Webapps which duplicate the functionality of open-source tools can make money, but I think they have to position themselves well. Basically I think people will pay for this type of webapp if:
* The web app is substantially more convenient than the desktop open-source app,
* It is important/useful that the app in question be available anywhere, not just on the user's computer, or
* It is much simpler to use than the free app and provides a service useful to people not used to open-source tools.
* this is the first time they have ever heard of the service you provide (and they don't subsequently search for free versions), or they aren't aware that free versions exist. For example, although I am a blogger and a web professional, I did not know that externally hosted backup tools for blogs existed. This might make advertising difficult, however, if you are using Adwords, since your competitors will make themselves known.
* you have convincing sales copy, your site is well-designed & high quality, etc. (i.e. you're good at sales)
* what you provide is higher quality than free alternatives (more stable, more reliable, has support, etc.)
* what you provide is differentiated from your competition (e.g. through superior features)
"Are there not sufficient free open source tools to monitor your server and mail you when it goes down? Why would some of those big ticket customers ever pay for something like this?"
You're trading money for (someone else's) time. I could build pingdom for my own services, but I don't want to. I'd have to build it, scale it, maintain it, and monitor it.
I'd rather pay someone else to do it for me, and I'm technical.
Not to mention that for website availability monitoring you may want tracking from multiple geographical nodes (east coast, west coast, midwest, etc). Add on reporting, compliance related information storage, etc, and you're talking about a service worth paying for (to some people).
I think you're right on with reporting. So many people need data laid out for them to hand to their boss, or just so they can understand what's going on. Getting data to tell your story, or the "real" story at all, can be worth a lot of money.
Other advantages of Pingdom which aren't easy to emulate:
* Pingdom measures response time and availability from multiple points on the internet, which is very useful for working out if there are issues with your connection.
* Pingdom will alert you of downtime even in the case that there's a catastrophic failure of all your monitoring.
Both of these things are useful even if you're a big company with a lot of internal monitoring.
> * our time is precious, we'd rather not do it ourselves.
This is the simple reason why the majority of people buy things. Why does 99% of the population go out and buy their fish rather than go down to a stream with a rod and a tub of worms?
I don't have the skills and resources (IE time) to either code my own webapps or to rely on open-source tools, despite how much I would like to. So when I have the option of, if something goes wrong, saying "Hey, I paid you, what-the-hell?!" I don't take this approach with computer maintenance and networking as I can handle that in my sleep, I can't handle my server-monitoring worth a damn. As I'm not up-to-date on any open-source server-monitoring tools, I'm always going to be at a loss if I try to set it up and don't care to keep up to date.
Similar questions can be asked as to why HN users, who are likely more pro-organic than the regular population are paying for something that is free and easy to do. I've grown organic, pesticide & fertilizer free herbs and vegetables, so why doesn't everyone else? Because to me it seems as simple as pushing a seed into soil, but I know people who have difficulty in keeping a cactus alive and would by far prefer paying for their organics.
Your second point (monitoring of your monitoring tools) is a very key point for this particular example. I've seen many people through together a quick install of WhatsUP or Nagios or whatever, then get caught with their pants down months later when they find their monitoring server's been down for days and they didn't know it.
Is there really a Pingdom equivalent in FOSS land? I'm not sure - I do not use it, but I've seen many cases where open source advocates claim they have "equivalent" software, but in reality they just have base-level libraries that are half-way there.
e.g., a DOCX-parsing library is not the same thing as a MS Word competitor. Having the libs to do something is not the same as having a turnkey solution ready to fly.
A better thought is this: why is that people are willing to pay money to not use free, open source software? It's either a triumph of marketing, or a strong commentary on the quality of your open source project.
Lets continue with the pingdom example. I work for a small startup and the reason why we would pay for a webapp to do these things is because it is not a part of our product or one of our core competencies. So settings up and managing these things is a waste of developer/sys-admin time, and in the long run, it turns out to be cheaper to just outsource it.
Its the same reason we pay for github rather then set up our own git server, and the list goes on.
This is a great question. I've asked myself as much and I think it comes up any time someone decides to sit down and write an app.
To me, the short answer is that pople can be enticed to pay for webapps when the app delivers value and solves a problem. Open source tools all too often solve a problem, but do so in a way that fails to deliver value.
For certain customers, there's a difference between " I can do this myself " and "It's worth it for me to do this myself". Open source solutions usually fall into the first category. Paid apps allow customers to answer no to the second question.
$10, or even the $40 plan, is a negligible cost to even a 1-man operation, and to a "big ticket" company, it might as well be free. So don't even take into consideration the cost. Keep in mind "open source" software isn't actually free, you have to pay an engineer to install and maintain it, learn how to configure it, fix it when it breaks, etc. Those costs are easily higher than $40/mo even if someone's only spending 15 minutes a month on it.
