Not all "free" software is actually free - you're often paying with your data, privacy, or through deceptive subscription traps. In this episode, Jordan Bravo and Stephen DeLorme break down the business models behind the software you use daily, from ethical freemium approaches like Tailscale to exploitative data harvesting like Gmail. They explore managed hosting models, the pros and cons of subscriptions versus one-time payments, and expose dark patterns that trick users into unwanted charges. Plus updates on Jordan's private SIM card journey and news about Google's forced Android changes and Linux desktop growth.

Chapters

• 00:00 Jordan's Opening Quote on Data-Subsidized Software
• 00:38 Introduction and ATL BitLab Sponsorship
• 01:56 Welcome and Contact Information
• 02:22 Jordan's Private SIM Card Update
• 02:48 The "Pick Two" Dilemma: Private, Fast, Convenient
• 03:17 Mint Mobile: Private and Fast but Inconvenient
• 04:03 AT&T Prepaid: Convenient but Extremely Slow (3 vs 913 Mbps)
• 05:09 US Mobile Blocks Anonymous Payment Methods
• 05:50 News: Google Forced to Open Android in Epic Games Victory
• 07:51 Court Orders Google to Stop Monopolistic Practices
• 08:55 Implications for Alternative App Stores
• 10:29 News: Linux Desktop Market Share Hits 6%
• 11:26 Steam Deck and Gaming Driving Adoption
• 12:44 Steam's Proton Compatibility Layer
• 14:07 Privacy-Focused Users and Celebrity Endorsements
• 16:49 AI/ML Workloads Favor Linux
• 17:57 Main Topic: Software Business Models
• 18:42 Why Business Models Matter for Users
• 19:33 Paying for Good Software vs "Free" Alternatives
• 20:17 Unethical Model: Data-Subsidized "Free" Software
• 20:43 Gmail Example: How "Free" Services Really Work
• 22:58 Ethical Model: Tailscale's Enterprise Freemium Approach
• 25:12 Pure Freemium vs Data Collection Hybrid
• 26:47 When Freemium Goes Wrong
• 27:17 Managed Hosting: Element and Nextcloud Examples
• 29:10 One-Time Payment vs Subscription Models
• 29:46 Adobe's Transition to Creative Cloud
• 31:07 Accessibility vs Long-Term Value Trade-offs
• 33:21 The Rise of Overpriced SaaS Tools
• 36:39 Importance of Transparent Pricing Models
• 38:22 Dark Patterns and Deceptive Practices
• 39:10 Jordan's Examples of Subscription Traps
• 40:00 Stephen's ClassPass Cancellation Nightmare
• 43:09 Multiple Deceptive Pattern Types Identified
• 44:44 Hall of Shame: Major Companies Using Dark Patterns
• 46:04 Conclusion: Choosing Ethical Software Business Models

Links

• Jordan Bravo
• Stephen DeLorme
• Boost in on Fountain.FM
• Epic Games vs. Google Court Decision
• Linux Desktop Market Share Statistics
• Deceptive Patterns Types and Examples
• How I Broke Up With Adobe
• PewDiePie's "I Installed Linux (so should you)

Transcript

Sovereign Computing: Software Business Models Deep Dive

Jordan Bravo: [00:00:00] First one is going to be so-called free software- free, as in you don't pay, but that they pay for with selling your data. The typical examples of this would be Gmail.

You don't actually pay for Gmail with money outta your pocket, at least most people don't on the typical plan. And so how are they paying for those servers and those developers and the infrastructure and their whole company? Well, of course they are using your data for various purposes. They're able to train AI models. They're able to create targeted ads and build up huge databases on users that they're able to sell to advertisers for targeted ads.

Welcome to the Sovereign Computing Show, presented by ATL BitLab. I'm Jordan Bravo, and this is a podcast where we teach you how to take back control of your devices. Sovereign Computing means you own your technology, not the other way around.

Stephen DeLorme: This episode is sponsored by ATL BitLab. ATL [00:01:00] BitLab is Atlanta's freedom tech hacker space. We have co working desks, conference rooms, event space, maker tools, and tons of coffee. There is a very active community here in the lab. Every Wednesday night is Bitcoin night here in Atlanta. We also have meetups for cyber security, artificial intelligence, decentralized identity, product design, and more.

We offer day passes and nomad passes for people who need to use the lab only occasionally, as well as memberships for people who plan to use the lab more regularly, such as myself. One of the best things about having a BitLab membership isn't the amenities, it's the people. Surrounding yourself with a community helps you learn faster and helps you build better.

Your creativity becomes amplified when you work in this space, that's what I think at least. If you're interested in becoming a member or supporting this space, please visit us at atlbitlab. com. That's A T L B I T L A B dot com. Alright, on to our show.

