Paper, the preeminent iPad sketching app, has always been free to download, but its advanced brushes and clever color mixer have cost $5 via in-app purchases. Today, all those tools go free, making one of the best pieces of software developed for the iPad completely free to use.
But how? Why? What drove Paper’s parent company FiftyThree to make this business decision? Talking to Georg Petschnigg, CEO and co-founder of the company, he gave me a short answer and a long answer.
The short answer is that their Bluetooth stylus Pencil is carrying the business right now–leading FiftyThree to release a new gold version for $60 today. While FiftyThree isn’t releasing sales figures, they point that Pencil is the only stylus sold in Apple stores, it’s the top-selling stylus on Amazon, and it’s the top-selling digital stylus in the U.S.
The long answer is that by making Paper free, they also hope free tools will get more people using Paper’s social drawing platform, Mix–what we called “an Internet you can touch“–which FiftyThree plans to offer as a subscription-based enterprise product later this year.
“For us, the mission is still clear. We want to make creativity and productivity more accessible. That will never change,” Petschnigg says. “Now our business model, that can evolve.”
FiftyThree’s evolving business model stems from the fact that it’s a somewhat atypical company. While even big tech companies like Twitter, LG, Facebook, Samsung, and, to a large extent, Google, will specialize solely in software or hardware, with 53 employees, FiftyThree has both software and hardware specialists recruited from companies like Microsoft and Sonos. Strategically speaking, this allows them to rely on both hardware and software to generate meaningful revenue–and so far, we’ve already seen FiftyThree go from leaning their business on in-app purchases to a tool sold on store shelves.
“We have to give credit where credit is due. There are few places that have done this model extremely well. Certainly Apple is doing it. Microsoft with the Xbox business–the huge differentiator of Xbox is Xbox Live. It’s hardware, software, and services,” Petschnigg says. “It’s no surprise a lot of our team comes from Xbox. We certainly learned from the big guys.”
Download Paper here.