How businesses and developers as individuals make money from software projects is one of the most important decisions they have to make. Of all the business models and strategies available, companies and freelancers need to pick the ones that best match their market and goals. This post focuses on the popularity of revenue models among professional developers and the companies they work for.
Of all the revenue models we track in our surveys, contracted development / consulting is the most popular model. As of Q1 2022, 31% of professional developers are using this model, 7 percentage points more than the next closest revenue model – selling apps or software. Contracted development can span months or even years, allowing for developers and companies to properly plan out resources during the project.
In addition, professional developers and their companies may find the clients they contract for require additional services, thus leading to additional revenue. Contracted development is tried-and-true as it’s been the most popular revenue model for the past five surveys.
Selling apps/software through an app store or their own portal is the second most popular revenue model, with almost a quarter (24%) of professional developers making money in this way. Furthermore, adoption of this model has been stable over two and a half years, despite “Epic” lawsuits against Apple and Google in 2021, which argued that these app stores had excessive fees and restrictive payment collection processes.
App stores and portals are popular now, but other technologies, such as progressive web apps (PWAs), could start to impact the popularity of app stores. PWAs can work across multiple platforms, provide a native experience, and can help developers avoid high commission fees from app stores; all of which are big incentives to embrace the power of the web.
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7% of professional developers are generating revenue from selling data
Interestingly, less than a tenth (7%) of professional developers are generating revenue by selling data. Data has often been referred to as the new gold and data breaches are heavily covered in news articles as well. If data is so valuable, why are so few professional developers using this model? Regulatory measures, such as the EU’s General Data Protection Regulation (GDPR), could be hampering developers’ ability to sell user data based on the “right to be informed” principle. The California Consumer Privacy Act (CCPA) also has multiple restrictions for selling user data including an earnings cap based on a company’s total revenue. These are just a couple of examples of why selling data is difficult, which impacts its popularity as a revenue model.
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