What Pingdom seems to be offering is a (basically free if your business isn't being funded on a credit card) service that requires very little time and know-how to maintain. Clients probably chose it because their time is more valuable than the monthly cost of the service. Contrast that to open-source, which is perfect for those who'd rather spend extra time than extra money.
If the service saves me a bit of time and headache, then yes I will pay for it. For your blogVault, do what I suggested in your comment: Allow me import ALL my historical writings (of which I am sure there are about 10.000 pages of floating around on the internet), and I'll pay you what you want. I want my writings on paper, not on websites that shut down and throw away stuff I spent a lot of time coming up with.
You are underestimating the mental and actual friction caused by open-source. Paid services bring a peace of mind that your server won't crash, some setting won't mess up etc. To a technical guy, those things may seem super small. But (1) little maintenance things add up (2) they are worth not having to deal with especially if you can pay just a few bucks for the peace of mind.
My start up went through several stages of site monitoring. First I'd set up a script that curled a couple URLs and emailed me if it didn't work. I wanted slightly more sophisticated monitoring and I wanted text messages. So I tried to install Nagios. It was a pain and I never got it set up.
Then SiteCanary posted their launch here. I signed up that day and never thought about monitoring again. It's worth every penny (and it's really cheap). I'm sure I'd otherwise be spending at least an hour a month on monitoring.
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[ 8.1 ms ] story [ 771 ms ] threadhttp://ycombinator.com/newsguidelines.html
* The web app is substantially more convenient than the desktop open-source app,
* It is important/useful that the app in question be available anywhere, not just on the user's computer, or
* It is much simpler to use than the free app and provides a service useful to people not used to open-source tools.
* this is the first time they have ever heard of the service you provide (and they don't subsequently search for free versions), or they aren't aware that free versions exist. For example, although I am a blogger and a web professional, I did not know that externally hosted backup tools for blogs existed. This might make advertising difficult, however, if you are using Adwords, since your competitors will make themselves known.
* you have convincing sales copy, your site is well-designed & high quality, etc. (i.e. you're good at sales)
* what you provide is higher quality than free alternatives (more stable, more reliable, has support, etc.)
* what you provide is differentiated from your competition (e.g. through superior features)
You're trading money for (someone else's) time. I could build pingdom for my own services, but I don't want to. I'd have to build it, scale it, maintain it, and monitor it.
I'd rather pay someone else to do it for me, and I'm technical.
We pay for Pingdom's service because:
* our time is precious, we'd rather not do it ourselves.
* we don't want to be monitoring our monitoring tools to make sure their work.
* they provide a lot more features (reporting, API), which we actually need and use.
* Pingdom measures response time and availability from multiple points on the internet, which is very useful for working out if there are issues with your connection.
* Pingdom will alert you of downtime even in the case that there's a catastrophic failure of all your monitoring.
Both of these things are useful even if you're a big company with a lot of internal monitoring.
This is the simple reason why the majority of people buy things. Why does 99% of the population go out and buy their fish rather than go down to a stream with a rod and a tub of worms?
I don't have the skills and resources (IE time) to either code my own webapps or to rely on open-source tools, despite how much I would like to. So when I have the option of, if something goes wrong, saying "Hey, I paid you, what-the-hell?!" I don't take this approach with computer maintenance and networking as I can handle that in my sleep, I can't handle my server-monitoring worth a damn. As I'm not up-to-date on any open-source server-monitoring tools, I'm always going to be at a loss if I try to set it up and don't care to keep up to date.
Similar questions can be asked as to why HN users, who are likely more pro-organic than the regular population are paying for something that is free and easy to do. I've grown organic, pesticide & fertilizer free herbs and vegetables, so why doesn't everyone else? Because to me it seems as simple as pushing a seed into soil, but I know people who have difficulty in keeping a cactus alive and would by far prefer paying for their organics.
e.g., a DOCX-parsing library is not the same thing as a MS Word competitor. Having the libs to do something is not the same as having a turnkey solution ready to fly.
A better thought is this: why is that people are willing to pay money to not use free, open source software? It's either a triumph of marketing, or a strong commentary on the quality of your open source project.
Its the same reason we pay for github rather then set up our own git server, and the list goes on.
To me, the short answer is that pople can be enticed to pay for webapps when the app delivers value and solves a problem. Open source tools all too often solve a problem, but do so in a way that fails to deliver value.
For certain customers, there's a difference between " I can do this myself " and "It's worth it for me to do this myself". Open source solutions usually fall into the first category. Paid apps allow customers to answer no to the second question.
I went into a bit more detail on my blog at http://nathanroach.posterous.com.
What Pingdom seems to be offering is a (basically free if your business isn't being funded on a credit card) service that requires very little time and know-how to maintain. Clients probably chose it because their time is more valuable than the monthly cost of the service. Contrast that to open-source, which is perfect for those who'd rather spend extra time than extra money.
Then SiteCanary posted their launch here. I signed up that day and never thought about monitoring again. It's worth every penny (and it's really cheap). I'm sure I'd otherwise be spending at least an hour a month on monitoring.