robussc wrote: ↑27 Mar 2023
Monosnap gross margin on software - Google Search 2023-03-27 16-28-52.png
Most businesses would kill for that kind of margin!
Note that he's saying a "good gross margin" for "companies he works with".
While most businesses would kill for that margin, the economics are completely different to most businesses (which is why they're not doing SaaS).
Software companies go out of business, or struggle to get enough sales to grow their team (hence the many complaints of RS being slow).
But the key thing is that the success of SaaS doesn't make perpetual licenses just as good, nor do the margins of the companies Monosnap work with give any indication of this market.
Waves do seem to be doing well (no idea of their margins though).
But then Twitter runs at a loss. It's not all peaches in the software world.
In any case, music software companies face a very pressing problem. We're reaching the point of diminishing returns when it comes to instruments and effects, and it's not as easy to just release a product with more processing power as you can with hardware, as it's all done on the user's CPU.
Roland Cloud is largely based on hardware and sounds that are over 25 years old, and yet it's still relevant today. I doubt anyone would be left behind if they never upgraded for the rest of their life.
I was amused in 2008 by my friend's insistence that his Roland rompler (either a JV or XV series) with a few cards is all he'll ever need.
I get where he's coming from now.
While I have bought lots since 2006, I almost felt the same about what I had back then (but was still trying to figure out how to get the workstation sound).
It's funny, I see some long-time users criticizing R+, but then see some new users feeling blown away by its offering.
I guess there's a reference point we all make with what we think is all we need for our desired sound, and anything beyond that, no matter how impressive is ignored. After all, what's a new synth to someone who samples? And what's a modelled piano to someone who just needs 90s digital piano sounds?
Of course, I don't know their financials or the innards of this market, but there's an impending point of diminishing returns and market saturation ahead. And the way music software has been sold for the last 25 years might be due for retirement any minute now.
Maybe everything will eventually be bought out by hardware companies, or companies like BandLab. But the business model of perpetual licenses for music software might become riskier by the year/quarter.