On December 14, 2016, my team and I pushed a significant change to our Easy Digital Downloads products: we increased the price on all extensions by 50-250%. Yes, you read that right: up to a 250% price increase on certain plugins. This change was done for a number of reasons, which I will get into shortly, and has resulted in a very interesting last three months. Since I have always been very open with my company’s financials, I would like to now share some reflections on the change that we made and to also share some of the aftermath of the change.
Since the beginning of Easy Digital Downloads, and I imagine many products, customer support has always been our biggest challenge. Taking care of customers is hands down the most difficult job in the company. It is ripe with challenging problems to solve, long hours, relentless flows of new tickets, on-going conversations that spread not only over days but even weeks and months. Providing good and, when possible, great customer support is, to put it simply, exhausting.
There have been many times over the last 5-7 years where I thought to myself I’m sick of this; I just can’t keep taking care of these people, maybe I should quit. I have had those thoughts and every member of my team has had those thoughts. On one particular evening back in November, I was sitting on my couch doing my best to work through a not-abnormally sized support queue, and it hit me: this has to stop. This wasn’t the first time I (and many other members of the team) had spent insane hours working through support queues, nor was it the 50th time. Working late to help finish support requests is an every single day occurrence. It literally never stops. This time, however, I had had enough (fifty times too many) and decided it was finally time to take drastic measures to reduce support. I hopped into our Slack channel and told my team this and within a few minutes we’d made a decision: it was time to increase prices. It was past time, actually, but late is always better than never.
When a company is faced with an over burdensome support load, there are a number of ways that most companies look to address it:
- Fix the bugs that cause problems to happen that then result in support tickets
- Improve UX so customers better understand how to achieve certain results
- Write more and better documentation
- Hire more support team members
- Move team members from non-support roles to support roles
- Outsource support
- Release fewer updates
- Release more updates
- Remove problematic features / products
All of these methods are 100% viable and our team has implemented all of them. There is, however, another method that people tend to gloss over or ignore, and it is perhaps one of the most effective of them all.
To lower your support load, all you need to do is have fewer customers.
It may seem like the opposite of what most companies want, after all customers are the people that make it possible for companies to pay their bills and their team members. Without customers, companies cease to exist.
The real answer to lowering support burdens is to have fewer but more valuable customers.
On that evening in November, my team and I decided it was time to try and drastically reduce our support burdens by dramatically raising prices, thus reducing the number of customers while simultaneously increasing the average value of customers. Theoretically this would allow us to keep our revenue about the same (which was just barely covering our monthly expenses) or, if all goes well, raise our revenue and lower the total number of support tickets we received each month.
That was the hope anyway.
We threw a lot of numbers back and forth while discussing the possible changes we’d make to pricing. In the end we had several goals:
- Raise the average customer value
- Lower the number of customers, thus lowering the number of support requests
- Keep overall revenue steady or raise it
Due to the sheer number of plugins sold through easydigitaldownloads.com, there were a lot of different price points. We sold plugins as low as $6 and as high as $149. Our primary plugins were priced at $29, $49, and $82, and just one was priced at $149.
As a general rule, we came up with the following guidelines on picking new plugin prices:
- Plugins that power fundamental aspects of a store, such as licensing, multi-vendor marketplaces, subscriptions, etc, would be priced at the top tier of $199. These were previously priced between $82 and $149.
- Plugins that are priced at $49 (mostly payment gateways) would be increased to $89.
- Plugins priced at $29 (email marketing plugins and some other miscellaneous plugins) would be increased to $49.
- Plugins priced between $12 and $19 would be increased to $29. This was determined to be the lowest price point we’d offer.
- Bundles, such as the Core Extensions Bundle and the Digital Marketplace Bundle, would be increased according to the new value of the plugins included in the bundle.
In some cases, this resulted in plugins having $10 added to their price tag, and in others the increase was as much as $117.
There are a number of statistics we can look at to help gauge the effectiveness of our price increase and we’ll go over those shortly, but there’s a non-scientific metric I want to look at first.
Team happiness and morale.