Jordan Bravo: Welcome to the Sovereign Computing Show. [00:02:00] I'm Jordan Bravo and I'm here today recording in the heart of Atlanta at a TL Bitlab with Steven De Alarm. What's up? today we've got a great show for you. We're going to talk about a couple of current events in privacy and digital sovereignty. I'm gonna update everybody on my latest in the ongoing saga of how to acquire private.

SIM cards and data for mobile devices. And finally, we're gonna get into our main topic, which is software business models. First, we wanna remind you that you can support the show by boosting in on Fountain FM or other podcasting 2.0 apps. You can also email the show. Our email address is sovereign@atlbitlab.com.

I do want to. I apologize for my voice today. I'm getting over a sickness, so a little stuffed up, but hopefully it doesn't come out too bad on the audio. I think before we [00:03:00] dive into the news articles, I want to give an update on the i ongoing saga of private sim cards. So, uh, I've noticed that there's, the current situation is there's sort of alema where you can have two of the three.

features but not all three at once. And that seems to be, you can have it private, fast, convenient. Pick two. my current setup is that I have private and I have fast with Mint Mobile. The, the inconvenient part is that I have to, you can only buy three months at a time of a mint card in person with cash, so that's private.

It's fast. It is, I'm currently getting about 913 megabits per second, which is awesome. That's like, it's almost a gigabit. I think my, my mobile speed the other day when I tested it was faster than my home wifi speed, which is impressive. but it is not convenient. I don't want to have to go in person [00:04:00] every three months just to re-up my SIM card.

So, I tried something else. I tried an at and t prepaid sim. And the cool thing about that is you can also buy it in person. You can buy it with cash. but they have other plans where you could buy, for example, 12 months at a time. Now, I didn't know if this was gonna work, so I bought a single month at a time and I tested it out.

So we have, private because I didn't have to use any methods of paying for it. That docks my identity. We have convenient because if I can get 12 months at a time, this will be. Acceptable to me. but then what about the fast part? Well, that's where this fell down. I tested it out and it was three, three megabits per second.

That's rough. Yeah, just so remember I just said that my Mint mobile was 913, so that's 300 x difference. Now, maybe I don't live near an at t tower and I live right near T-Mobile Tower, which is what Mint uses. [00:05:00] But something is way off there. So I haven't given up on the at and t card yet. I'm going to actually contact them and see if I can troubleshoot it.

You know, maybe I'm missing something, maybe there's a setting I need to tweak. but I will report back and keep everyone updated as to the, the best options. Oh, I also confirmed that, US mobile like Mint Mobile, they are not accepting vanilla Visa cards on their website. So, The problem there is not being able to pay for it in an anonymous way.

but, but that's it. That's the end of the, the sim updates for today. Steven, did you have any thoughts on that? No, not really. that's, uh, pretty astounding with the at and t, so, but I feel like that it's gotta be something weird going on. So, yeah, give him a call. Figure it out. Alright, we have a couple of interesting news items today.

the first one is an article from the verge, although this source isn't too important, we will of course include these links in the show [00:06:00] notes. and the, the headline is, Google has just two weeks to begin cracking open Android. It admits in emergency filing. And so, EPIC Games for those of you aren't aware, epic is a large video game company.

They make a lot of popular games for various systems, but they earlier, I believe it was last year, sometime in the past 24 months or so, they sued both Apple and Google for their onerous place and app store policies. all apps that go through Apple, for example, the app store, they have to give 30% of any money that they make through that app to Apple.

And um, they also prevent. they prevent the apps from having any kind of external billing or linking out. so Epic sued Apple and it also sued Google for these similar, problems where in addition to not letting people use external billing, they also don't allow any external app stores, [00:07:00] especially Apple, I think is more locked down than that.

Google itself, because Android is more open. You can use alternative app stores and side load applications. However, if you go into Google Place store itself, if you're going through like the Google Blessed path of getting apps, you cannot put any alternative app stores in there. And of course, Google, curates that list of apps.

So there's a limited, You, you have to follow their various guidelines, which include a lot of what I would consider censorship. So anyway, getting back to this article, what happened was Epic won its lawsuit. And so in a court order, Google has been ordered to make several changes that are gonna open up Android and make it a little bit easier for apps to bill in their own way, not go through, the Google Play Store and pay the Google tax.

if you scroll down, Steven, there is a bulleted list of some of the things that Google is going to have to do. so I'm gonna read them off here. There's, they're gonna stop [00:08:00] Google from forcing app developers to use Google Play billing. They're going to let Android developers tell users about other ways to pay from within the the Play Store.

