While the app was initially used primarily by individuals who made a few airport pickups per year, today Just Landed is increasingly used by professional limousine and taxi drivers, airline professionals, and travel companies.
So they were seeing increasing use by commercial users. Sounds like a ripe opportunity to start charging for such access.
Further, the data sometimes is bad and causes inaccuracy issues for customers without him knowing, this causes lots of complaints that he has no control over, something that isn't feasible when charging money to commercial users. Not just that, but the price of data is ever increasing, free data is becoming restricted and he needs to restructure as data suppliers go out of business or restructure their API.
I mean there are obviously solutions, like generate his own data etc. But it really looks like he's got other opportunities to earn a living and this isn't the lowest hanging fruit for him.
What I DO find strange is why he's not selling it. I just can't imagine not at least one of the company's he's buying data from wouldn't buy this at a discounted price if need be. Some money is better than nothing.
Winners tend to turn challenge into profit opportunities rather than give up and disappoint many people when they had something sizable which could be sold to someone whom can fix it or fix it themselves.
Too often, when people whom are uncomfortable with uncertainty and don't know what success looks like, they give up and throw away opportunity which may never come again because of their past behavior / reputation for not finishing things. My cousin nearly had a florist shop by having tons of orders, but gave up when he didn't know what to do by feeling overwhelmed... and I was so disappointed that he didn't handle it better to come out ahead in something he had passion and opportunity that passed by. (Self-sabotage or novice mistakes, who knows.)
I see these shutdown notices not as some self-deprecating contrition but as braggging about letting people down, destroying value and wasting their and all their customers' and investors' time and money... don't shutdown when you have a good team and customers, pivot or sell. (Don't squander assets: talent, social or capital.)
This jumped out at me:
"...Just Landed has outlived several of the services that it originally depended on, and each time a service provider has disappeared..."
This statement refers to the less than 4 years old app, which speaks volumes about value proposition of for-subscription-cloud-based APIs. Just Landed is a relatively simple, focused app built by a small team, yet in this short time it has suffered several (!) hits from disrupted availability of the API providers.
How can one expect to build a big business based on considerably more complex software using such APIs?
Compare that to the pains Microsoft has historically gone through to keep ABI compatibility with decade-old systems. I even have doubts about long-term availability of half of AWS services.
Kudos to John for running Just Landed for so long.
On the other hand, if you want a great example of how to do it right, salesforce.com has a pretty great API strategy. rather than try for some "version-less ideal" API, they release new versions and new endpoints, and have only ever deprecated old APIs for security reasons.
I suspect that when APIs are changing all the time, it is because the API's implementation is too close to the underlying application or data structure. In an ideal state, the APIs are only supposed to present data in a certain way, and shouldn't necessarily be determined by the actual structure of that data in an application or database.
Just some thoughts, maybe it doesn't apply.
Our company shut down because other people didn't innovate enough, not our fault.
"An app like Just Landed relies on access to high quality flight data to function correctly. "
We created an app based on data that doesn't exist. Not our fault, somebody else failed to create that data.
"Traffic and mapping data in particular, much of which used to be free, has become quite expensive, and is now tightly controlled by big companies under oppressive Terms of Service."
Other companies refuse to give us free services, and want to keep their valuable data restricted under oppressive terms of service. Not our fault, how could we expect that people wouldn't give us free stuff?
"These power users consume 100–500 times as much flight data per year as casual users, and so the cost of supporting will soon begin to overwhelm revenue from new app sales."
We failed to price the app correctly, since we're charging a one-time fee for a continuous service, but hey, not our fault again, who would have thought that people who buy our app would use it?
"Essentially, there’s a massive oversupply of apps, and the app markets are now saturated and suffering from neglect and short-term thinking by the companies who operate them."
There's too much competition! Seriously, it's all the competitor's fault, lowering prices as if there's no tomorrow. How can we be expected to make money with such cutthroat, dog eats dog competition?
Seriously, what a completely lame excuse. [Edit: that was unnecessarily harsh, my apologies]
Sorry for my rant, I guess I'm in a bad mood today.