I do not need a psychology degree to tell you that the price increase has significantly affected the happiness and day-to-day mood of the team. For more than 12 months, our team has been faced with the problem that is Easy Digital Downloads. Yes, I mean that: the problem that is Easy Digital Downloads. You see, EDD is seen around the WordPress community as this great plugin that is wildly successful and a model to look up to in the commercial plugin ecosystem. While this is a reputation that we take great pride in, the honest truth of the matter is our team has struggled with EDD for months because in many ways it has felt like a sinking ship. We’ve seen stagnated revenue growth (even declines), higher-than-ever maintenance costs, relentless support queues, and a whole series of other challenges that our other two primary projects (RCP and AffWP) simply do not have. In comparison to EDD, those projects are cake walks.
The price increase has been enormously successful in making the team feel good, and the importance of that should never be ignored.
One of the primary results we needed to see in order for this change to be successful was a significant decrease in support tickets. It has now been three months since the price increase, so how’ve we done?
- New tickets submitted: down 0.2%
- Total tickets handled: down 43%
- Total customers interacted with: down 35%
- Conversations per day: down 42%
The total number of tickets submitted barely changed, but the other three statistics are incredibly significant. A 42% decrease in the number of tickets handled each day. That means EDD handled 10-15 fewer tickets every day, which translates to a considerable less amount of time spent working on tickets for our team. We have an average handling time of 5 min and 49 seconds per ticket, meaning we have removed one to one-and-a-half hours of support work per day by increasing prices.
Assume, for a moment, that we pay $25 per hour for support technicians. Removing 1.5 hours per day equates to approximately $37.50 in savings each day, or, when extrapolated out, approximately $13,687 per year in reduced support costs (if assuming zero volume change).
Revenue and sales
Along with a decrease in support burdens, we hoped the price increase would also provide a much needed boost to our monthly revenue. As mentioned in my 2016 in review post, Easy Digital Downloads operated at a loss for much of 2016, so increasing our revenue was an important measure on the success of the price increase. If we managed to decrease support and increase revenue, we’d consider it a home run.
To gauge the effect the price increase had on revenue, I decided to compare three different time periods:
- January to February, 2016
- August to September, 2016
- January to February, 2017
These time periods are good representatives of our average revenue as they do not include any special promotional sale periods and they allow us to compare similar periods from before and after the price adjustments.
The summaries below provide a good overview of the revenue statistics for each of the time periods used for this comparison.
January to February, 2016:
- Sales (including free): 3,861
- Refunds processed: 106 – $8,765.40
- NET revenue: $100,530.39
- Average order value: $28.31
- New paying customers: 664
- Average value for new paying customers: $131.30
August to September, 2016:
- Sales (including free): 3,930
- Refunds processed: 74 – $4,454.95
- NET revenue: $100,262.55
- Average order value: $26.65
- New paying customers: 565
- Average value for new paying customers: $116.57
January to February, 2017:
- Sales (including free): 3,009
- Refunds processed: 65 – $7,530
- NET revenue: $114,376.70
- Average order value: $40.57
- New paying customers: 373
- Average value for new paying customers: $154.95
There are a few primary changes I’d like to highlight here. First, notice that the NET revenue increased by ~$14,000 in 2017 compared to the two 2016 time periods. With that NET increase, however, the total sale count decreased significantly, by more than 800 in fact. This also resulted in our average order value increasing from $28.31-26.65 to $40.57.
The total amounts refunded also possibly suggest that higher value customers are less likely to request a refund, perhaps because they do more ample research before committing than lower value customers.
This change also caused our average customer value (for brand new customers) to jump up to $154.95 from $131.30 and $116.57.
We are only part of the way through March, but the numbers are already looking even better than January and February. This is partly due to the promotional sale we ran for the end of winter, 2017. We shall see if the remainder of March and April hold up with the trend so far.
The price change has also had an interesting effect on commissions amounts that we pay to 3rd party vendors. In 2016, we paid an average of $16,000 per month to 3rd party extension authors. For February and January, this average has dropped to a little over $12,000 per month. While this is not an overly positive change for most extension vendors, it is a change that we see as an overall positive change for our company. This change primarily happened because of a decrease in the total sales, though it is also due in part to us reducing the number of 3rd party products we sell through the site. We have repeatedly learned just how difficult running a multi-vendor marketplace is and, as a company, we’ve determined that is not something included in our long term goals so we have continually worked to reduce the number of 3rd party vendors we directly work with. I hope to share more on various changes we’ve made over the years that have affected vendor commissions soon.
