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msmobiles.com/f
dicussions about Microsoft Smartphone and Pocket PC phone
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msmobiles.com_robot
Joined: 23 Mar 2004
Posts: 16777215
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 Posted: Tue Mar 11, 2008 8:57 pm Post subject: Handango cashes in not only on developers |
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Probably Handango didn’t get enough from Vulture Capitalists - "only" $9.5 million - so
that’s why, they take more from the developers !
Read more at http://www.msmobiles.com/news.php/7189.html |
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alcedes
Joined: 29 Sep 2007
Posts: 273
Location: Phoenix, Arizona, USA
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| Posted: Wed Mar 12, 2008 12:32 am Post subject: Is it really unfair? |
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There's teo ways of comparing Handango's business model to Apple's business model on selling applications for developers.
I've found the first view to be more common amongs the web sites I frequent; that Handango is giving developers meager shares while hording an unfair share of the sale while apple is generous.
The other way to look at it is that (currently) there is more market share of Windows Mobile phones than iPhones and thus there is more economic opportunity for software on a Windows based phone than on the iPhone. As such one stands to make more on a Windows Mobile program than on an iPhone program.
Ofcourse this is just a thought that can be validated and invalidated in a number of ways (ex: an argument against what I've said is that Apple can more easily advertise to iPhone customers than Handango can to Windows Mobile customers) but something to consider. |
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EJR
Joined: 18 Mar 2004
Posts: 2629
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| Posted: Wed Mar 12, 2008 7:43 am Post subject: Re: Is it really unfair? |
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| alcedes wrote: |
The other way to look at it is that (currently) there is more market share of Windows Mobile phones than iPhones and thus there is more economic opportunity for software on a Windows based phone than on the iPhone. . |
this is common misunderstanding! actually if 0.005% of many users buy applications then it is less than if 5% of few users buy applications and I have heard from various developers that sales of their applications for iPhone exceed many times sales of their Windows Mobile applications... so "number of phones sold = bigger opportunity" is plain wrong. |
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kieranEire
Joined: 12 Oct 2005
Posts: 282
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| Posted: Wed Mar 12, 2008 9:14 am Post subject: |
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Yet another inaccurate post on this site. The sales model used by Handago cannot be compared to apples.
First the post is inaccurate, apple do not just charge 30% they charge a $99 to join their developer program or $299 to develop proprietary, in-house apps. This is only availble to developers in the US and remeber Apple also make profit on the sale of the device. This means you have to pay cash up front before you even make a sale.
As for Handango they are the worlds leading retailer of smartphone software. They have built that brand up over many years. Here is the reality check this site needs to make their is a reason Handango are number one and that is the consumer.
Its strange how your critical of Hangango but not critical of Microsoft for sponsoring them. Why are you not asking people to boycott Microsoft products. |
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Metoo
Joined: 23 Aug 2005
Posts: 49
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| Posted: Wed Mar 12, 2008 10:20 am Post subject: |
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| kieranEire wrote: | Yet another inaccurate post on this site. The sales model used by Handago cannot be compared to apples.
First the post is inaccurate, apple do not just charge 30% they charge a $99 to join their developer program or $299 to develop proprietary, in-house apps. This is only availble to developers in the US and remeber Apple also make profit on the sale of the device. This means you have to pay cash up front before you even make a sale.
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$99 hardy breaks the bank and is only a one off fee - on the other hand Handango milk the developer of 60-70% for every sale of every product, for life.
| kieranEire wrote: |
As for Handango they are the worlds leading retailer of smartphone software. They have built that brand up over many years. Here is the reality check this site needs to make their is a reason Handango are number one and that is the consumer.
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The person that needs a reality check is one who believes that the Handango brand is more familiar to the public than Apple and iTunes, or that Handango have achieved their position through consumer choice.
Like consumers would "elect" to pay an extra $4.99 "protection" for every product they buy, in case they need to re-download it in the next 12 months. |
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kieranEire
Joined: 12 Oct 2005
Posts: 282
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| Posted: Wed Mar 12, 2008 4:03 pm Post subject: |
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| Quote: | | $99 hardy breaks the bank and is only a one off fee - on the other hand Handango milk the developer of 60-70% for every sale of every product, for life. |
Its a big fee for a product selling at $4 that only sells 10 copies. With the Handango model at least you would not make a loss. This model will not suit the single developer sitting at home writting a piece of software by himself in his spare time. Also thats $99 dollars a year not a one of payment + 30%. Again Apple are also able to leverage monies from the sale of the hardware.
| Quote: | The person that needs a reality check is one who believes that the Handango brand is more familiar to the public than Apple and iTunes, or that Handango have achieved their position through consumer choice.
