I believe today marks the day war was waged on the humble productivity app. We’ve been teetering on the edge for a while now. Open hostilities from Microsoft on everyone not named Microsoft and then Google on Microsoft itself meant a Cold War broke out. But that’s all it was: a Cold War. Google, after all, still charged businesses $50 per year to use its productivity suite. Apple, too, played in this game, once charging $80 and more recently $30 for its Office suite. The three sides faced off.
Today Apple announced that the iWorks suite will forever more be free. Couple this with iCloud sync and web versions of iWorks (all free) and suddenly the game has changed on productivity apps. We are now at war.
This is how good businesses work: make money on your thing and commoditize everything else. Apple makes money from hardware so it wants everything else to be free: syncing, back up, web storage, apps. Google makes money by selling us (ads) so it wants all software and hardware to be free.
Historically, as a developer, our priorities lined up nicely with the big player in the market: Microsoft. Microsoft makes money from software so it wants hardware and peripherals to be free. Since we make money from software, too, us developers have been in pretty good shape. Add in the fact that Microsoft primarily sells productivity software and us productivity app developers have done really well business model-wise .
But the market has shifted. Apple and Google are the top players now and their priorities don’t align as well with ours. Neither store offers upgrade pricing, both emphasize low prices and neither does a good job of enabling recurring business models.  And making money from productivity software has just become a little harder with Apple making their word processing, spreadsheet and presentation software free, available on the web, on the Mac and on the device, and syncing between them. Those are amazingly complex and powerful products.
Where does that leave developers of fine productivity apps? Clearly fighting an uphill battle. Adjust your businesses accordingly.
 Except, of course, when we got stepped on. That happens in all businesses.
 Yes, Apple offers subscriptions for newstand apps but not other applications. Plus the 30% charge is really high for annual subscriptions.