Archive for April 2013

The Patent Protection Racket 02 Apr

The fastest growing industry in the US right now, even during this time of slow economic growth, is probably the patent troll protection racket industry. Lawsuits surrounding software patents have more than tripled since 1999.

It’s a great business model.

Step one: buy a software patent. There are millions of them, and they’re all quite vague and impossible to understand.

Step two: FedEx a carefully crafted letter to a few thousand small software companies, iPhone app developers, and Internet startups. This is where it gets a tiny bit tricky, because the recipients of the letter need to think that it’s a threat to sue if they don’t pay up, but in court, the letter has to look like an invitation to license some exciting new technology. In other words it has to be just on this side of extortion.

Step three: wait patiently while a few thousand small software companies call their lawyers, and learn that it’s probably better just to pay off the troll, because even beginning to fight the thing using the legal system is going to cost a million dollars.

Step four: Profit!

What does this sound like? Yes, it’s a textbook case of a protection racket. It is organized crime, plain and simple. It is an abuse of the legal system, an abuse of the patent system, and a moral affront.

In the face of organized crime, civilized people don’t pay up. When you pay up, you’re funding the criminals, which makes you complicit in their next attacks. I know, you’re just trying to write a little app for the iPhone with in-app purchases, and you didn’t ask for this fight to be yours, but if you pay the trolls, giving them money and comfort to go after the next round of indie developers, you’re not just being “pragmatic,” you have actually gone over to the dark side. Sorry. Life is a bit hard sometimes, and sometimes you have to step up and fight fights that you never signed up for.

Civilized people don’t pay up. They band together, and fight, and eliminate the problem. The EFF is launching a major initiative to reform the patent system. At Stack Exchange, we’re trying to help with Ask Patents, which will hopefully block a few bad patents before they get issued.

The Application Developers Alliance (of which I am currently serving as the chairman of the board) is also getting involved with a series of Developer Patent Summits, a nationwide tour of 15 cities, which will kick off a long term program to band together to fight patent trolls. Come to the summit in your city—I’ll be at the San Francisco event on April 9th—and find out what you can do to help.

Free as in Fortune Cookies 30 Apr

Trello has been out for less than two years and it’s been growing like wildfire. We recently hit 1.5 million members, of whom about 1/3 perform some action every month, and our MongoDB database now contains more than 70 million cards on 3.7 million boards.

So the obvious question I get all the time is, “How exactly are you supposed to make money with that?”

You may have noticed that Trello is free. Not “free trial,” not “freemium,” but just plain old free. Some people have justifiably wondered if it really makes sense to pay a dozen people, nestled in fancy offices with free lunch and espresso, to develop software that we have to pay Amazon cash money to host, while not actually charging for said software. Some have commented that this business model might actually be just a few fries short of a Happy Meal.

What we really wanted to do was make a free product that helps millions of people, and then find some way to get paid by the 1% of those people who get the most value out of it. The 1% are delighted to pay. They actually email us asking if there is some way they can pay us. A fortune-cookie factory was so pleased with Trello they sent us a crate of tasty fortune cookies. Custom, Trello-color fortune cookies, with Trello fortunes inside. (Don’t tell the IRS, because that’s basically all we’ve made off of Trello to date, and I don’t think we declared it.)

How do you identify the users who get the most value out of Trello? We thought any medium-to-large organization with lots of different Trello boards and many active Trello users must qualify. So then we tried to think of what kind of value-added stuff we could build and sell (for money) to organizations with lots of active users. Besides cookie dough.

The most obvious things were features around security (permissions, backups, etc). Big organizations have people coming and going all the time, so they might benefit from tools that make it easy to add people to Trello en-masse, and tools to make sure that when people leave the organization, they're removed from any boards they should be removed from. The kind of stuff that’s helpful when tens or thousands of people inside an organization are all using Trello every day.

We also added a feature called “observers,” which lets you add people to a board who might have permission to watch, vote, and comment, but who can’t add cards or move cards around. This is meant to give professional landscapers, developers, web designers, consultants, and fortune-cookie factories a way to let their paying customers peek in on the progress of their project without messing it up. It’s a classic example of a feature that is only useful when you’re in that class of Trello users who get the most value out of it, so paying should be a no-brainer.

We bundled these features up and called them Trello Business Class. It's available today for $25 a month (per organization), or $200/year if you’d like to pay in advance. Of course, Trello itself is, and will remain, free, but starting today, we hope to actually make a little bit of walking-around money, too.

In the future we'll continue to add free features to Trello (there is a lot of exciting stuff in the hopper)—anything that is a common feature, useful to anyone, will be free. We’ll also continue to develop new Business Class features that help large organizations manage Trello, and we may come up with other things to sell to people who are getting a lot of value out of Trello. In the meantime, we sure appreciate the cookies!

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