The Gong Show - Latest Comments in General

Re: Decision Making

andrewparker — Fri, 25 Jul 2008 14:08:07 -0000

Very interesting. I love the dialog in blogging!

Re: Decision Making

davidprice — Fri, 25 Jul 2008 13:01:44 -0000

Andrew, my subjective experience and observations are similar; however I think that there is a way for higher levels of consciousness to shape subjective, instinctive, heuristic decision making without shifting the locus of the decision from a sub-conscious to a conscious level.

The key (I think) is to provide a way for all of the pertinent considerations to be surfaced and made transparent to the individual decision maker (or all the individual members of a deciding group), so that the instinctive, sub-conscious decision flows from the richest possible understanding of the context of the decision.

In essence, this is one of the dynamics live in a successful mediation or conflict resolution process along the lines developed by the Program on Negotiation team at Harvard.

Re: Decision Making

Bob C — Tue, 22 Jul 2008 21:28:48 -0000

Those who follow the herd risk stepping in shit.

Re: Decision Making

andrewparker — Tue, 22 Jul 2008 20:14:09 -0000

We certainly do simplify all the time, but I don't think it is often done
intelligently. Most often (and this is David Brooks insight again) we
simplify based on the actions we observe our peers doing, and we do this
simplification unconsciously.

Intelligently formed heuristics (like taking the the theory of gravity for
granted rather than rediscovering it with every step we take) are great. By
contrast, heuristics formed simply by following the herd are a fact of life,
but a disappointing one.

Re: Decision Making

qdub — Tue, 22 Jul 2008 20:04:46 -0000

But heuristics are quite rational...we intelligently simplify all the time. Irrational thinking is a blatant ignorance or fabrication of visible facts.

On another note, the funny thing is that irrational thinking is simultaneously said to be "what makes us human" as well as "what makes us stupid" (it just depends on whether you're talking about who to marry or which stock to buy!)

Re: Decision Making

andrewparker — Tue, 22 Jul 2008 16:38:05 -0000

Totally agree. Heuristics are essential. I always thought it was so silly
how "stereotypes" are demonized in grade school. Stereotypes are essential
to survival. They serve a very necessary biological function.

Re: Decision Making

Julio — Tue, 22 Jul 2008 15:43:51 -0000

I kind of agree in theory but the problem is that all those "non rational" and "non logical" processes (biases) are heuristics. They exist because they work pretty well most of the time (on a global scale) and save us a lot of time. For any single decision there are (near) infinite relevant facts. If you really tried to consider them all you would have a hard time making any decision ... unless you started taking shortcuts (heuristics/biases) and filtering the information.

Re: App Store is a Solution to The Penny Gap

fredwilson — Sun, 20 Jul 2008 05:36:20 -0000

i guess it matters what price developers charge, but the vote that really matters is the decision to download and from what I am hearing, users are voting heavily for free apps over paid apps. i've asked Greg, in a comment on the Pinch Blog, for that data.

fred

Re: Retire This Analogy

qdub — Sat, 19 Jul 2008 17:32:21 -0000

I disagree strongly. Cost-based-pricing is not an economic fact, it is the terminal point of an industry that has been commoditized, or full of players willing to sacrifice margin for market share (largely due to Metcalfe's N^2)

It is every strategist's biggest challenge, to move a business away from cost-based to value-based pricing and I don't think any business could ever truly considered a cash cow if it still depended on cost-based pricing. Content and services are free or close-to-free today because there is always either a desperate competitor or pirate willing to offer it for free, and even the most solid product can't risk losing market share at this point in the game. Both of these problems will fade as the industry matures.

Re: App Store is a Solution to The Penny Gap

qdub — Sat, 19 Jul 2008 17:22:23 -0000

Penny gap is an important problem and I think the best people to solve the problem are those who already have a recurring billing relationship with the customer--e.g., telecom players. Unfortunately they have been completely out of this game.

Think about "overage" minutes on your cellphone plans. Every minute you go over you pay <$1, that's similar to a micro transaction and customers are used to seeing that kind of variability on their bills. With enough "training" people can get used to additional variability from app and content micro-purchases while maintaining the simplicity of 1-bill for telecom.

Re: App Store is a Solution to The Penny Gap

andrewparker — Fri, 18 Jul 2008 17:32:08 -0000

Ha, Apple's certainly got plenty of everyone's fingerprints (and a couple
key scratches too).

Re: App Store is a Solution to The Penny Gap

robzand — Fri, 18 Jul 2008 17:28:25 -0000

good observation. yet you still have to enter a password each time you buy an app from the phone version of app store. biometric instead?

Re: Best-Worst Movies

andrewparker — Fri, 18 Jul 2008 17:09:20 -0000

Ooh, good choice. Dav Chapelle was great.

Re: Best-Worst Movies

coreyh — Fri, 18 Jul 2008 15:31:13 -0000

#78 - Half Baked.