Like consumers would "elect" to pay an extra $4.99 "protection" for every product they buy, in case they need to re-download it in the next 12 months. |
Look heres the facts the worlds biggest suppliers of mobile software are Handango that is the reality. They are the number one brand for selling mobile software. For example for Spb Mobile Shell 2.0 there have been over 110 000 downloads at $30.00 a unit. That software has only been released. Another fact customers are using Handango over the many other alternatives that websites, including this one have tried to set up. With no impact on Handangos trade whatsoever as the market is consumer driven not software developer driven. Handago is not just a reseller website but a service provider providing Ecommerce SDKs, knowledge bases, customer care, market place research and analysis, investment brokers, trade show organisers etc. I find it laughable that a site promoting Microsoft based devices complains about corporate practice. |
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SPPassion
Joined: 21 Sep 2005
Posts: 11
Location: USA
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| Posted: Wed Mar 12, 2008 9:57 pm Post subject: |
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I don't care about the fancy math or whatever anyone says, IMHO, 60% share in Handango Pocket is a RIP-OFF!! No matter how you look at it. On top of that, they have nerve to ask for software protection or whatver the hell they call it..this is ridiculous practice!. I know someone may say, oh nobody put a gun on your head to buy software from handango..you will be darn right as I don't buy software from them. Instead, I always check the developer's website first. Someone trying to defend Handango is a Joke. I am not taking msmobiles.com side or anything and lot of times, I don't agree with their views but on this issue, I am thankful to them to bring this issue in light as I for sure did not know about Handango hoarding a big chunk of selling price.
Keep up the good work guys!!
Peace!
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Metoo
Joined: 23 Aug 2005
Posts: 49
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| Posted: Wed Mar 12, 2008 11:35 pm Post subject: |
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| kieranEire wrote: | | Look heres the facts the worlds biggest suppliers of mobile software are Handango that is the reality. They are the number one brand for selling mobile software. For example for Spb Mobile Shell 2.0 there have been over 110 000 downloads at $30.00 a unit. That software has only been released. Another fact customers are using Handango over the many other alternatives that websites, including this one have tried to set up. With no impact on Handangos trade whatsoever as the market is consumer driven not software developer driven. |
I can't believe how you defend this extortion. Since you raised it, let's use your figures for Mobile Shell:-
110,000 x $30= $3,300,000
Because that's a gross revenue of over $1m, Handango take a cut of SEVENTY PERCENT = $2,310,000.
Leaving SPB to net just $990,000
That's not counting the extra $544,500 Handango try to fleece their "customers" for 12 months' enforced download "protection" - making the end user pay the hosting costs!
Now tell me again how Handango are not abusing their industry "dominance" (their description), and holding developers, and consumers, to ransom? After all, less net revenue means less investment and motivation for new products.
Especially when compared to Apple, who are providing a much better distribution channel, (one-click browse, buy & download OTA direct to handset, as well as via iTunes, plus automatic version update notification), at a cost of just $99 membership + 30% commission, with _no_ other charges?
| Quote: | | Handago is not just a reseller website but a service provider providing Ecommerce SDKs, knowledge bases, customer care, market place research and analysis, investment brokers, trade show organisers etc. |
And I suppose Apple don't do any of this? Have you actually used any of Handango's customer "care"? I have several times - and it was almost non-existant. |
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kieranEire
Joined: 12 Oct 2005
Posts: 282
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| Posted: Fri Mar 14, 2008 3:41 pm Post subject: |
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Handango provide a service that is clearly in demand. Spb Mobile Shell have had over 1000 downloads in a day. Thats $10,000 for Spb per day. No paying marketing, sales etc staff.
The reality is if developers don't like Handango they can go somewhere else, though they don't. How do I know this because just about every piece of software for sale is available there. Why is this, because its better to give Handango $20,000 and make $10,000 than to give other websites $5000 and only make $7000. If developers do not like Handango then don't use them and stop whinging. Heres the reality they can't because they cannot get over to such a large customer base anywhere else. Esentially what they want is marketing, branding, sales etc for without paying for it. Maybe you should ask sites like msmobiles how much they spend on marketing, sales or how many tradeshows they organised or investors they attracted for the software they are selling. Yet for that they are still asking for a percentage.
