Is plugin market going down?

[Terrafractyl]

Do you always do what Apple, and Google tell you to do?? To me that is even worse. The way people just fall in line with the system, despite knowing that it is wrong.

When a critical mass of stupidity is reached in a population otherwise intelligent members of the population are forced to behave stupidly in order to survive. It cannot be justified rationally. That's the power of stupidity

Lol

Well it just seems a little stupid to be saying, 'I can't be bothered paying for digital goods type A, because I don't have to anymore, but I still expect everyone to pay for digital goods type B'.

Actually I'm kinda liking the Irony here, considering that came from a Developer on a 'music tech' forum. 10 years ago the roles would have been reversed for sure!

[Urs]

However, the thing that created this plug-in business ecosystem - globalization through the internet - is currently targeted a lot for political reasons in various countries, including two major markets (UK and US). I see a risk that, in a few years these markets may be more difficult to enter with otehrs to follow, i.e. by restrictions to internet payment and data transfer. Now that might make things ugly.

Did the mandatory VAT requirements hurt business ?

I like VAT/GST, because of its fairness it's preferable over many other forms of tax. Unfortunately it is also a form of tax that has an impact on sales, particularly if it varies from A to B.

[ghettosynth]

Subscriptions, bundles... Prices ARE falling. Several years ago I remember an equaliser was on sale for around 1000. Today the market is willing to pay..15? Maybe 29?

Isn't that slightly oversimplified? How many $1000 licenses did one sell back then? 2-300 maybe at best. Not the tenth of thousands you can reach today with adequate pricing.

It's not that products lost value, it's the fact that we had a radical shift away from B2B were ppl are used to declare their costs as expenses (costs really don't matter) to B2C were ppl can't do that and generally operate at a much smaller scale, often without any professional ambitions. The amount of DAW users literally exploded over the last years and still does. The banal issue is that these guys can't declare their costs as expenses. But the advantage is, they come in masses.

IMHO, the overall market has a healthy growth. But a much different one compared to the first wave of audio system "digitalization". It's probably this transition so many companies struggle with (to be clear, I think Voxengo has a perfectly OK pricing, the recent super bundle offer is quite cool).

Yes, exactly. However, if you want to sell into this market you will start to realize that previous perceptions of "good value" are also starting to shift. Prices that in the past were viewed as "no-brainers" are not so much anymore.

So, while in a sense, I agree that there's nothing wrong with Voxengo pricing, it remains that they aren't low enough individually to soak up that disposable income that, e.g., I'm giving to Waves instead. I'm not talking about the bundle, on an average cost basis, that's competitive today.

As another example, consider Valhalla, great products, more than fair prices, but, how many reverbs actually cost more than $50 today? I know that it seems at first glance that most probably still do, but, many have gone on sale for less than that over the last few years.

Even those of use who are acutely aware of all of this and think of ourselves as rational buyers, are still subject to the psychology of marketing. However, this is especially true when you are dealing with consumers who make their decisions more on desire than on utility.

I've purchased one reverb that wasn't on sale, that was R0verb by Klevgrand. That's because it was basically less than the cost of a pizza, and I wanted it. If I had waited, I could have had it for less. Truth be told, I probably should have, I don't really use it that much, but, I'm not really all that concerned about it. I waste pizza money enough that I don't care.

Please don't suggest that this is just "my use case", if you're paying attention at all, you will realize that this "use case" is as old as the hills and as common as dirt. It's exactly what's at work in the music industry. People do pay for digital downloads, as long as the price is about the same as a candy bar.

If you don't want to do sales, then don't do them. However, don't get mad when you finally realize that the value of sales is in getting more money to flow in the economy than would otherwise and that none of that money is flowing to you.

[Zaphod (giancarlo)]

Subscriptions, bundles... Prices ARE falling. Several years ago I remember an equaliser was on sale for around 1000. Today the market is willing to pay..15? Maybe 29?

Isn't that slightly oversimplified? How many $1000 licenses did one sell back then? 2-300 maybe at best. Not the tenth of thousands you can reach today with adequate pricing.

