I'm an indie Android app developer, and in early 2010 I decided to work on a multiplayer crossword board game ala Scrabble or Words With Friends, since no such game existed yet on the platform. I worked with a friend who handled the server side. We decided it would be cool to use Java GAE as the back end for the game. The app, called WordWise, was the first game of its type to the Android Market. We also developed an iPhone version and were the first iPhone-Android cross-platform game of this type to market. For about a year, the game did reasonably well financially. Not WWF success, but enough to help me continue to work as an indie app developer.
In February of this year, Words With Friends released their Android version and our revenue cratered. We use a mixed model of free with ads (including Google AdSense/AdMob) and paid. Revenue dropped off a cliff in February, but were still eked out a modest profit from the game. Under the current GAE pricing scheme, our server costs are $30-50/mo. The app now generates about $150/mo. in revenue. At its peak it was generating thousands of dollars per month in revenue, but those days are gone.
However, we still have a dedicated user base. The app still has over 200K active installs. Under the new GAE pricing scheme, our server costs are going up about 7x. Right now we're essentially breaking even, but maintaining the environment for current users who continue to enjoy playing the game. Under the new scheme, we're going to have to shut everything down. We can break even, but we can't run at a loss. Under the new scheme we'd be paying $200-300/mo. in fees, while the app only generates about half that in revenue.
I'm going to get a lot of angry emails, and since I publish a substantial catalog of other apps and games, this will likely hurt my reputation and potentially impact revenue across the board, but what else am I supposed to do?
I've been a huge advocate of Google and its products. One of the reasons we chose GAE, despite its quirks, was that it seemed like a perfect fit with indie Android gaming. Every Android phone requires a Google account, which could be used for authentication to the GAE server. This policy change by Google is effectively killing our game and nullifying any chances of us using it in the future. Despite the announcement at I/O, I still perceived GAE as a platform suitable for a wide range of developers, from indies like me up to large-scale businesses. It's very clear now that's not the case. I've always had a perception that Google cared about the indie developer community, but I'm honestly baffled by this move.
Yes, Google is a for-profit company, but since their inception, their strategy has often been to offer great free products, initially at as loss-leaders, to encourage adoption. They are then able to integrate their core business, advertising, into those products, and upsell premium versions for enterprise. Are Google reps seriously suggesting that new products such as Google+ are generating direct revenue right now? By pricing out hobbyists, indies, and other small companies from GAE, the initial revenue lost will likely not even be noticed by Google. However, you will have lost an enormous amount of good will and street cred among the developer community.
You could have handled this in a much more sensible way. Why not grandfather in apps under the old pricing platform that have been on the platform for something like at least six months? You're citing apps that have enormous traffic, but what this new policy is going to do is effectively squash a bunch of smaller apps. Why not keep apps under the old pricing scheme if they qualify as "non-enterprise", with moderate-to-low usage? You're telling me Google wouldn't be willing to absorb the negligible cost of providing infrastructure to smaller projects in order to encourage adoption and continue to foster good will among the dev community? And you could still hike up the costs on the big apps, though something tells me even that's going to backfire.
As someone else said, Google lost a lot of cool over this.