Comment by dsr_
3 days ago
The Lemon Market exists specifically when customers cannot tell, prior to receipt and usage, whether they are buying high quality or low quality.
3 days ago
The Lemon Market exists specifically when customers cannot tell, prior to receipt and usage, whether they are buying high quality or low quality.
Wow, that's actually a good argument for some kind of trial or freemium setup. Interesting.
That must be why WinRAR became so popular. :-)
That does not describe the current subscription-based software market, then, because we do try it, and we can always stop paying, transaction costs aside.
There are two costs to software: what you pay for it, and the time needed to learn how to use it. That's a big different to the original Lemon paper. You don't need to invest time in learning how to use a car, so the only cost to replacing it is the upfront cost of a new car. Worse "Time needed to learn it" understates it, because the cost replacing lemon software is often far more than just training. For example: replacing your accounting system, where you need to keep the data it has for 7 years as a tax record. Replacing a piece of software will typically cost many times the cost of the software itself.
If you look around, notice people still use Microsoft yet ransomware almost universally attacks Windows installations. This is despite everyone knowing Windows is a security nightmare courtesy of the Sony hack 2014: https://en.wikipedia.org/wiki/2014_Sony_Pictures_hack
Mind you, when I say "everyone", Microsoft's marketing is very good. A firm I worked lost $500k to a windows keyboard logger stealing banking credentials. They had virus scanners for firewalls installed of course, but they aren't a sure deference. As the technical lead for many years, I was asked about my opinion of what they could do. The answer is pretty simple: don't use Windows for banking. Buy an iPad of Android tablet, and do you safety critical stuff on there. The CEO didn't believe a tablet could be more secure than a several thousand dollar laptop when copy of Windows cost more than the tablet. Sigh.
So the answer to why don't people move away from poor quality subscription software is by the time they've figure out it's crap, the cost of moving isn't just the subscription. It's much larger than that.
The transaction costs are generally significant.