It's not that products lost value, it's the fact that we had a radical shift away from B2B were ppl are used to declare their costs as expenses (costs really don't matter) to B2C were ppl can't do that and generally operate at a much smaller scale, often without any professional ambitions. The amount of DAW users literally exploded over the last years and still does. The banal issue is that these guys can't declare their costs as expenses. But the advantage is, they come in masses.

IMHO, the overall market has a healthy growth. But a much different one compared to the first wave of audio system "digitalization". It's probably this transition so many companies struggle with (to be clear, I think Voxengo has a perfectly OK pricing, the recent super bundle offer is quite cool).

Tenth of thousands means "support"
In a market where the typical company is composed by 2-3 guys this could be an issue. Just for being compliant to moss rules it could be a challenge. Following your rule a lot of companies should have at least 20 employees, but this is not what I see.
By the way, we are doing b2b too, and we have 2 ppl full time just on it

The other problem I see: everything is good if the company has a decent visibility, because those prices are a serious issue for beginners - and also if for somewhat reason you stop selling, i.e. sudden competition from someone else

The last problem, you reach those numbers if your plugin is perfectly in the middle of expectations: light on cpu, simple, streamlined an so on. I can assure you we cannot have easily "tenth of thousand" because our cpu load is greater than the typical one. In our model for example we have less customers with a greater price (fewer people but ready to pay more because other achievements).
Now: being in the middle of expectations works but you have constraints. Following those constraints the risk of competition is high, and getting visibility on new products is harder and harder. This situation is very visible on forums: products receive hype for a limited amount of time and the situation is worse and worse. I see companies releasing a new plugin and getting hype for 10 days, even less. Before the hype was for months. Our nebula got hype for years.

[ghettosynth]

The last problem, you reach those numbers if your plugin is perfectly in the middle of expectations: light on cpu, simple, streamlined an so on. I can assure you we cannot have easily "tenth of thousand" because our cpu load is greater than the typical one. In our model for example we have less customers with a greater price (fewer people but ready to pay more because other achievements).

So, the BetaMax of plugins?

[Zaphod (giancarlo)]

and YouTube told me everything is completely free.

Free, but crap audio quality.

Music on youtube is like plugin demos with beeps or audio fallouts every 30 seconds.

If you really like a track or album, you want to get it in better audio quality than YT.

Man, maybe you don't realize it, but let me tell you what is happening. Each 5 days I grab the ssd memory I keep in my car and place it in my notebook. This is the most hard difficult part of the work.

Then I launch YouTube, where there is an extension with a button and I get an mp4 in a folder. I just search all songs I have listed in shazam. That button comes from a script, the most used script ever downloaded in a computer. I think millions of ppl have that button, or maybe hundreds of millions. We are not speaking about BitTorrent or similar "illegal" garbage, because this one cannot be tracked in any way. The script is a very common add-on, downloading it this is perfectly legal. I'm still struggling trying to understand if the whole operation is legal or not because basically I'm downloading a legal script and I'm just storing in my device what I hear. This is not more illegal than using a cassette deck in 80s and grabbing music from the radio.

Basically I drag&drop those files to the memory card. I can assure you, quality is VERY good. This is not 2005 any more. Quality is better than apple itunes ac3 in most of cases. When I buy the wav version (using a lengthy procedure based on login, credit card, billing) I receive something which I cannot recognize as "better" in my car. Maybe you know already, I'm decently skilled on "audio quality" and believe me, I cannot hear it in that environment. Most of time for dance music I can't hear a difference in my focal loudspeakers.

Now: next step, new cars generation will have directly YouTube. The end.

[ghettosynth]

and YouTube told me everything is completely free.

Free, but crap audio quality.

Music on youtube is like plugin demos with beeps or audio fallouts every 30 seconds.

If you really like a track or album, you want to get it in better audio quality than YT.

Man, maybe you don't realize it, but let me tell you what is happening. Each 5 days I grab the ssd memory I keep in my car and place it in my notebook. This is the most hard difficult part of the work.

Then I launch YouTube, where there is an extension with a button and I get an mp4 in a folder. I just search all songs I have listed in shazam. I don't think this is "legal", but trust me, that button comes from a script, the most used script ever downloaded in a computer. I think millions of ppl have that button, or maybe hundreds of millions. We are not speaking about BitTorrent or similar "illegal" garbage, because this one cannot be tracked in any way.

