Funding On-Demand Apps

Phil Wainewright writes:

Advertising is by far the least effective of the three. It’s probably a better option than selling perpetual licences for two bucks a time, but it will rarely produce enough income to fund operation and development of a service that offers real value to customers.

Subscription remains the most popular mechanism among vendors, mainly because it has the advantage of being simple to administer and easy to understand.

Transaction commissions are set to become the most important funding mechanism for online applications as time goes on.

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