[prepend]

My issue is that value based pricing sets up incentives against one of the coolest parts of software and digital goods- near zero marginal costs. Software is kind of magical in that once produced it doesn’t cost much to add a second or billionth user. Of course SaaS has more costs, but not nearly as much as the “charge 5% of value” or whatever.

So I think it’s foolish to not buy tractors and till the land by hand, it’s also foolish to think of a hammer as a value add so that the cost should be 5% of the benefit gained by using it instead of some reasonable profit on top of cost. I’ve bought some plumbing tools decades ago that are really useful, they are well made and should last decades more. Saying that I should pay based on value might make sense but isn’t a good user strategy in the long term.

[jariel]

So that's a fair point ... but 1) 'value based' pricing is inherently part of capitalism, and it's more or less a 'good thing' ... and 2) the upside in general is still pretty huge for most services. The fact that software has 'zero unit cost' is for the most part, built into the price.

It's the reason you can try 100 services for free before buying. The challenge is, to find things that really work for you and that do provide value.