They're gonna let Android developers link to ways to download their apps outside of the Play Store. They're gonna let developers set their own prices. They'll stop sharing money or perks with phone makers, carriers and app developers in exchange for Google Play exclusivity or pre-installation. So, um, basically these are kind of like shady deals that

tighten Google's monopoly on it. And then the last one they give is they will have to work with Epic specifically to resolve any disputes as Google builds a system to let rival app stores in. So the implications of these are kind of cool. We will see what happens. I, my, my instinctive reaction is that Google is going to.

Use every dirty trick in the book to follow the letter of the law, but not the spirit. [00:09:00] Uh, we already saw Apple pulled something similar in the European Union where they were ordered to let, like side loading of apps and stuff. I think they, they sort of skirted that by having some kind of loophole.

But Google, it says here in the, in the article that Google has a certain amount of time to, to. Enable, enact these changes. And it says it was 14 days in the, in the article, but you know how these things go. It, they could always apply or, uh, appeal and get a, uh, what do you call it, A continuation or a delay, an emergency stay, exactly.

What's that word? I'm gonna keep an eye on this. This is promising, but we'll see what happens. Yeah. Surprised, the idea that a company could, you know, a company Google Size could do something in only 14 days. Yeah. That, that's pretty quick. [00:10:00] I would guess that the, that 14 day deadline is a very narrowly scoped action that they'll have to take.

Maybe just kind of showing that they're, they're getting started, something like that. I see. That's, that's just my guess on the matter. That's, that's how it usually rolls with these giant corporations. I. Uh, any other thoughts on this one? Nope. But I do want to take this opportunity to open my seltzer water, which can be cut out or can be left in if we think it's funny.

All right. That'll make it easier for our editor. Alright, let's take a look at the next article. This one is really quick. There's not a whole lot of analysis on it. It is simply that the Linux desktop market share. Is gaining over, uh, 6% of the entire desktop market. So I remember, I've been following this number since about 2020, and I remember it was around two and a half [00:11:00] percent.

And now let, let's put things in perspective. The Linux server market share is 95 plus percent. Uh, almost every server out there is running Linux. however, when it comes to the desktop market, it's a totally different story. Linux as a desktop, and by desktop of course, I mean laptop, any, just running the Linux operating system on whatever machine.

They, again, 2022 and a half percent, and it's been rising steadily, but also kind of in a up curve. So we we're seeing that, that accelerating. I think some of the things that have led to this in recent. Months and years have been the release of Steam Os. Of course Steam is a video game company and they have, created their own gaming console called the Steam Deck.

And the Steam Deck runs Steam Os. And Steam Os is just a brand of [00:12:00] Linux that they sort of customize. It is, it is a built on the base of Arch Linux, but that alone, because the gaming market is huge, has. Given this total Linux desktop share a nice bump. I wonder if I could play Doom the dark Ages on steam MOS When did that come out?

Like, I don't know, a month or so ago? I guess it's possible. Yeah. there's been a lot of work. I, I'm not a huge gamer nowadays, but I do follow a lot of the Linux gaming stuff and, uh, steam has done a lot of work. Their developers have spent a lot of time adapting games that are made for Windows, for Linux.

They have something called, called Proton, which is unrelated to the, the privacy company, but they, it's a compatibility layer for Linux. Hmm. That basically, it, it's not an emulator because emulation always takes a, a massive performance hit. But, uh, this [00:13:00] compatibility layer is, is some way of translating it without that huge performance hit so you can get near native.

Performance on a lot of games. But yeah, I was kind of wondering if Steam os might have something to do with it. I remember hearing about the steam deck, like ideas for it like 10 years ago. Um, I just haven't been following it. so, but yeah, that seems like that would certainly add to the, the share of these things.

Quick aside, the steam deck's really cool. I don't have one, but I've messed around with one. My friend has it. And when you boot it up by default it's in sort of console mode. And, you know, big graphical buttons as you would expect, but you can switch to regular desktop mode and it's exactly like running steam or it's exactly like running Linux on your handheld.

Oh. Um, and, and you can even boot Steam os on a typical desktop or laptop computer because it's just Linux. Huh. That's pretty cool. Cool. Yeah. I wonder what, I wonder if there's anything else that could contribute to the rise other than the Steam os. I think [00:14:00] there's been a little bit of. Increased awareness, uh, or demand for privacy respecting operating systems.