A little harsh. 'Not our fault' and 'beyond our control' are not the same.
I read the reasoning to be a more pragmatic appraisal of the predicament they found themselves in - "Just Landed, ... has been on the wrong side of these trends"
But on the other hand, the key failure point for the app is pretty obvious: its revenue is a one time fee, and the costs are a function of how much people use the app. Based on the post, they clearly mispriced the app, since it depended on new sales to fund existing customers.
This isn't very different from a pyramid scheme (without the intention to fraud, naturally): you need to keep growing indefinitely to stay afloat, clearly impossible. When sales flattened (which they did) the company would go bust (which it did).
Another way to look at this is treating a sale as an annuity. If I sell an app for $10, expecting users to use it for 10 years with a 10% WACC, this would be equivalent to receiving a $0.13 subscription fee from each customer over the 10 years.
Therefore, if your variable cost per customer is higher than $0.13/year, you're in serious trouble. Even if it's lower, you might still not break even.
Either way always an interesting write-up. I do find it odd that so many in SV use the term "sunset" when their company is shutting down. Seems like a weird spin.
You just plugin the Stripe SDK and set up a Stripe account and it's done. It's not hard. It takes like half a day. You don't have to do any of this manually. If you're a tiny team and you are doing this manually you're doing it wrong. I've never had to worry about chargebacks or cancelations being a problem.
You would think that the consideration of "how will people actually use this application if we're successful?" would come up a little earlier in the design process than four years after implementation and deployment. And yet…
They might like that it implies more of a gradation than a binary on/off. A lot of these companies do help people migrate, etc. before going completely offline.
The time of the freebies for web-development is going to be over soon . I wouldn't trust any service, from Github to google API A or B, to remain free for ever. Especially Github which is moving to "enterprise" at a fast pace. As for PaaS or Saas, given how many businesses closed last year, the remaining offers will certainly get more expensive and any free tier discarded.
But the initial issue is certainly the business model. If you can't even pay for hosting anymore, you need to raise prices. A one time buy wasn't going to cover all the author's expenses.
For companies that offer a "free" tier (e.g. Bing/Google maps), for sure, sooner or later, a switch to paid is very likely.
But there are organisations that have a completely different justification for existing: OpenStreetMap springs to mind, as does the UK's Ordnance Survey (which is essentially a Government body, albeit cloaked as a private company, 100% in public ownership). Although they'll always need some source of funding to keep operating, their goal isn't to maximise possible revenue, so as long as it's viable to offer free mapping, they're likely to carry on doing so.
Real estate data is similarly messy and though we have a small engineering team (3 full-time programmers), we decided to roll our own data integrations with each of the MLS systems we connect to. For us, it came down to the fact that we could provide a better user experience this way (faster, more complete listing data) and that it fits with our approach to product development. Rather than using a data middleman to turn on 50% listing coverage across the entire US, we pick a city or region and piece together all of the listing sources so that when we go live in that region we have extremely high coverage. We then only advertise to users in those areas.
In a sense, platform APIs allow the platform owner to understand what customers want without needing to deploy product talent to deploy it. Twitter has perfected this strategy. As soon as a third party comes up with a neat idea with your API, you can build your own "official" version of their app, throttle their usage and hopefully their business model.
The dependence on third-party services like maps, messaging, flight data, etc. is an interesting topic. Services that help you to get up and running in a couple of clicks are awesome at first. But they can become a burden when your usage goes up beyond a trivial amount. This is a great lesson about thinking ahead when choosing third-party providers - either by passing the expense along to your customers or having a roadmap to phase them out when you hit a certain volume.
Another point is the one-time pricing which, in my mind, is somewhat of a ponzi scheme for a business model. I always cringe a little when I see a cool new app with a "one time payment for life!" pricing. You just can't support customers forever with a single lifetime payment unless you are earning revenue in some other way (i.e. advertising). It's easy to think that you'll continue to gain more customers forever, but you're setting yourself up to be crushed by your own success. Unless you're planning on regularly releasing new apps and/or in-app purchases for your customers to purchase, it's not a long-term business model.
