[1123581321]

For hosted, an annual fee is appropriate here. A $25 annual fee is quite similar to a one-time fee of $25 because once it is paid, there is nothing to do but use it for an entire year. After a year, it's very obvious whether the app is worth another $25 or not. Either way the developer's compensation is nearly the same assuming many accounts share the low cost of the servers.

[mattwdelong]

There is a mental line between annual and "once and forever" type purchases. I think it comes down to the thought of getting more value and the fact that you own it..it's yours. Secondly, what if I purchase an annual subscription and forget about it the next year? I just paid another $25 for an app I stopped using over 10 months ago. I don't like that hassel of having to remember what my card is attached to and what random fees are going to come out each month, and that's why I don't like subscribing to anything.

I would rather drive a shitty used car at a one time $5k purchase price over a brand new car at $300/month. For the same reason, I also don't get into cell phone contracts and cable subscriptions. I don't know what subset of the population is like me, but I think it would surprise you.

[1123581321]

I agree people are like that, although I am not sure more people are willing to self-install than pay for hosted.

You also make a good point about renewals. Because the cost of annual plans is out of mind for most of the year, it's important they allow users to disable auto-renew. I use Pandora, RescueTime and Forrst and they all have this option.