You know, in the past few, uh, months and years I've seen, for example, um, PewDiePie, the famous YouTuber, who I am not a fan of, but it came up on my radar because he suddenly made, started making videos about how he was fed up with windows and he was fed up with Androids. So he switched to Linux, he switched to Graphos, and you know, this guy has hundreds of millions of subscribers.

and I've, I've seen more and more of these videos lately of, non-tech, uh, non uh, privacy obsessed people who are just, who have a big audience and they're switching to, Linux from Windows and Graphos, for example, from regular Android, just for the privacy, just for the sovereign computing mindset of I want this technology to do what I am expecting it to do and nothing else.

And. Not be spying on me and treating me like a baby. That's pretty [00:15:00] cool. I remember like, 15 years ago there was like this trend of tiny little laptops that would run a buntu, and it was, I remember it was like the coolest thing ever because it would be this like, laptop that was like smaller form factor than you're used to, I guess like the same size that like Chromebooks and stuff are, but this was before the Chromebook and.

They were like, I don't, I can't remember if it was Dell or another company, but they started shipping with Ubuntu and it just seemed like the coolest thing ever that was like, oh shit, like Lennox is on like a laptop you can buy at a store. And I just thought that like, it was kind of like Bitcoin and El Salvador is like, oh man, this is gonna take over.

Everyone's gonna be using Linux in a few years because, and the laptops were super cheap and. The, the funny thing is though, I, I don't think they were well received in the marketplace, and I remember this like horrible news expose of like some journalist, like interviewing this lady who had bought one of these laptops, not [00:16:00] realizing that it didn't have windows on it and how like they wouldn't give her a refund and she had no idea how to use it.

And they were interviewing this guy from like. A local computer repair shop, some friendly nerd who kindly volunteered his time to like help her like side load windows into the machine or something like that. And it was like this horrible expose about like these tech companies trying to switch people to Lennox and you know, You know, the, the, the common person being taken advantage of by laptop manufacturers and Linux. And it was just a really interesting framing. It's so weird how these narratives take hold, but no, that was not the year of the Linux desktop the way that we thought it would be. Yeah, maybe this year. That's, that's the joke, right?

Maybe this year, maybe next year. Uh, I did notice one thing at the bottom of this article. It says it's got some reasons, some possible reasons why, [00:17:00] uh, Linux. Usage is rising. And this I had not considered, but it says that Linux has become the default operating system for AI and machine learning workloads due to the prevalence of leading AI open source frameworks such as TensorFlow Pie Torch, and hugging face transformers and open AI's, new open weight models.

So I had not considered that 'cause I do not do AI or machine learning development, but that makes sense. Yeah, that's cool. All right. Anything else you wanted to add on this topic? Oh, not really. Alright, let's get into our main topic for today. We're going to talk about software business models, because our last episode we talked about how we choose software and one of the things we teased was we looked at what is their business model and.

This is important because this can determine a [00:18:00] lot about the software that you're using. for one, it can determine is this company gonna be around in a for the long term, or is it just gonna be a flash in the pan? And, you know, gone soon, you're gonna have to find a replacement. Uh, another reason you might want to think about the software business model is, is this, what is this company doing with my data?

and some of the other things that we talked about last time, but I'll reiterate them, their considerations such as, if I needed to leave and go to a different software, different company, can I easily export my data? Is it in a portable format that's usable elsewhere? So all of these things are affected by the software business model.

They're, and, and what the mo the business model is for a given company is gonna incentivize how they develop their software. You know, where, what their areas of focus are on, how upfront they are and transparent they are with their users, that kind of thing. And particularly open source business [00:19:00] models are of interest here because open source and free as in, uh, doesn't cost any money.

And open source as in free as in freedom, are two different things. And I firmly believe in paying for good software. Because I want a company that is providing value to me to continue providing value and to do a good job and stick around and be successful because, um, I, I want companies that have a good, uh, ethical business model to flourish and be rewarded.

And so if I am using a, a piece of software and I find it valuable, then I would prefer to pay for it. So, uh, but the freedom I'm looking for in software is the. open source in general. Now, we, we mentioned last time, there's a caveat there, right? Open source does not equal good software. Just because something's open source doesn't mean it's great or even good.

but that is, that is one thing to one aspect to look at. [00:20:00] And so for me, there's a couple of business models, particularly in open source, that I consider to be very ethical. And if I see a company doing this or, or this is their business model, I'm gonna be. Uh, I'm gonna have more confidence that this company has my best interest in mind.

So first, let's talk about a couple of business models that are not attractive to, um, in my opinion, the best, the best, uh, interests of the user. The first one is going to be so-called free software free, as in you don't pay, but that they pay for with selling your data. The typical examples of this would be Gmail.

Uh,

you don't actually pay for Gmail with money outta your pocket, at least most people don't on the typical plan. And so how are they paying for those servers and those developers and the infrastructure and their whole company? Well, of course they are using your data for various purposes. They're able to [00:21:00] train AI models.

they're able to. Create targeted ads and build up huge databases on users that they're able to sell to advertisers for targeted ads.