Re: App Store is a Solution to The Penny Gap

jasonoliver — Fri, 18 Jul 2008 14:43:34 -0000

Completely agree that the barrier for charging for apps has dropped tremendously on the iphone app platform. that being said, it will be interesting to see the volume counts for free downloads vs. paid downloads. people are clearly still at the point where they are just adding apps for the sake of adding apps (since many have not had apps on their iphone before), it is a great opportunity for app developers to achieve mass adoption. according to medialets, nearly 50% of apps are either free or $0.99 (and we already know most of the $0.99 ones are those ebook scam apps ie not real apps), and most of the download activity centers around the free apps. for developers, the fact that it is easier for users to pay for apps might not outweigh the fact that if the app is free, the distribution potential is that much greater.

Re: App Store is a Solution to The Penny Gap

innonate — Fri, 18 Jul 2008 14:24:15 -0000

Jason, you're right that the market still has to shake this out, but I think Andrew's most important point is that Usability and ease of payment is hugely at play here.

With one-click, app developers aren't afraid to put a price on their app, and that's important. As a web-app developer, you definitely should be scared to do that, because it's still a huge barrier.

Re: Retire This Analogy

julien51 — Thu, 17 Jul 2008 23:55:01 -0000

Hum, I disagree with this "Users expect software, music, and other digital goods and services to be free because they know it costs zero to copy and distribute the digital goods to them"...

We're not anymore in a "production-lead" economy, but rather a "market" economy where prices are set-up by the ratio "demand/offer" : the greater the demand compared to offer, the greater the price.

Your restaurant example is good and consumer will go the "cheapest" place, even if it is way above the actual "cost" of a cheesecake... I even believe that they do not really care about the actual cost of a making cheesecake! Same, your caveman wants to buy the cheapest of the available furs, whichever the cost to get them for the seller!

However, I would say the economy of dematerialized goods (music, software...) responds to another theory because the market theory holds only when the resource is "limited".; but which one?

Maybe it's simply due to the fact that listening to music is "simple", that downloading a software on your computer is simple... etc, and most of the time, people don't want to pay for things that appear "simple" (see this twit' : http://twitter.com/sacca/statuses/860432283 )

I would also say that "habits" play a great role... Our generation has been used to download music for free, but also ti use freeware, and it's hard to come back to a paying model, the same way it's hard to pay $4 for a gallon of gas while we could pay twice less 3 years ago!

Re: App Store is a Solution to The Penny Gap

naveen — Wed, 16 Jul 2008 22:53:27 -0000

great point - great way to look at it.

Re: App Store is a Solution to The Penny Gap

jasonoliver — Wed, 16 Jul 2008 19:29:06 -0000

wow surprisingly did not know that (although faintly remember hearing about this in the past). amazon prime and 1-click transactions have made me buy so much more random crap from amazon, that i would never otherwise even consider buying haha.

Re: App Store is a Solution to The Penny Gap

jasonoliver — Wed, 16 Jul 2008 19:26:32 -0000

hey andrew, nice post and definitely something good to think about. that being said, echoing a lot of the comments over at techcrunch, it's clear that yardley's analysis isn't that useful, because at the end of the day, it is an analysis of what iphone app devs decide to price their app, which may or may not be intelligent or strategic. also, i heard that most of the $0.99 apps are by a developer who took a bunch of free to read books and converted them into $0.99 click to read ebooks. when the data is available, would be much more interesting to see how many people are buying apps at each of those price points, and what categories those apps break down into. seems to me like early on, games will do pretty well on the retail front, but long-term, they have the best potential for ad-supported revs while utility apps that don't increase in value the more people use them, will be relegated to charging users up front to generate revs.

Re: App Store is a Solution to The Penny Gap

andrewparker — Wed, 16 Jul 2008 14:17:07 -0000

Very good point, totally agree. Hopefully Greg will stumble on this thread
and add input.

Re: App Store is a Solution to The Penny Gap

Fraser — Wed, 16 Jul 2008 14:03:31 -0000

Nice write-up. Alex and I were discussing something similar yesterday after reading Greg's post. I wonder though, if there is a bias to the stats from apps that people have traditionally expected to pay for (i.e. mobile gaming apps, etc.).

If you look at web2.0-ish applications on the app store only... what's the average cost?

Re: App Store is a Solution to The Penny Gap

andrewparker — Wed, 16 Jul 2008 03:52:09 -0000

Sounds right to me, totally agree. Also, sounds like a piece of usability.
User intent is setup by the metaphors you use to convey your interface. The
"store" metaphor is ideal for defeating the penny gap. A good metaphor is
essential to usability.

Re: App Store is a Solution to The Penny Gap

naveen — Wed, 16 Jul 2008 03:40:24 -0000

i don't think purchases are easier on App Store just because of the UI and the 1-click, although they play a role. i think the main reason is due to the fact that both App Store and Amazon started out as _stores_ (iTunes Music Store and Amazon Books, respectively). you've been going to both of these places for years to "purchase" something by forking over money, so free is only an added benefit. with web2 stuff, you go there for the content or the community -- it's never been about buying. if anything, your "purchase" on these sites is paid for by your participation.

Re: App Store is a Solution to The Penny Gap

michaelgalpert — Wed, 16 Jul 2008 01:37:03 -0000

Unfortunately Amazon patented the beauty that is the 1-click. Apple licensed the 1click from amazon back in 2000 http://www.apple.com/pr/library/2000/sep/18amaz... if I am not mistaken it went for $1B

I have always wondered how different the web would be if there were no 1-click patent