Adobe Might Be Blindsided By The iPad

I read a piece recently by Elliot Jay Stocks that made a pretty compelling case that Adobe might be shooting themselves in the foot with overly bloodthirsty pricing in the iPad marketplace:

Adobe’s pricing model

Perhaps it’s foolish of me to be surprised by the extortionate software prices set by Adobe — it’s certainly their usual practice — but the shocking aspect is that Adobe are going to charge recurring fees on top of the standard software price. That’s totally understandable, since releasing an iPad magazine incurs a hosting overhead (primarily for in-app purchasing), but these fees are astronomical. Here are some of the figures quoted by MacUser, based on current approximate currency conversions:

• £3636 per year (fixed) for the ‘Platform Fee’ required for in-app purchasing.
• £3367 per year (minimum) for the’Distribution Service Fee’, which is effectively a downpayment for the £0.16 per issue Adobe will charge, starting at the minimum commitment level of 25,000 downloads (even if you hit nowhere near that amount).

That equates to £7003 per year as a minimum spend — irrespective of how many copies you sell, or how regularly you publish — and that’s on top of the one-off charge for the new 5.5 version of InDesign: £94 as an individual upgrade from CS5, £238 for a suite upgrade from CS5, and considerably more if, like me, you’re upgrading from CS4: £190 for InDesign on its own and £619 for the whole suite. Brand new, InDesign CS5.5 costs £714 and the suite costs £1810. That’s what you’ll be paying to Adobe. On top of that, there’s the 30% per-download charge publishers are required to pay to Apple (which, for the record, I regard as fair, especially as it’s considerably lower than what physical shops take for stocking your magazine).

To put that into perspective, if we released an iPad version of 8 Faces and charged £4 per issue, we would have to sell around 2700 downloads before we broke even, and that doesn’t even take into consideration the time needed to actually create the app, which I’d put at around three weeks.

Enter, Push Pop Press, a new game changer potentially. Push Pop Press is a startup by former Apple engineers Kimon Tsinteris and Mike Matas, who devised a platform to create media-type apps for the iPad, based on work they were doing for Al Gore, getting his book Our Choice: A Plan to Solve the Climate Crisis onto that device.

Brian Chen, Gore, Ex-Apple Engineers Team Up to Blow Up the Book | Gadget Lab

When released, Push Pop Press could aggressively compete with Adobe. Currently, many publishers rely on Adobe’s expensive Creative Suite tools to lay out their print pages and to digitize their content for Apple’s iPad.

Push Pop Press could likely undercut Adobe on price, not to mention ease of using the product. An interactive magazine, book, comic book or photo essay can be created with Push Pop Press in as little as 20 minutes, the programmers claim.

However, Matas and Tsinteris don’t view their software as a long-term competitor with Adobe. The software giant has a lock-down on the high-end of the creative field, Tsinteris said, and Push Pop Press’ core audience will likely be smaller publishers looking for an easy, drag-and-drop solution to create apps.

“This is a layout tool, not a developer tool,” Tsinteris said. “It’s a little like playing with Legos.”

My observation is that the solution that does 80% of what is needed for 20% of the cost can usually walk away with 80% of the market, and then add back the missing 20% of functionality as add-ons and plugins, later. Meanwhile, the fatcat competitor who wants the additional 80% for only 20% of functionality goes out of business.

Push Pop Press and others in this space, like OnSwipe (‘insanely easy tablet publishing’) will bring down Adobe, fast.