I'll stop here for a second. Steven, do you have anything you wanted to add on that or maybe other business models that spring to mind in terms of ones that you wanna shy away from?

I think that would be the primary one. Yeah. and I'll go ahead and point out that it's like, this is something I struggle with in my mind as I think about how to make products and stuff like scalable and, you know, accessible to more users because like, you know, you could, you could argue that like, you know, the, these kinds of business practices made technology more available to a lot of people, like a lot of.

You know, like the growth of email and instant messaging and all this, it's like the kind of [00:22:00] infrastructure that goes behind making those services really reliable and instantly responsive. And all of that is, you know, and, and, and that you can get all this for free. Anybody on the planet can get this for free really is because of that data intensive business model.

And that's kind of the, the dark side of that that I tend to grapple with. and you know, I've, I've heard people make the argument that like, well, you know, if you use these data collecting services in the right way, then, you know, you can use it in a way to where, you know, they can't really identify you personally and you're just kind of like, tears in the reign.

so it doesn't really matter. but, you know, yeah, it's, that's one like kind of counter argument to that. But yes, I don't like it. It makes me uncomfortable. I'm a much more fan of a direct business model, like proton or something where I know that I'm paying for the product directly rather than paying for it through hidden means.

Yeah. So I, [00:23:00] I have an example of what I would consider ethical business model, and that is for a company called Tail Scale. Tail Scale is a. Company that makes a mesh. VPN. This is a product that is different from the typical like proton, VPN Moad or IVPN. It's not, a competitor to this because it's used for different purposes.

It's a mesh VPN that puts all of your devices on a single network. So if you are a self hoster or um, running servers or any kind of stuff like that, it's really useful. but anyway, what, what they, what the product is, is not. Actually the most important part of this topic, but I want to talk about is their business model.

And that is it is free for up to 100 devices. No limitations, no throttling, but if you want to go beyond that a hundred devices, then you need to have a paid account. And a hundred devices is a lot. You know, how many people, just casual users, have more than a hundred [00:24:00] devices? Very few. So what their business model is actually targeted for is enterprise users.

And so, they, they wrote a great blog article on this, but their idea is that they subsidize this free plan with their enterprise plans and they find that it, that it's worth it because all of their users try it out. They tend, tend to be technical people working at companies as. Software developers, cis admins, DevOps people, they, they use the software on their own home labs or on their own systems.

They fall in love with it. They see how great it is, there's no strings attached. And then they go to work, they go to their companies that they work at and they say, Hey, we should use tail scale. And so by simply landing a small fraction of those free users, businesses, they're able to be fairly profitable.

From what I can tell. They're doing quite well, so. I feel like this is, oh, and on top of that, their, their entire stack is open sourced and they [00:25:00] are even, uh, friendly to self-hosting. So if you wanna self-host, instead of using their managed coordinator server, they've even contributed, they've had their developers contribute to that open source code base, which I think is really cool.

Yeah. So if we call the first one, maybe, uh, data subsidized, subsidized by the user's data. And then, the next one we call that freemium. I think free is great too. Like if you can just, you know, provide something, a piece of software for free in a more limited context and just to figure out what kind of level of usage you actually think your, your market is at, uh, where your, your best customers are at.

so that's always great. There is sometimes a hazard in, in the market, I think of when a company does both of those. They do data subsidized premium, which was like, you know, you can use it for free up until a certain point and we will harvest your data and, you know, maybe try to track you and sell your data and all this kind of stuff and, [00:26:00] but you can pay us for premium level service.

And then sometimes you get to the point where if it's, you know, for, if you're a business signing up and it's a business. level agreement. There may be some clause in the contract where they're not selling your data 'cause it might be like proprietary business information. but you know, and also if you're just a regular user, you might be on a, a freemium pan where you pay for the premium version and they're still selling your data.

So it, it's a complicated thing. So I think data subsidized, yeah, bad, freemium good, but when it's like truly pure freemium, like tail scale where. It really is just a situation where they found that, you know, people who use it for free on the free and end up converting into enterprise customers later on down the line.

Yeah. And I would say if your business model, if your freemium business model cannot be supported without data collection, then it is not a good business model for your product. Yeah. [00:27:00] another example of a company that uses a. Well, actually, let me pivot for a second. Let's talk about a slightly different business model, which is, I would call, maybe you have a better word for this, but I would call it managed hosting, let's say.

Mm-hmm. So for example, element, who is the reference implementation for Matrix or Next Cloud? These are pieces of open source software completely free to use. you can self-host them on your own. You can use them on your own, but. A lot of people don't want to, don't have the time or skill to self-host it on their own, to set up their own infrastructure to support all of the users that they have.