When combining the increase in revenue with the decrease in support burdens, this price change has so far appeared to be incredibly positive for us. It is a single move that might just be one of the most important changes we have ever made.
Gauging the success of a price change based on customer reactions provides some really interesting insights. Using customer satisfaction as a metric, however, is something you must be careful with. In much the same way that star ratings tend to highlight the most unhappy and, oftentimes, unreasonable customers, the customer reactions to price changes typically show those customers that are the most unhappy. It’s unfortunately rare to hear from the happy customers or those that support your price change.
Within hours of pushing the price change live, we received our first reaction from a customer that who been considering a purchase during the time we were updating the prices:
Can you please confirm what is going on? How price jumped to the sky in a matter of seconds, I’m client of you and want to include multi-vendor option, it is even an effort to invest those 91 USD.
That reaction is fully reasonable, especially if he’d already added the items to the cart (our system could not account for already-in-cart items).
The second reaction we received:
Did the price of the Recurring Payments plugin really increase from $83.00 to $199.00 since January?? This was an unpleasant surprise. :/
Technically this was true, though with a brief explanation from Sean, her reaction completely turned around:
Awesome. Thanks for the explanation. I’ll look forward to exploring the features.
This customer did end up completing her purchase and has not contacted us since.
So within a few hours, we’d had two negative reactions but one of them turned into a positive experience for both parties. Over the next few weeks, we continued to receive emails from customers reacting to the price change. Many customers, interestingly, asked if the price increase was some kind of error.
Is there an error on your website or did your price in the last week just over double in cost? I was looking at making a purchase when I just did a refresh and saw the huge price increase.
We knew we’d get a decent amount of flack for our price increase, especially as we chose not to alert customers (new or old) of the price increase before it happened. Whether this was the right choice or not, it was one we made intentionally. We felt there was a good chance that publicly mentioning our price increase before it happened would simply provide a place for people to pile negativity on us, and it would create a permanent record of that negativity for others to stumble upon. Doing it silently was like ripping the bandaid off in one fell swoop. It’s done, it hurts, but then it’s forgotten a short time later.
I still don’t know if doing it silently was the right choice, but there were numerous customers that were irate because of that particular decision. One person’s response was perhaps the most difficult to stomach. They started out perfectly reasonably:
I am in the process of renewing my plugin licenses again, everything looks good but I noticed that you’re now charging $199.00 (139.30 discounted) for Software Licensing? What is up with that?
I paid like $42 last year and certainly can’t afford to shell out $140 or more every year for a plugin. Not to mention the additional $40 every year for the other EDD plugins I’m using…
Please, tell me that a 200% price increase is some kind of mistake..
To that I gave a calm, collected, though perhaps too generic response, which really did not go over well, as can be seen by his reply:
Wow, so calm and collected.
Well, regardless of what YOU think about it:
1) It’s a 350% price increase (!!!)
2) It’s called gouging the customer
3) It’s called betraying all those people who got on board for 350% less, thinking that, even if the price increases, it will remain an affordable deal despite the annual renewals
4) You should grandfather existing customers at the original price instead of screwing them over
5) I expected much more from you, Pippin.
6) Maybe it’s time to create a similar competing plugin, sounds like it’s a very lucrative market, and would be much less expensive than getting screwed for a 350% price jack.
7) You won’t get away with it
8) It was a horrible decision
9) Even if I do renew this year, I’ll be looking for a complete replacement of the very overpriced EDD plugin suite that I have to keep paying for, over and over and over and over again.
10) Raising prices by 5%, 10%, or even 25% is reasonable. 350% is just greedy.
11) Do your current customers get 350% more value? Nope. They get the same old thing, only YOU benefit.
12) This list will be the outline of my next blog post
13) A textbook example of a bad move, how not to raise prices, and how to screw over your customers.
Seriously unbelievable move. I was all on board with you guys. Not anymore.
350% price jack = unbelievable gouging of your “valued” customers.
I could go on and on, but I’ll save it for the post.
