Friday, July 13, 2007

A Nice Deal on Software (but a Bad Idea?)

Right now, MacUpdate is running a great promotion, with a bundle of useful programs at a good price. The promotion is obviously based on MacHeist, but the character of the bundle is different. The programs in the MacUpdate bundle are selected based on the best-selling previous promotions, which makes the bundle maybe less flashy, but probably more useful overall. I've bought the bundle, and hope enough others will buy in order to "unlock" all the applications.

That said, the promotion is appropriate to this blog for a much different reason. The promotion has an odd property that there are a number of disincentives to buying it early, but that it really requires early purchases to make it successful. There are seven apps to start, with three others that get "unlocked" if enough people purchase. So, if you buy early, you risk not getting the "locked" apps if the bundle doesn't sell well. Also, there was originally a system where, after buying, you could send an invitation to others, who would get a one-year paid membership to MacUpdate. While the benefits of that membership are pretty marginal, it's another reason to put off purchasing -- someone might send you an invitation, after all. Happily, this invitation system has been corrected by now.

The promotion thus seems to have a Nash equilibrium for the "don't buy" state. While I didn't pay much attention to MacHeist, largely because I'd already registered the only programs in the bundle that were of interest to me, it would also have had such a Nash equilibrium. It is clear enough that MacUpdate based their promotion on the success of MacHeist, but is this really a good idea in the long run?

Update: I think that the final paragraph might need to be clarified a bit. I mention that MacHeist was successful, and also that it had the same sort of Nash equilibrium that the MacUpdate promotion features. It might seem strange that I'm pointing this out as a problem for MacUpdate, when MacHeist was successful. In short, I'm arguing that MacHeist was successful despite the "unlock" portion, and certainly not because of it. Further, claims that MacHeist was successful are true in absolute terms, but do not validate the unlock idea; it could well be that MacHeist would have sold more without the unlocks.

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