So you can pay for managed hosting, and so a company will write the software and even though they make it completely available, if to anybody as open source and and freely licensed, they provide a hosting service where they themselves will provide managed hosting so that the. Paying customer doesn't have to do any of [00:28:00] that work to set up the infrastructure and can continue to run it, update it, patch it, all of that stuff.

And typically the, you'll see pricing for these will be on a per user, per month basis, or maybe per user per year. and I, I find that this is a very ethical business model as well because they're, they're doing a lot of the development work for quote, unquote free, but then they are paying for these ongoing costs of.

keeping the software updated, developing new features, and paying for their infrastructure by, um, direct payments by the users. And as you add more users, you are justifiably paying more money because it takes more resources and, they're able to sort of subsidize the development with these payments.

Yeah, I mean, I think the managed service is always a great business model. Yeah, it gives you the freedom to not do it, not use their service if you don't want to, but it's still open source and you have [00:29:00] a easy button. So yeah, I'm a fan of that model. What is your opinion on paying a one-time fee versus an ongoing subscription?

For example, would you rather pay a large sum upfront for a piece of software and never have to pay again, or would you prefer a smaller ongoing fee? Hmm, that's a good question. I don't know. I remember back in the day, I think back to being in college and, you know, like, you know, needing a bunch of Adobe tools for graphic design school and like looking at the price of that software and it was like $2,000 for like a suite of just a couple applications.

It was very, very expensive. And later on Adobe switched to the Creative Cloud model, which is pretty, I think it's still $50 a month. It might have increased since then, but they've kept it [00:30:00] at a very flat rate. And it's like, there's pros and cons to it. It's like it, if you were somebody who's like in college or just starting off, just paying 50 bucks a month is much more accessible product for you.

that you can actually use. So I think the subscription models can actually make software and services much more accessible to people. But when you think about it, it's like, like the older software there, there was this mindset shift in the design industry because, you know, like an agency would be used to buying a license for $2,000 and it would be like, well, we can use this forever.

And there was this kind of sense that like the longer we rock this version of Adobe Creative Suite, the more bang we're getting for our buck, the more value we're getting. so and, and it really is true. I mean like if you're just like, say a solo designer and you make that [00:31:00] $2,000 investment or maybe three or 4K, if you're doing all the video stuff too, then it actually does pay off over time.

If you're just like working in isolation. And I think you do lose that a little bit with subscription based software services. You lose that ability to just make an investment and it pays off over the long term. Now, one thing I found working at an agency that, and this was a mindset shift, but I think it did actually make sense, is when you're in a team environment and you're like, one person is on Adobe CS three, and then another person's on Adobe CS four and the other person's on Adobe CS five, it's like.

Well, do we really all want to be on different versions of the software just so we can maximize the value from our, like, you know, you know this like two or three K investment and then it starts to be like lost productivity. 'cause everyone's on different versions of the software. And so in some regards, the subscription model can actually be [00:32:00] very user friendly.

If you're in an environment where it's like critical that everyone be on the most current version of the software, because that's the thing is if you have a pay one subscription model, the, the company, it's very, it's very difficult for the cash flow of the business making the software if it's a pay once model because.

You might make the piece of software and then that, that person is just like a, a solo user might be just using that piece of software for like a decade. And you might, you know, like, well, you need to make security updates. You need to make bug fixes. You might want to add new features. And it's more difficult to be able to subsidize that kind of development when you're not getting consistent cash flow.

And that's the thing with like software companies, when you have a pay once model, you just have these bursts of cash flow when the product hits the market, and then it all kind of trickles. Down after that [00:33:00] point. So I can really see both sides of it. And I think it actually, you could argue that it hurts the users too, where it's like, like I said, you have that situation where you have a company, everyone's on different versions of the software and you know, they may not be getting the most current features and the most current bug fixes, and so it's complicated.

Having said that, there's also a dark side to the. You know, subscription based model as well, where, because the subscription model has been so normalized, I think it really has created an economy of just shitty software as a service companies like I, I, I'm not, I don't want to be some eternal shell for Adobe 'cause they definitely have failed to innovate in many, many key areas.

But just using them as an example. I think overall Creative Cloud has been like a large success just in terms of you have a team, you keep them all on the same feature set, you get bug [00:34:00] fixes and you subsidize Adobe to keep putting out bug fixes and product, you know, updates and all that, everyone in your team can yet.