I have had a fair share of people throw derogatory remarks my way, but this one was a bit different. This felt incredibly personal because it came from a person I’ve respected and looked up to for a long time. In fact, this response came from one of the very first people I looked up to in the WordPress community. Having them express their extreme displeasure at my decision to raise prices and method with which we chose to implement the change was painful.
It should be noted that we did grand father in all customers that had an active subscription (one that automatically renews). The only affected customers were those with manual renewals and new customers.
When you get these kind of reactions, it’s important to keep a fact in mind: companies do not need to justify their prices.
Perhaps the most telling thing from all of the reactions we received was just how horribly undervalued Easy Digital Downloads (and similar platforms) are in many customers’ minds. Here we had a customer that was seriously unhappy about paying $140 per year for plugins that provided the functionality they needed to operate their own store. Previously this customer had paid just $42 per year to run their store with EDD.
I’ve had friends, colleagues, and advisors tell me our prices have been too low for years, and I couldn’t agree more. It is absolutely crazy that we’re more accustomed as a society to pay $5 for a latte from Starbucks, which we will consume in a matter of minutes, than we are to pay $12-$20 per month for platforms that allow us to operate our businesses. We are accustomed to paying $80-$100 per year for subscriptions to Netflix and Hulu but we react with revulsion and disgust when a company asks for $150 per year to provide software that businesses literally rely on to bring in their own revenue. In the United States (where the customer above lives), we’re used to paying $50-$100 per month for cable TV subscriptions, but we expect software to be provided for so much less.
As a world, we are better at paying for things that rot (figuratively and literally) our insides than we are paying for things that help us provide for the health and wellbeing of our families and employees.
This disparity in pricing expectations is asinine. Unfortunately, huge companies like Apple and Google have perhaps single handedly helped to create this through the rock-bottom prices of their respective app stores. Between the 1980s and early 2000s, it was common for video games, which take hundreds of hours to create, to cost $40-$50. This price was normal and expected. Once the app stores rolled around, however, expected prices dropped so low that companies now get practically eviscerated if they try and charge just $10 for a full length game in the Android or iOS app stores.
Quote from a review of Super Mario Run:
With a £7.99 price tag, Super Mario Run certainly isn’t cheap, but it’s easily one of the best smartphone games around.
Isn’t cheap? Seriously? It’s roughly the cost of just two lattes or one-three pints from many pubs, both of which are gone within a matter of minutes.
It’s high past time software providers charge appropriately based on the value they provide. If we cannot even ask for a decent price, how can we possibly continue to build platforms that power the web and the world around us?
My final reply to the angry customer was lengthy and has served as a good sounding board as I worked through this reflection post. I ended with:
Perhaps our definition of “appropriate” is different, but the last time I checked, EDD provides me (with the ability to run my stores) far more value than any monthly TV subscription or coffee service. Would I pay $500-$1500 per year to operate the stores that provide for my family and employees?
Perhaps it was my explanation of why we chose to increase prices so severely or perhaps it was the price disparities provided that convinced this customer, but they did end up sticking with us.
This makes sense, I understand where you are coming from.
I went ahead and upgraded. The renewal discount always is appreciated.
Thanks for the great response. Enjoyed it.
At this point, we are very happy with how the price change has worked out for us and Easy Digital Downloads. We were happy enough, in fact, that we decided to implement a similar price increase on Restrict Content Pro and AffiliateWP, which went live on March 1, 2017, just a few weeks ago. We did end up making some adjustments to how we rolled out those price changes and so far the changes appear to have worked well. It is too early to tell just how effective they will be, but we are confident that it will prove to have been the right choice in 3-6 months.
Do you have thoughts or reactions? I’d love to engage with you in the comments.
157 thoughts so far
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No matter. The guy who said Pippin lacks business sense of course doesn’t know the full picture but I understand the point he was making because you generally see this happen a little bit in tech companies.
The founder is a tech wizard and understands the products and the customers who use them but of course then the company grows and grows and suddenly the tech guy is in charge of staffing and payroll and financing and forecasting and has to start making business decisions in areas where they have no experience. Being a jack of all trades can be good but sometimes it is difficult to be a master of them all.
