AppHarbor’s new pricing, what I would have done

AppHarbor,Cloud 4 February 2012 | 1 Comment

As per my previous post on AppHarbor’s new pricing structure and charging each application $10 for a custom domain, several ideas have been swirling around in my head (most of them I posted to their announcement in the comments).

Option 1: Reduce the free ride

The free instance (now called a worker) and application of past days is too much of a good deal. This could easily change to continue the free tier without having to start charging for the custom domain. The main problem is the perception that the $10 is just for a domain name, you need to sweeten the deal.

I propose introducing the concept of a free tier, the current free worker of the past but with these limitations.

  • Lower the caps on bandwidth, processing power, ram and storage.
  • Lower the speed of builds.
  • Lower the speed of deploys.
  • Limit the number of deploys. (e.g. 4 per hour)
  • Lower priority on load balancing.

The free tier would still be viable for small websites, MVP products and startups as they wouldn’t run into issues until they get popular.

The next tier up is then $10. For $10 you basically get all the priorities put to normal (as they currently are) but still only 1 instance.

The tier/package after that is 2 workers plus as normal.

These are just a few options for cost saving on the free tier and making it a better deal to upgrade to a paid tier. Currently its just a domain name, you need to make people feel they’re paying $10 for lots of benefits.

Option 2: Make the $10 for all applications

It’s quite simple. You make the $10 unlock custom domains for all applications that the person hosts. For most people this seems like a good deal, as the more applications you host the cheaper that $10 is.

Option 3: Reward those already paying customers

It’s quite simple again. If you have a customer that is actually paying for an addon or additional workers on their account. They get custom domains for free. E.g:

  • User A has two applications. Application A is 1 worker and no addons. Application B is 1 worker with the $10 SQL Server database. User A gets custom domains for free.
  • User B has three applications. Application A & B are 1 worker and no addons. Application C is two workers. User B gets custom domains for free.

Option 4: Figure out the actual price

The more worrying thing about the new pricing is that the AppHarbor team don’t know the actual cost and $10 seems an arbitrary number.

We kept the price of a custom domain low and we do not intend to make money from it. In fact we plan to donate any profits generated by custom domains to open-source projects and charity!

This strikes me as strange. You’re introducing something that is bound to be unpopular but you don’t want to make money off it and you’re not sure what it’ll cost you? You need to try and monetise your service not try to reduce your client base. But it’s OK guys, we’ll donate the rest to open source and charity. I already support projects I feel are helping the community, I’d rather you figure out the price rather than make me support projects you feel are helping the community.

Conclusion:

In one day of thinking, I’ve come up with several ideas that they should consider. If they go down their current route of charging $10 for each application to have a custom domain, I fear their customer base will shrink. Sure they’ll probably loose a few who were just on for the free ride but this announcement has damaged my confidence in using AppHarbor.

One Response on “AppHarbor’s new pricing, what I would have done”

  1. friism says:

    Hi Phil, thanks again for writing up your thoughts.

    We are committed to including a free offering in our selection of plans. We also want to make sure that people trying out AppHarbor on the free plan get full and un-filtered access to what we think are the most important parts of the AppHarbor value proposition: Convinient and quick deployments from source control and fast and reliable hosting. Those are things we will never compromise on.

    We definetely value you feedback and are always on the lookout for ways to optimize our plans and pricing.

    Michael

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