Sorry to see the Just Landed go - it looked like a cool app. I think there is a lot to learn from this post so thanks to the author for posting.
In practice, for a good app the lifetime benefit to users vastly exceeds what anyone would reasonably pay upfront. For example, I've paid hundreds of dollars to Dropbox over the years (and feel like I've gotten well over $1,000 of value)—but I would have totally balked at paying even $200 on signup.
You don't use the marketing channels you wish you have, you use the ones you can make a profit off of. If you have to ask, they probably won't reach you.
I didn't read about funding in the article, but outside of $ a VC or Angel will provide a network and path to solve GTM challenges AND get you in front of the right people for an exit.
I'm sure if this app called an Uber/Lyft timed to plane landing it could find a home...
Is this true? Is the app store deceiving developers by pretending that earnings are better?
You might be surprised to know that many customers on the App Store, and even some members of the press, seem to think that apps being featured by Apple have been bought by the company. I would get emails like: "how have things changed for you since Apple bought your app?"
If people knew how bad the app economy has become, there'd be far fewer app developers than there actually are, and the device makers would have a serious PR problem on their hands.
In the end though, I do believe that the short-term thinking I alluded to in my post will soon come home to roost. I do hope that Apple and Google course-correct before we end up in a situation where indie apps are a distant memory. It's in their long-term interest to keep the App Store diverse and the app economy healthy.
The ending of "Project Astoria" that could have let some Android apps run on Windows 10 Mobile has undoubtedly hurt Windows Phone because of the dearth of good apps, but that same lack means that a quality application could still be a smallish fish in a small pond rather than a minnow in a large lake - even with the disparity in adoption 1% of the smartphone market is a significant number of devices. If an app is also something that's viable as a desktop or tablet app, that may provide enough of a larger market over time to keep some folks in business.
As with anything in Travel outside of actual aviation aspects these types of services such as just landed, to me, feel more like Value Ads than core products. I personally just use google to track the flight of an arrival and can do it from my phone's browser by typing the flight number in a google search box.
Do these middlemen have to strike deals with the various airlines, or are they simply accessing public APIs that generally stink? What order of magnitude, cost wise, do these airlines charge in the deals? Could I, $random_guy, make a deal with $random_airline, for an amount that is sustainable without any special kind of funding?
[1] https://en.wikipedia.org/wiki/Automatic_dependent_surveillan... [2] http://flightaware.com/adsb/piaware/build [3] http://flightaware.com/adsb/coverage
Our network ADS-B ground stations is one of our fastest-growing data sources, but we also get data from the FAA, other national aviation authorities (UK, Australia, Eurocontrol, Central America, etc.), directly from airlines, satellite avionics providers, etc. Live flight tracking is a deceptively difficult problem - on the surface it seems as if you could simply collect data and regurgitate it (that's what I thought before I came onboard), but there is actually an enormous amount of processing and inference based on sometimes incomplete, inaccurate, and conflicting data, even for mainline airline flights. That's not even getting into GA or flights in areas of the globe where we lack complete coverage. It's a really interesting set of problems!
I'm guessing FlightAware is one half of the "duopoly" spoken about in the submission.
Edit:
Looks like the cost per 1k queries for flight arrival times is $7.90 USD, which is a Class 2 query @ $0.0079 USD per query at the highest tier [0], but it goes down with more queries. You actually also probably want to pull their "AirlineFlightSchedules" API data to pull initial schedules for the day, which is a Class 1 query @ $0.0120 [0].
How many flights globally, per day? ~100,000 [1]. Once you fall down into their tiered pricing, and use their "15 results per query" rule, it amounts to ~$80. Once there is flight information for each flight for the day, there will likely be periodic update times. There's a firehose feed, but they don't specify pricing, so I'm not sure what the cost is to provide live updates.