With Apple you will have no other choice, you either use them or you do not distribute your software to anything other than unlocked devices. They certainly will not market your software for you or show it at a tradeshow. |
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Metoo
Joined: 23 Aug 2005
Posts: 49
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| Posted: Fri Mar 14, 2008 6:30 pm Post subject: |
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| kieranEire wrote: | | Handango provide a service that is clearly in demand. Spb Mobile Shell have had over 1000 downloads in a day. Thats $10,000 for Spb per day. |
More flawed figures. Actually it will be nothing like that. Downloads include trials. 1000 downloads does not equal 1000 sales.
| Quote: | | No paying marketing, sales etc staff. |
So SPB don't run their own website, product showcase, support pages, or market and advertise their own product anywhere but Handango? Or does your "reality" really think someone designs, maintains, moderates and hosts sites like www.spbsoftwarehouse.com all for free?
| Quote: | | The reality is if developers don't like Handango they can go somewhere else, though they don't. |
I expect they'd dearly love to run, especially after the latest round of price hikes. But the reality is that once they're signed up with Handango, they can't, or there is little point in doing so. That's all because there is a clause in the contract which says:-
"At no time shall the Software's SRP provided to Publisher be higher than the Software's SRP provided to other distributors."
Which means that after the the developer has set the SRP to take into account of Handango's huge 70% cut, they can't offer it cheaper anywhere else, even if the other outlet is charging ZERO commision. So they either face charging an inflated price to ALL customers, or charging a realistic price and taking a loss on Handango sales. If that's not enforced price-fixing and anti-competitive behaviour, I don't know what is!
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How do I know this because just about every piece of software for sale is available there. Why is this, because its better to give Handango $20,000 and make $10,000 than to give other websites $5000 and only make $7000. |
You're dreaming up figures again - and forgetting Handango fleece 60-70% off the likes of SPB, not 50%. And where did you drag $5000:$7000 from (41.6%) figure from, other than to talk rubbish?
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If developers do not like Handango then don't use them and stop whinging. Heres the reality they can't because they cannot get over to such a large customer base anywhere else. Esentially what they want is marketing, branding, sales etc for without paying for it.. |
Again, it's you who's lost touch with reality. No one's asking for it free. But it seems only one person here thinks that a 70% cut, plus double-charging the CONSUMER for repeat downloads, as well as forcing the developer into price-fixing, is reasonable behaviour - especially when other sites take as little as 20%. Do you really think that forcing developer and software costs up though the roof encourages innovation and is good for the industry?
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With Apple you will have no other choice, you either use them or you do not distribute your software to anything other than unlocked devices. They certainly will not market your software for you or show it at a tradeshow. |
Really? So the user being able to browse and buy the entire catalogue direct from their device via App-Store and iTunes, for just 30% commission, is not marketing? And all the software advertised on store.apple.com is not being marketed? And all the Apple Roadshows with software vendor tie-ins and exhibitions are fictitious? And Steve Jobs' really didn't showcase several new software products on his recent iPhone SDK keynote broadcast?
One has to wonder just who is paying you to defend Handango's apparent abuse of their market position. Here's an interesting post that suggests that it doesn't stop there...
http://www.boygeniusreport.com/2008/02/16/handango-revises-cda-says-screw-you-to-developers/comment-page-1/#comment-126068 |
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kieranEire
Joined: 12 Oct 2005
Posts: 282
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| Posted: Sat Mar 15, 2008 3:17 am Post subject: |
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| Quote: | | More flawed figures. Actually it will be nothing like that. Downloads include trials. 1000 downloads does not equal 1000 sales. |
There are no figures of sales however the reality is no other website will get any developer 1000 downloads per day. The reality is thats what SPB Mobile shell did. No other web site will expose software to the consumer as much as Handango.
| Quote: | | So SPB don't run their own website, product showcase, support pages, or market and advertise their own product anywhere but Handango? Or does your "reality" really think someone designs, maintains, moderates and hosts sites like www.spbsoftwarehouse.com all for free? |
I never said SPB did not run their website or any department. However what is clear is despite what they do by themselves they still use Handango. If their own website or marketing etc was so good then why distribute software on Handango. Its because Handango reach more customers and they are without doubt the best mobile software resellars around at the moment. However if I set up my own mobile software company using Handango I do not need to market or handle the selling of my software.
| Quote: | Which means that after the the developer has set the SRP to take into account of Handango's huge 70% cut, they can't offer it cheaper anywhere else, even if the other outlet is charging ZERO commision. So they either face charging an inflated price to ALL customers, or charging a realistic price and taking a loss on Handango sales. If that's not enforced price-fixing and anti-competitive behaviour, I don't know what is!
