Vibhu Norby is talking about the flaw in the strategy of software companies looking to profit from running ads on mobile apps. In brief, he says the strategy is doomed, based on his experience and that of other once-popular app makers.
How might this relate to CAD? Autodesk at its Media Day last week said it is buying up all kinds of mobile app companies, and hopes to profit from pushing ads to its 95 million new-found users.
Mr Norby describes his company's experience at user numbers. It boils down to this: after x number of people download your free ad-funded software, about 5% keep using it. This algebra assists in explaining the user-number crash of SocialCAM, which fell by 95% -- right on target -- from 83.6 million in June (one or two months before the purchase by Autodesk for $60 million) to 4.3 million in October. The per-user price paid by Autodesk jumped from 70 cents to $13.95.
(The other reason for the crash was due to Facebook changing the way users are counted: "But far more importantly, Facebook cracked down on spammy apps like Viddy and Socialcam which essentially tricked users into installing the app in order to watch a video," reports Owen Thomas.)
Autodesk may love social, but social is a fickle lover; I expect SocialCAM's number to fall further.