If we say 5 updates per flight (total guess), that becomes ~500,000 queries daily of Class 2 data. I'm confident there's a way to batch these, so this comes down to ~33,334 requests, which puts us at ~$181.34 in additional charges per day.
So our daily costs are now about ~$261.34, or ~$7,840.20 per month, assuming they're not pulling data on-demand. This changes somewhat significantly if an app (correctly IMO) only pulls data for flights it's asked about. You get to cut out the $80/day entirely, and only some portion of the $181.34 is actually paid each day. If you consider the ~28,500 domestic flights in the US [2], and if app users only search for half of those, costs drop to ~$162 per day, or $4,860 monthly (plus the unknown cost of the firehose).
So, because of the cost of the data alone, your app will have to pull in a bunch of users. Wait, how many? Let's figure that out, based on an estimation strategy I pulled off of Quora (so it might be wrong) [3]:
Each user checks their flight status 3 times, which takes them ~1 minute overall to read, so we get 2 impressions [3]. I don't really know what these other two things are, but I guess we'll next assume 100% fill rate and eCPM of $3. But that's just per flight. 694 million passengers took flights in the US this year [4], and while I know we're getting into some pretty speculative territory, that's at least 2 flights per person per year, not to mention all the other people who also check on flight statuses of their friends/family. I feel comfortable saying that each person would check this app at least 15 times a year (you'd use it if you had it), or 0.04 times a day, which would give 0.08 impressions per day.
Our calculation is now:
(0.08n / 1000) * $3 * 1.0 = $0.0002n
$0.0002n = $162
n = 810,000
[0] http://flightaware.com/commercial/flightxml/pricing_class.rvt
[1] http://www.garfors.com/2014/06/100000-flights-day.html
[2] http://sos.noaa.gov/Datasets/dataset.php?id=44
[3] https://www.quora.com/How-much-ad-revenue-can-be-expected-per-100-000-downloaded-iPhone-iPad-apps
[4] http://www.transtats.bts.gov/With more aviation geeks out there supplying the data, people won't be reliant on centralized sources of info.
http://www.aopa.org/Advocacy/Air-Traffic-Services-,-a-,-Tech...
https://flightaware.com/adsb/coverage#data-coverage
https://flightaware.com/adsb/piaware/
With a bit of promotion your idea could work and in fact... It does!
http://global.adsbexchange.com/VirtualRadar/desktop.html
Also, ADS-B rollout isn't entirely necessary. It's possible to triangulate places with the older Mode-S transponder through MLAT as long as you have enough receivers in the area.
Even the "leader" in this kind of app -- TripIt -- has basically been reduced to a free giveaway for users of Concur's (owner of TripIt) corporate travel booking platform.
You may say "ah but the good developers wouldn't do that" but unfortunately someone's always gonna piss in the pool.
The current buy-once model is better. Subscription/IAP model is better for something like this.
That's... how it's ALWAYS been. They can even do that now by just launching the new version as a separate app and removing the old one.
Is that a problem for anyone other than the app developer? It doesn't seem to be any loss to either the end user or to Apple for them to keep running Fart Simulator 2014 forever. If the app developers actually need all their users on the latest version, then they're incentivized not to charge for updates (or to do so in a reasonable fashion).
Talia, is that you?
--
"An app like Just Landed relies on access to high quality flight data to function correctly. However, since the airline industry is extremely fragmented, and uses antiquated IT systems and many incompatible data formats, it is not practical for a small independent developer like us to negotiate data-sharing contracts with each individual airline, and then unscramble their jumbled data feeds into a usable format at a reasonable cost."
E.g. Google for CX5992: https://www.google.com/search?q=cx5992
It's flawed because as an app developer, you don't have a way to tell if the app hitting your servers is legitimate or not. Just counting:
(sold copies) - (unique hits on our server) = pirated copies
What about reinstalls? What about developers/tinkerers who are probably flattening their devices on a regular basis? What about one person with multiple devices?
IIRC Google gives you access to all that information in the Google Play dashboard, and for my apps, "reinstalls"/device upgrades were very rare.