So I think that has been a model of like subscription stuff being mostly consumer friendly. Though I'd love to hear please boost then if anyone disagrees and just strongly contrary, I'd love to hear what you think about that. They're, they definitely have a bad side of their company, but they like, largely, I think that worked, but then you also have a lot of like subscription models where it's just like, Hey, you know, we hacked together some simple tool on a website and we're charging you $15 per user until the end of time.

And it's just like a product that arguably doesn't add that much value. Like, like something where it's like this solved a problem for somebody. And so they went to this website, signed up for this service, started using it for $25 a month, [00:35:00] because in that moment they needed to solve a problem and. $25 a month was totally worth it.

But then when they need to start sharing their work with their coworkers or their friends or whatever, then it starts turning into $25 a month, $25 a month per person, and then that starts to get like super, super cost prohibitive, and that's where it can become very consumer unfriendly. And then once you just normalize paying monthly fees for everything, we do kind of have this environment of just tons of bad.

LAME software as a service that's way overpriced. So, I don't know, I could see both sides of it. I, I understand from a business perspective why businesses want to do it, and it, it gives you stable cash flow. It incentivizes you, it can incentivize you to keep cranking out, improvements to the product, but you [00:36:00] know, it, it can also go terribly wrong and just, you know.

Lead to a lot of crappy products that are overpriced. So I, I don't know. it just really depends on the company and the product. I'm gonna pause this for a moment to cough. Okay. So, first of all, I want to. Refer people to a YouTube video. Really cool. It's by a designer who, who wrote this video. It's like a love letter or like a, I'm breaking up with you, Adobe kind of video and how he switched to Linux and he's replaced it with other software.

But, it's really cool. It's like very stylistic and fun to watch. I highly recommend it. We should get 'em on the pod sometime. We should do that. so I'll put that in the show notes. I, I recommend checking it out, but, in regards to the, pay upfront model versus ongoing subscription, I think it's really important that companies make it [00:37:00] explicit what you are getting when you pay for software.

So, for example, you pay a a certain amount and it covers a certain period of time, and during that period of time, you could be expected to get security updates or full feature updates or whatever, right? Like. They're not just, it's not sort of nebulous and unknown of what you're getting in return for your money.

some examples of this are Red Hat and Ubuntu. When you pay for a, a license to either of those, you are getting support and software updates for, a certain amount of time. I can't remember off the top of my head. It might be like five years or something like that. But basically you are guaranteed to get security patches.

or excuse me, feature patches including, uh, new features for a certain amount of time, and then security patches for an even more extended time after that. So like, maybe it's five years and 10 years respectively. I don't know off the top of my head. But, the idea is [00:38:00] that you are paying this amount of money and you are gonna get this kind of support over this period of time.

And I think that's really important because you. A, you know, how the company is making their money and what kind of, work they're expected to do in exchange for that. And, and B, you can be expected to know when you need to upgrade and what that's gonna cost you.

when you were talking about the, the subscription fee on websites, these. proliferated SaaS software as a service sites that just, you know, everybody's expected to be signing up for $5 here, $10 there, $15 there for dozens and dozens of services. It, it reminds me that I want to talk about something called dark patterns, or also known as deceptive patterns.

And these are, they are tricks used by apps and websites that make you do things that you didn't mean to do. Like buying or signing up for something. For example, trick wording, [00:39:00] sneaking obstruction. These are terms that we'll talk about, but you, you are all familiar with this, and even if you don't know this, this term, deceptive patterns or dark patterns.

This would be things like, I go to sign up for a site and it's like $2 a month, and then in tiny, tiny light print at the very bottom it says. For the first month, and then after that they start billing you reoccurring at $20 a month, right? I think most of us have experienced something like that. You, you sign up for something that's $2 a month and then suddenly you notice a few months later they've been hitting you for 10 times that amount for the past few months.

This is a incredibly deceptive trick and should be. Looked, watched out for, what are, what are some other dark patterns that you've experienced, Steven? Well, I'll tell you one. I'll call 'em out by name. The company is called ClassPass. I tried them out recently. and, it's like a thing where you can, it's it like any city you're in, you can kind of like book classes, like gym classes, fitness classes, these kinds of things.[00:40:00]

So I was trying out, so I was doing a bit of traveling and so wanted to be able to use some of that stuff remotely. So I tried it out, bought some credits. It, it was cool. I mean, the service was fine and useful, but I just wasn't using it as much. Got a dedicated gym I go to now, so was decided to cancel it.

Oh my God. Canceling this thing was, I was like losing my mind. So, you know, they give you the whole screen, you know, you, you try to cancel the membership and it's like. But wait, do you really want to cancel? You're gonna lose out on all these great perks. And then down at the bottom of the page, a lot of times you may be familiar, like, in design you'll have like a primary button and a secondary button.