Basically I drag&drop those files to the memory card. I can assure you, quality is VERY good. This is not 2005 any more. Quality is better than apple itunes ac3 in most of cases.

Now: next step, new cars generation will have directly YouTube. The end.

However, this is where the music market is not the same as the software market. Music can not be both made available and also protected against copying.

[Zaphod (giancarlo)]

The point is the perceived value of a good. I'm a musician, and today in my mind a song price ranges from ZERO to 0.99
I can tell you I perceive it as 0.10
This price is obviously not sustainable for music business. When YouTube will be a standard in my car (maybe with a cool "record" feature coming from the car) the perceived price will be perfectly zero

This model is good for the distributor (youtube), not for the content creator (artist+ engineer+ ...). Race to the bottom is never a good thing

[Aleatoriac]

However, this is where the music market is not the same as the software market. Music can not be both made available and also protected against copying.

In the current situation I am compelled to agree with your assessment.
Add quantum encryption, VR/direct neural link to data and I think that will change. But for right now, being a musician is almost certainly (almost) not going to be profitable no matter how "good" of a musician one is.

The stupidity of it is that people want more and more music, and the very methodology used in satisfying demand is slowly destroying supply.

The Humans will be absorbed.

[ghettosynth]

However, this is where the music market is not the same as the software market. Music can not be both made available and also protected against copying.

In the current situation I am compelled to agree with your assessment.
Add quantum encryption, VR/direct neural link to data and I think that will change. But for right now, being a musician is almost certainly (almost) not going to be profitable no matter how "good" of a musician one is.

Right, until we bypass the ears, which I'm sure will eventually happen, Apple is getting ready for it by eliminating the headphone jack, we will be able to copy music.

At any rate, software doesn't behave that way so I'm not exactly sure what all of the doom and gloom is about. One should always be thinking about adaptation to new market conditions.

The stupidity of it is that people want more and more music, and the very methodology used in satisfying demand is slowly destroying supply.

The Humans will be absorbed.

To be clear, I do still buy music, but not as much as before the days of viable streaming. However, I'm not sure how my personal model adapts. I buy music that is similar in style to what I create. It's not mainstream, and it's generally not on youtube. My own music isn't on youtube either, but, of course, you can copy it off of bandcamp if you want to. Honestly, I don't really care, if I did, I just wouldn't allow streaming.

The music that I buy is on bandcamp and I only want to buy it off of bandcamp so that it's in my bandcamp collection. I don't even think that I downloaded all of my purchases TBH.

The people that I buy music from are largely in a similar state, they're certainly not making a lot of money off of their music. I don't see any of this having anything to do with the "music industry" really.

[aumordia]

People have less disposable income than they did pre-2008, and the novelty of "OMG look what I made the computer do!" is starting to wear off. Bing Crosby recorded the immortal "White Christmas" in 1941 using technology that can't hold a candle to a netbook. You don't need much to make great music, and people -- producers and listeners alike (increasingly, these are the same people) -- are getting wise to this. The rise of synthwave is a harbinger of these to come. If you're in the business of selling the "much" that people don't really need, I'm not sure what to tell you.

I suspect that the trend will be toward things that objectively improve "workflow" or remove friction, however you want to think about. Stuff along the lines of those Dada life plugins, or Serum (thinking about the UI here). I also predict that ultra-real emulations of this analog synth and that mix desk and whatever are going to decrease in popularity, because none of that stuff really matters, and most producers these days have never even seen an SSL desk.

Voxengo: if I'm right you can keep making butt ugly stuff so long as it fits the parameters above (I don't think anybody would call the Sausage Fattener a looker). Maybe give that a shot? Probably more fun and experimentally useful to create a plugin along these lines rather overhaul the UI for your entire website and product suite.

[aumordia]

Take this for example:

https://www.youtube.com/watch?v=Z4EzP9chIoA

Great tune, made with a tracker and ancient plugins. It doesn't take much -- and woe betide the sellers of the "much" as this becomes more broadly recognized.

[PurpleSunray]

Now: next step, new cars generation will have directly YouTube. The end.

