out to be for the Xbox.

    Microsoft has precedence here, and yes it comes from Microsoft’s experience with the Xbox. Even though the gaming platform lost $1 Billion in each of its first 5 years (allegedly) the strategy paid off in the long run. But losing a billion could not have generated the necessary outcome had Microsoft not invested into Bungie. Halo may not have made the Xbox the success that it became on its own but one could argue that without Halo the Xbox story would have been a lot tougher to tell.

    SImilar to how Xbox represented a new business model for Microsoft, Windows 8 is a new paradigm shift on the business front more so than it is on the technology one. Sure the user experience is changing dramaticlaly, but the business shift is moving to a place where there are no clearly drawn lines.

    To put matters in perspective, this is the first software product at scale that will alter the end user’s perspective of how apps are bought, owned, and used. I know that iOS has been doing this at scale but we’re talking about apps that have productivity and mission critical expectations riding on them. No offense to iOS users who use their products for mission critical functions.

    I see nothing wrong with a strategy that pays to prime the pipeline. The paying for quality apps practice should be measured and measured closely. If the percentage of apps subsidized by Microsoft is not dropping geometrically each year, then someone somewhere will adjust. The company isn’t necessarily betting the farm on Windows 8 per se. Microsoft is a company trying to establish and assert its dominance and leadership in a crowded market. If Windows 8 doesn’t do that, there will be Windows 9…

  29. grs_dev says:

    Windows 8 will drive up the Windows 7 adoption. Windows Server 2012 will drive up the adoption of Windows Server 2008 R2. It’s a win-win.

  30. Jonas el Enterado says:

    Guys; you are missing a thing: Microsoft will have more fragmentation that they think because they are handling with 3 different devices: Phone and the 2-in-1 Surface tablet. Even if Microsoft will sell 10-20 million Surface devices, there is one constant on it. Surface is a tinny (top of the line in terms of size even compared with ultrabook’s) PC with Metro style for “Tablet use”, but it’s still a PC! so, it’s a Small PC with small screen for the PC environment and it will have some difficulties to find a profitable ecosystem for users/developers …

  31. NetscapePizza says:

    What about when do it…

    1. It is a sign that the core business, the fundamentals, are not solid. Ideally, a platform will provide sufficient built-in value exchange such that developers are self-incented to get on board.
      I’ve heard all kinds of rationalizations about why it’s good that ADN (or others do this). “You need to boostrap”, “This is really about ensuring quality”, “It’s not a lot of money”. In the end, the simple fact remains: A strong, virtuous platform cycle, requires that each side of the market have a NATURAL value exchange. Paying developers to get them on board is artificial and sets a bad precedent. It means the developers are not naturally incented to target the platform.
      Consider this: If ADN had a strong natural value proposition for developers it would not need to pay them to get started, right? Those developers that do ‘take the offer’ are really only doing it because of the offer, not because they really believe in ADN long term. If they believed in the long term, they would do it without the need for payment.

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