Here I'll just do like UI design, primary secondary button. Lemme see if I can pull up an example for those watching on the video. It's like visual hierarchy. So like here on the screen right here, we have like. An example image that's like the primary button is like, you know, maybe the primary button is like dark blue and filled [00:41:00] in, and then the secondary button is like a blue outline.

Or maybe you have a button that has like an negative connotation or something like that. And it might be like, surrounded in a red outline to be like, okay, the big, the big blue, solid blue button is the good button and the, the bad action is the red button. So what they do is they flip it in the user's mind, knowing that intuitively you want to cancel it.

So, but your mind also intuitively wants to tap on the big blue button. So they make the big blue glut and say, nevermind, I'd like to keep my membership, and they make the red button cancel my membership. Then they show you another screen that's the same thing. It's like, are you really, really sure you want to cancel?

What about these perks? Da, da, da, and they do the same thing. The big blue button. The primary button is keep it, and the negative button is cancel. Then they show you the same screen a third time with the same trick, with the primary button to keep it and [00:42:00] the negative button to cancel it. Then they show you the screen a fourth time and they flip the order of the buttons.

They're like, okay, we understand you really want to cancel, and they change. The they SWP swap the order of the buttons so that the cancel button is now the primary button and the negative button is the keep button. And they do that because once you learn that the cancel button is red, you have to tap through the screen so many times that you're gonna accidentally do the keep one.

And there was like three or four other steps I had to go through after that. So it was the worst cancellation. But that is an example of a dark pattern. You're just trying to cancel your service. And I actually thought the product was good and I would've, I would've actually vouched very well for ClassPass.

I mean, I thought the product itself was as advertised and was good, but now, now I'm here, uh, trashing them on the pod because they put a dark pattern in their cancellation flow. That is shameful. That [00:43:00] is just terrible. I'm looking here at the types of deceptive patterns. We'll, we'll list this, we'll, we'll put the link in the show notes, but there's, um.

Maybe 15 of them listed here. And just as you were talking, I think I, I pointed out maybe four of them that they committed that they, uh, uh, violated of these. So, for example, nagging, the user tries to do something, but they are persistently interrupted by requests to do something else that may not be in their best interests, obstruction.

The user is faced with barriers or hurdles, making it hard for them to complete their task or access information. Hard to cancel. The user finds it easy to sign up or subscribe, but when they want to cancel, they find it very hard. So there's a whole bunch of these, but I, I would like to ask the, the listeners, take a look at this list right here and Boost in and Telus.

Have you experienced any of these? Are there any [00:44:00] companies that you want to publicly shame or maybe just, you know, anonymously shame and vent about. The dark patterns that, that you've experienced. Maybe you, when you were signing up, maybe you were tricked into signing up. Maybe you were billed for something that you weren't expecting.

Maybe it was hard to cancel, like Steven was just describing. So let us know and, uh, watch out. For companies like this, these are highly unethical and, to me it's a. It's a red flag on the company as a whole. You know, Steven, you mentioned that, that you thought ClassPass had a decent product, but if a company is doing these kinds of practices, I think you might wanna steer clear of 'em.

Yeah, exactly. And uh, that's the thing. Once you have a company, they're incentivized to grow and, Y Yeah. Not everybody does it ethically. I see you've pulled up the hull of shame. So this, this, this website that we're referring to, deceptive [00:45:00] patterns has a hull of shame and they go through and, and check out some of them.

We're not gonna read 'em here today, but, they've got a, a series of companies, a lot of 'em, you'll recognize all the big ones, but it's, it's pretty great.

Well, bringing it back to our main topic and, and how this fits into the bigger picture, you wanna look out for dark patterns. Obviously avoid companies that, that do these, keep an eye out for the business model. You know, if you are not paying, how are they making money? You want to, you wanna be asking yourself that when you're choosing your software, and then if you determine how they're making money.

Is it something you're comfortable with? Is it ethical? Is it respecting your data and your privacy? again, if you ever had to leave, would it be easy or would they make it really difficult? So this is kind of a, an addendum episode to our previous topic about how to choose software. but I think there's enough here that I wanted to give it its own episode [00:46:00] and get into the real nitty gritty of, of these different software business models.

Alright everybody. Thanks a lot. We'll see you next time. All right. Catch you later.

Stephen DeLorme: Hey, thanks for listening. I hope you enjoyed this episode. If you want to learn more about anything that we discussed, you can look for links in the show notes that should be in your podcast player, or you can go to atlbitlab. com slash podcast. On a final note, if you found this information useful and you want to help support us, you can always send us a tip in Bitcoin.

Your support really helps us so that we can keep bringing you content like this. All right. Catch you later.