Nah, you need to switch off video playback when car drives (by law - car may not do that). So video streaming is not relevant, maybe for rear-seat. The idea to only play the audio but not render video did not found any friends so far. But Spotify, Deezer, Tidal & co is a must-have on almost all new projects. In about ~5 years there will be no more new car model that does not have it.

And I think that is a good thing.
Those services focus on selling permium accounts instead of giving all away for free. Artitst / Lables benfit from that dollars too and you get way better audio quality than on youtube.

[camsr]

the novelty of "OMG look what I made the computer do!" is starting to wear off.

Possibly, but I think it's more like "OMG, look what my computer can't do!" that's stifling the plugin market.

[aumordia]

You can break the consumer market down into nerds, bros, and dabblers.

The nerds are relatively few in number, but they are loooouuuuddd... on the internet. They make up the bulk of the membership at places like KVR. Nerds are generally motivated by having whatever is technically the best. In the early days of plugins, there was a lot of debate about what was "best," and it was a moving target anyway, with rapid advances in both hardware and software. These days, "best" is starting to converge on a few usual suspects, depending on category: and if your plugin is not the BEST -- not merely very good or excellent value for money, but the BEST -- the nerd won't pay attention to you. This is a tough market to compete in, and the direct rewards are relatively small -- but if you do win them over, they are a reliable income stream, so long as you keep producing the BEST stuff.

Bros are all about results, as measured in quantity and quality of "fly hunnies" who smash that like button on YouTube, or the number of plays on Spotify, or their beatport chart position; etc. You need to approach marketing to the bro the same way you approach marketing to another business: how will my product impact your bottom line? Unlike the nerd, you can't simply hand them the most capable tools -- you have to give them something that will give them maximum results for minimum fuss. Bros tend to rely much more on IRL word of mouth, so if your thing doesn't really improve their ability to crank out bangers, you won't succeed. On the flip side, you don't actually need to be the best in a purely technical sense, you just need to find a way to improve their ability to get a desired result (usually by saving them time). Bros tend to think in terms of "good enough" when it comes to tech, so you have more ways to compete -- your tech might not be the best, but you can undercut on price, offer better ergonomics, or solve boring workflow problems that nobody else is paying attention to. The bro market is much bigger than the nerd market, but perhaps harder to reach -- you can be #1 on KVR but basically unknown to the bros because of the IRL focus.

Dabblers are the people who are most interested in whatever is shiny, new, and cheap -- ideally available on a torrent. This is the circus, and success here boils down to the show you can put on, and how you can make your users feel while using your products. If the nerd wants to have the synth with the most sophisticated analog modeled filters, and the bro wants the synth that will help chart higher and more easily on iTunes, the dabbler wants the synth that his favorite producer said he used in an interview -- especially if it's on sale! This is far and away the largest market, but also the cheapest and most frivolous. You can sell them basically anything if you go viral and the price is right (or they find a link on the Pirate Bay).

There's a long tail of other categories, but these groups cover 80% of what's out there. There's some overlap, and of course these are generalizations, "you can't just label people maaaan" blah blah blah.

Anyway, I sell software for a living, but in a different industry, I'm just trying to offer some perhaps helpful perspective. I looked around on the Voxengo website, and it seems clear to me that it's competing in the nerd category, but it's not clear that his stuff is the best. So one option we be to start making stuff that is clearly, by objective measures, the best. Not sure the juice is worth the squeeze on that one.

Another option would be to pivot to the bros. Voxengo tech certainly looks like it's good -- now what unsolved workflow problems can it be used to solve? Look at the new "endless smile" plugin by dada life -- a clever little thing. It was developed for them by another company. Voxengo, maybe you could be a company that does that sort of branded development? Or maybe you could take a look at your existing plugins and say "hmm.. how can I rejigger some of these so that they tangibly improve workflow in a way that nothing else on the market is?" This may or may not be easier than trying to win over the nerds, depending on how your brain is wired.

As for the dabblers, well, that's where your 4000 reverb downloads are coming from. You could hire a UI guy to give your whole brand a facelift and rebrand some of your free stuff as "new and improved deluxe edition for $99" and then have go in sale for $29 later. It doesn't sound like fun to me, but hey, it could be a living.

If I offended anybody: I will only acknowledge you if you express your angst in the form of a song and post it on SoundCloud for me to comment upon.