The fact that prices have been raised so much suggests that the original forecast of how much to charge was way off course. Why? Where was the product research and customer feedback? When the prices were raised how were the new prices decided? What did your research say? What was the feedback from your focus groups or users? What was the outcome of the surveys you sent to customers old and new? How many of your current user base did you select for this research? How did you arrive at the timing of the price changes and so on. These are things that an astute company would consider before reaching a decision, not some kind of suck it and see. I have not received a single message in my inbox I must be unlucky I guess.
I think most of the people on here saying they applaud the decision have been grandfathered in at the old price? Well it is easy to say of course that you like the price rises when you are not affected by them. Now you get better support for the same price as before. It’s the new customers that are now subsidising the old ones.
Talking of subsidy. Why if I do not want support am I paying for it? This doesn’t seem fair. You will surely know what the cost of the plugin is and you then layer the support cost on top of this amount. If I don’t want to pay the extra amount why do I have to? The reason is surely that I am supporting the people who do need support. Why am I subsidising them? It does’t seem fair to me.
My final point is that you used to beat WooCommerce hands down.
– Better pricing
– Better support
– More trusted
Now I can say that your support will be better always because there support is so bad. I mean my dog could do a better job and it has been dead for 6 months. But, now your pricing is about the same and I am sorry to say that the manner in which these price changes have been rolled out has also made trust a little less. I am sorry but it is true.
So now you leave a vacuum to be filled. The problem as CafePress will tell you is that when you have a GPL product then there are plenty of willing takers to come along and bastardise your code and undercut you on price. And there are plenty of people willing to pay less 🙂
So you say you don’t want a monopoly and well this is good for customers because they get more choice but of course you have to be a little bit careful what you wish for because I think you may find that over the next few years extra competition in the market might be your undoing. Which would be a great shame. The WordPress ecosystem needs as many Pippin Williamson’s as it can get, so I hope you reconsider because I think you will find that you will start to lose customers and also friends in the community. I am not suggesting you should be allergic to money but for every positive there is a negative, such is life.
I really appreciate your comments and feedback!
Note: no comments were deleted. If you’re not finding some, you may just need to click the “Older Comments” link at the bottom of the page: https://cloudup.com/cUnLImRkUTM
Your insights about tech founders being placed in a role where they are making decisions they’re not familiar with is exactly correct and is an experience I’d assume most company founders experience at one point or another. I am, for example, a much better developer than I am a manager of people. I am also much better at managing finances than I am with creating successful marketing campaigns. In the end, one of the defining characteristics of a successful company is the founder’s ability to bring the right people on to do the jobs she/he is less capable of or does not have the time availability to do. Filling the roles that I am not personally able (or perhaps do not want) to do has been a constant focus for me over the last two years, and I can tell you with absolute confidence that I believe I have done an exceptional job at this. The team I have working with me today is better than the best team I would have ever imagined.
You, along with several other comments, have mentioned a so-called lack of research around this price increase. I would like to address this because, while an understandable viewpoint, it is fundamentally incorrect.
We have been building and selling Easy Digital Downloads since April, 2012. In fact we’re approaching our sixth year of doing this. And before EDD we had more than two years of selling other plugins (more than 30 different ones in fact). While that may not seem like a terribly long time for many businesses, it’s actually a very long time for a 100% digital business, especially in the realm of WordPress. We’ve been around since the very beginning of commercial plugins and that means we have seen (and used ourselves) nearly all of the different pricing schemes and levels. We have massive amounts of “research” data that backs up any and all decisions we make.
Because of the long history and the amount of real-world data we have, we know very well how customers will react; we know very well how it will affect support volumes; we know very well how it will affect customer acquisition; we know very well how it will affect customer trust and happiness. None of these things were “unknowns” to us and they all helped us to form and execute a plan.
There has been some concern expressed about how customers are now paying more for the same support. This is also incorrect. One of the primary things that make a company’s support quality suffer is volume. When the volume gets too high, support teams are over burdened, stressed, and constantly overwhelmed. When a company drastically reduces the volume of support, the quality of support provided can increase significantly.
Our support will significantly improve because our capacity to provide better support is dramatically increased through lower volumes.
That’s certainly possible, though I hope for our sake and our customers’ sake that you are incorrect. 🙂 At this point in time I am more confident than ever in our longevity. We are here to stay.
What happens if the support costs do NOT go down per your expectations? What is Plan-B? Will you raise the price again? Do you have any idea (research) as to what the highest price you can charge is?