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If you believe so then why don't you try and sue them? Though I do feel that this is ironic considering this forum is dedicated to a Microsoft product. This is normal and standard amonst resellers. It would only be illegal or anti competative if Handango where fixing prices with other resellers such as pocketgear etc.
| Quote: | | You're dreaming up figures again - and forgetting Handango fleece 60-70% off the likes of SPB, not 50%. And where did you drag $5000:$7000 from (41.6%) figure from, other than to talk rubbish? |
Clearly reading is not your strong point. I quote myself, "Its better to give Handango $20,000 and make $10,000 than to give other websites $5000 and only make $7000." Further clarification therefore is $10000 + $20000 = $30000. Handango get 20000 or 66%. Other websites would mean $7000 for the developer and $5000 for the resellar totaling $12000 in sales (around 42% for the developer). This is purely hypathetical however the point is making less profit per unit, though selling many more units can mean more profit for the developer. As my example shows and this is what Handango as the largest reseller of mobile software offers.
| Quote: | | Again, it's you who's lost touch with reality. No one's asking for it free. But it seems only one person here thinks that a 70% cut, plus double-charging the CONSUMER for repeat downloads, as well as forcing the developer into price-fixing, is reasonable behaviour - especially when other sites take as little as 20%. Do you really think that forcing developer and software costs up though the roof encourages innovation and is good for the industry? |
This is just plain naivety to suggest Handango are somehow in control of the mobile market place. Developers are not forced into Handangos contract, they are not forced to use Handango and there are plenty of alternatives out there. The reality is mobile software developers want the coverage handango gives though by only paying the same rate of resellers who do not encourge investment, who do not market software, who do organise trade shows etc. Infact these other resellers throw the software onto the website with not much more. Clearly developers do want many of Handangos services and the use of the Handango brand for free. Supply and demand determines prices and clearly not only are Handango getting the demand from the consumer but the supply to match the demand from the developers. There is not law against any company trying to maximise profits and get the best deal possible for their company. This is how capitalism and the western world work.
| Quote: | | Really? So the user being able to browse and buy the entire catalogue direct from their device via App-Store and iTunes, for just 30% commission, is not marketing? And all the software advertised on store.apple.com is not being marketed? And all the Apple Roadshows with software vendor tie-ins and exhibitions are fictitious? And Steve Jobs' really didn't showcase several new software products on his recent iPhone SDK keynote broadcast? |
Yawn, apple are doing nothing new here at all, and no apple is not marketing any software besides its own. Making software available is not marketing, Handangos InHand is a catalogue on your device. Why would you need your software on Apples website when you can purchase and download it directly from your device? Secondly Apple did not showcase several new software products on his recent iPhone SDK keynote broadcast they showcased the iPhone SDK. Thirdly again I will popint out Apple have been able to leverage monies from the consumer directly due to the sale of hardware. Apples marketing model is setup to promote iphone and their platform not developers software. |
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kupe
Joined: 18 Aug 2004
Posts: 513
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| Posted: Sat Mar 15, 2008 2:58 pm Post subject: |
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| SPPassion wrote: | | I don't care about the fancy math or whatever anyone says, IMHO, 60% share in Handango Pocket is a RIP-OFF!! |
Still they have a steady supply of software providers - I wonder why? If you want to be self righteous about something like this, why don't you focus your rage on the music industry where Artists (singer/songwriters) pull down about 10-15% of the royalty base of a CD...a royalty base which is about 66% of the selling price...so an artist get about $1.25 for every $15.00 CD sold. Sweet deal, huh? Another example: Steve Jobs provides each artist about 12 cents (US) for each dollar he charges on iTunes. Handango is only following the same business model as Steve's - except Handango appears to be a lot more generous. Go figure 
| SPPassion wrote: | | On top of that, they have nerve to ask for software protection or whatver the hell they call it..this is ridiculous practice!. |
Just like every electronics store tries to hard-sell you into buying their (useless ineffective) store warranty - easy enough to avoid that expense, wouldn't you say?
| SPPassion wrote: | | I know someone may say, oh nobody put a gun on your head to buy software from handango..you will be darn right as I don't buy software from them. Instead, I always check the developer's website first. |
OMG! Another free service from Handango - advertising! You need only go to their easy-to-find, easy-to-navigate website, find what you want, then go buy it directly from the software developer. Sounds like a sweet deal to me.
| SPPassion wrote: | | Someone trying to defend Handango is a Joke. |
I defend capitalism and open markets. At least Handango works within both of these premises (as opposed to the music industry). Developers hardly need to use Handango (yet hundreds do), consumers don't need to use Handango (yet tens of thousands do), Handango is not a monopoly (use PocketGear, PPC Central, et al, instead), so everyone has choices. It's all good.
And for the record, I don't buy from Handango - ever. I can always find a better deal for the software I want. However I do enjoy Handango's free service where they advertise new software and tell me who the developer is so I can learn about the program then shop it around for the best price - maybe even directly from the developer.
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