That was taken into account.
As noted in the original post, we’ve already seen a significant reduction in support. The price increase has already removed 1.5 hours of time in support each and every day for our team. It has also already reduced the average number of tickets we work on per day by 42%.
Those are hugely significant.
If, however, that is not sufficient, the price increase has also raised our monthly revenue by (thus far) $7,000. A portion of that could easily be allocated to a new team member to help out with support.
Keep in mind as well that lowering support volumes isn’t the only objective. The price increase also provides us with the means to put more time and money into development, documentation, and marketing, thus improving the overall platform for all customers. This also has the side effect of, ideally, lowering support even further, which then lends itself again to more development, documentation, and marketing efforts being possible.
@Pippin “In the end, one of the defining characteristics of a successful company is the founder’s ability to bring the right people on to do the jobs she/he is less capable of or does not have the time availability to do.”
Something I struggled with for several years, but so right about.
That’s a lot of food for thought. Thank you very much for this article. I am currently in the process of increasing prices so it’s perfect timing!
Just curious, is that “NET revenue” after paying you/your employees?
It’s before paying employees.
I’ve used several of your plugins before, as well as inheriting websites which have used your plugins. I can honestly say that I’ve always found support to be great and the plugins have always done the job well. Increasing your prices to reflect the effort involved in maintaining and developing them is perfectly acceptable. In many ways even by multiplying the costs by three times, you then only need a third of the custom to make the same money. I think getting paid a fair price for your efforts is perfectly acceptable and I applaud you doing so.
Its good to see you have written a post about this price hike. I think its good for your buyers and readers who will understand the reason behind the hike.
Great article. I was one of those customers considering a purchase of the Marketplace Bundle at the end of 2016 and then having made the decision to go with EDD early this year, found that my budget was going to have to be amended! However, it didn’t stop me going ahead as it is was clearly still a great value proposition. It’s great to read now the thinking behind the change and I am greatly reassured that this will only help your team in continuing with the product and providing the excellent support which I have already made use of a few times.
My minor problem is you already had a buffer and additional revenue by having products like Manual Purchases. Which to me should clearly be part of the core product. I believe in the past the justification for these very minor point products, that provide a single bit of functionality, was essentially the same as you are making for this out-sized price increase. But as a company who also develops plugins I understand the problem/cost/fatigue of support and perceived value of plugins. Hoping you help raise industry prices in general, even if this was a bit …bold?
Thank you for your thoughts, Mark! There are a couple of items I’d like to address here, however.
I find the very idea that anyone can be “wrong” or not justified in putting a price tag on any feature of their plugins silly. We are justified simply by the fact that we created it. Period. Regardless of how necessary or commonly-needed a feature is, it’s not wrong to ask users to pay for it. Ever. Rather than thinking of each premium portion of a product as a downside, every free portion should be considered a bonus. Whether it’s a wise business decision to price stamp certain features is a different discussion, but at a philosophical level there is nothing wrong with it in my eyes.
Manual Purchases, as an example, was originally made a premium product because it was something people would almost always be willing to pay for out of necessity. If you want to have a successful business that is built upon a free platform, you have to give customers ample reason to actually buy your premium offerings. To do that, put a price tag on features / systems that people need. It’s no accident that our most successful products are the ones that people need in order to operate their store. None of the best selling products in our company are “nice to haves”.
The Manual Purchases plugin is one of those features that people need and so are willing to pay for. It is, however, also a pretty low earner because, due to its nature as a single-feature plugin, it has a low price tag. Last year the plugin made a grand total of $6,117.80 in revenue. This price increase, however, is what actually allows us to discontinue it as a premium product and instead roll it into the core Easy Digital Downloads plugin, which we will be doing soon. By increasing the price tag of our primary product offerings, which are plugins like Software Licensing, we become able to remove the price tag from simple, one-feature plugins like Manual Purchases, as those little plugins are no longer required to sustain us.
I am a customer who went digging around after noticing the huge price increase, which I found quite frustrating as I made the decision to use your product explicitly on a long-term calculation of on-going cost – which has now skyrocketed. Sure the price is worth it, but as a business executive with 15+ years in startups I run my companies by the numbers and strictly only by the numbers, so I am not thrilled when the numbers suddenly change.
I realize that you’re not going to appreciate this post, but I think this needs to be said… I am sorry if this post upsets you, but I’d still love a straight-forward answer.
What exactly stops someone from purchasing your plugins, and then sharing them for free with others? Your code is licensed under the GPL and thus so are all the plugins, which is a requirement of the GPL license.
Your contract to which users agree at purchase time acknowledges that the product is licensed under the GPL. You attempt to place additional restrictions in the contract but those restrictions are absolutely not legally binding because they’re directly at odds with the GPL license which absolutely supersedes your contract.
I am curious what you have to say on this matter?
Here is a good summary (from http://wpandlegalstuff.com/understanding-gpl-licensing-wordpress/):
>> I’m a theme/plugin developer. I’ve put huge effort into writing my theme/plugin and I’m going to release it under the GPL but I want to make sure that everyone who receives my theme or plugin, even if from someone else, is obliged to pay me a licensing fee or notify me that they have it. Can I do that?
No. As the Free Software Foundation puts it, the “GPL is a free software license, and therefore it permits people to use and even redistribute the software without being required to pay anyone a fee for doing so.” Similarly, if someone receives a copy of GPL’d software, that person does not have to inform the developer that s/he has it. You are entitled to charge a fee for access to support and later versions, but this is quite different to requiring recipients to pay a licensing fee for merely using the software.
>> I’m a commercial theme or plugin developer. I sell my GPL’d theme or plugin online, behind a pay wall. People can only access the theme or plugin files after paying my prescribed fee. Does the GPL allow me to do this?
Yes. You are entitled to charge a fee for distributing copies of GPL’d software. Note, however, that anyone who obtains a copy is entitled to release it to anyone else, with or without charge; the GPL allows this to occur.
I actually really do appreciate this comment. It raises some important points for anyone selling or buying products under the GPL.
The answer is simple: nothing.
While I certainly do not appreciate it when someone takes one or more of my plugins and redistributes them, I understand precisely why it happens and I greatly appreciate the facets of the GPL that make it allowable to do and I intentionally do not put any effort into preventing redistribution. Whether it’s labeled as “piracy” or “legal redistribution”, my answer is the same.
I’m often a member of a rather small group of people that think this way, I actually believe very strongly that spending time and effort figuring out how to make it harder for dishonest people to take things from you is generally a waste of time.
Piracy (or legal redistribution) happens in just about every industry, but the impact that it has on your business largely has to do with how you choose to fight it. If you take an active approach and invest multitudes of time, effort, and money into combatting those that have no appreciation for the value of your product, you will actually undermine the intrinsic value of the product. How? Simply by investing time, money and effort in the wrong place. I prefer to take the time, effort and money that I could use to fight piracy and invest it directly into real customers and the people that have an appreciation for what has been built. Is some money lost due to piracy? Maybe. Is a whole lot more gained by investing in the customers that matter? Absolutely.
My team and I choose to invest our time and efforts into making experiences better for the customers that buy our products, at the old and the new prices. They are the ones that matter.
I am curious why you are choosing to conflate piracy (violation of the law) with explicitly permitted actions under the GPL?
I am not understanding whether you’re actually licensing all the code you sell through your website under the GPL or not?
Because it seems like you’re doing two things at the same time, which makes no sense. You’re saying “yes, this is GPL and you’re free to do whatever you want with it under the GPL license” and then “oh wait, using your rights under the GPL is piracy”.
Which is it?
I didn’t say it was illegal piracy, I simply compared redistribution of GPL code to piracy to answer your question about the effect it has on our business when someone takes our code (which they are legally permitted to do under the GPL) and redistributes it. To answer that, I compared this redistribution to piracy. My exact words were:
Here is the specific clause of the GPL that addresses this matter for your reference:
(From 7. Additional Terms. @ https://www.gnu.org/licenses/gpl.html)
All other non-permissive additional terms are considered “further restrictions” within the meaning of section 10. If the Program as you received it, or any part of it, contains a notice stating that it is governed by this License along with a term that is a further restriction, you may remove that term. If a license document contains a further restriction but permits relicensing or conveying under this License, you may add to a covered work material governed by the terms of that license document, provided that the further restriction does not survive such relicensing or conveying.
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