Making Money Online: Profitable Freeware?

One blog I really like is called MicroISV on a Shoestring. It details Patrick’s entrepreneurial adventure with some software he wrote in Java to make Bingo cards. His blog talks less about the software itself and more about the business side of things: advertising, payment processing, and even his profit statistics. It’s articulate and interesting – for June he made a profit of $750. That’s pretty good supplementary income which can then be used to pay down debt, increase retirements savings, or for the monthly payment on a very nice BMW. C’mon Patrick. Go for the BMW.

My original passion is writing software, but recently I’ve become quite interested with making money online. No, I don’t mean sending out phishing e-mails and stealing bank accounts. I’m talking about all the new products, services, and blogs that are run by small groups or individuals that are making enough money to quit their day jobs. I find it extremely fascinating, and a stark contrast to the old way of making money with computers: selling logo-covered boxes with CD’s in them (i.o.w., shrinkwrapped software J).

Another blog that I like to read is John Chow’s where he talks about how me makes money by blogging. Like Patrick, he posts how much money he makes on occasion. Since he’s making $12K a month he is also able to afford a very nice BMW, but unfortunately he bought an Acura TL. I’m going to throw my hat in for his linkback program and do a quick review of his site: I like how he talks in-depth about all the ways he’s making money via the Internet, even if it is mostly through advertising (although that’s no surprise: really the only other way is to host an MMORPG). Since I’m supposed to say something I don’t like about his site, I’ll go ahead and state that I don’t like how he always has the same graphic at the top of the page. Yay, two blue sports cars. Granted, many people read his blog via RSS and thus won’t even see that, but I think a little variety could help spice up the blog a bit. Maybe he could have 10 pictures that are cycled through randomly with JavaScript.

Markus, the guy behind the dating site, has become many people’s hero (including mine!) because he is the sole proprietor and lone engineer of an online dating website that has not only made him a millionaire (even if it is Canadian dollars J), but that is also probably scaring the “big fish” like and True. That’s something I’d love to do with Paint.NET: even though I don’t plan to or want to overtake Photoshop, I’d love to scare them a little and see them copy some of my features J For instance, maybe they could upgrade their gradient tool so that “Undo” can graduate away from the #1 most used keyboard shortcut. Just a thought.

Anyway, let’s get back to talking about Paint.NET and the title of this blog post. In the last year, my opinion about advertising has turned a full 180 degrees. No longer are commercials just those things that cause me to press the fast forward button (especially since I cancelled my cable TV and now get my TV shows on iTunes). Advertising is now the key ingredient that is fueling a huge wave of innovation on the Internet. Step 1: Build a website and put Google AdSense on it. Step 2: Get lots of traffic. Step 3: Profit!

From the business side, three things are apparent about Paint.NET. First, it’s freeware. It doesn’t cost a dime for anyone to install and use it. Second, I accept PayPal donations. Third, I have Google AdSense on the website. And yes, Paint.NET is profitable. I’m hesitant to publish any numbers, however. I’ve always felt that that telling others your income is like bragging, especially at my age bracket where many of my friends are still finishing school and eating lots of ramen (although, I like ramen too!).

Me: “I make $X a year.”

Girl: “You’re loaded! I hate you! L Buy me a beer! Marry me! J

I e-mailed briefly with Patrick about this, and he thinks that I should publish my numbers and that it would be received as an online success story. Also, I noticed that Paint.NET has been nominated numerous times by readers on Coding Horror where Jeff Atwood is going to have a vote on what to do with $10,000 worth of advertising revenue. If Paint.NET were to win, then I would get $2,500 (woot!). However, if I were to publish my revenue statistics afterwards then I might really feel like I was bragging. Or, would that be fueling the “success story” angle? In any event, I would not feel comfortable accepting and pocketing that $2,500. You see, the numbers I make on Paint.NET are in addition to my day job salary as an engineer at Microsoft. I already drive a nice BMW and own a condo in downtown Kirkland. I would have to delegate the money to something else, such as a plugin contest of my own (“write a sweet plugin and get $500!” maybe?).

This stuff is very exciting to talk about, but since it concerns money there is a very fine line to toe. Where does it stop being exciting, and start coming across as bragging? Should I publish my numbers? Should I blog more about the “business” side of Paint.NET? Will it galvanize my PayPal donations if people know how much I’m making? Will I be placed under an uncomfortable spotlight? I can just imagine the horrible Slashdot titles now …

Well, I’ll at least venture forth 3 things I’ve used my Paint.NET revenue for this calendar year. First, I bought a copy of Photoshop CS3 for competitive analysis. For the record, I was quite underwhelmed with the smart filters feature. Second, I’m finally forming an LLC for Paint.NET, something that’s costing me a fair amount of cash because I’m relying on for the grunt work. Third, I built my sister a brand new computer after she called me up and said, “What does disk failure boot mean?” (second hard drive failure in 2 years = let’s just replace it). I also pay $38.95 per 3 months of 1 TB/month hosting at (by the way, they rule and I highly recommend them —and no, I am not receiving any compensation from them for this endorsement).


12 thoughts on “Making Money Online: Profitable Freeware?

  1. Adam says:

    I vote for disclosure. It is considered ‘impolite’ to share one’s salary info with another since it may imbue feelings of jealousy, which are detrimental to a workplace.

    That’s really not an issue here.

    I haven’t heard any good reasons _not_ to disclose the information. It won’t be considered bragging, except by those who are shallow and lazy. It will be very motivating to those who have ideas and aspirations but aren’t yet willing to make the leap.

    In this case, ignore convention, ignore the doubters, and ignite passion.


  2. RobJ says:

    > Where does it stop being exciting, and start coming across as bragging?

    When you walk around saying “I make $x / month on something that’s freeware! Eat that, wage slaves!”

    > Should I publish my numbers?

    If you like, but it’s not as important as…

    > Should I blog more about the “business” side of Paint.NET?

    Yes please.

    > Will it galvanize my PayPal donations if people know how much I’m making?

    Perhaps, perhaps not. If the tool is good (and it is), people will reward your hard work.

    > Will I be placed under an uncomfortable spotlight? I can just imagine the horrible Slashdot titles now

    Maybe, maybe not… it is open source and you indicate the revenue is from donations…

  3. Rick Brewster says:

    RobJ, well I certainly hope I don’t start walking around bragging like that 🙂 The hypothetical dialog above was meant as an illustration.

  4. Starkos says:

    I’ve just started investigating the possibility of using systems like AdSense to help self-fund a project that I’m working on. I would definitely be interested in more business-side articles, and I also vote for disclosure as it would be nice to know what a reasonable goal might be (and if my systems are under-/over-performing).

  5. rhubarb says:

    I just looked at on your recommendation. First thing I see on their site just jumps out at me: 24x7x365 Customer support. Wait a minute? 24 by seven. By 365. Isn’t that 365 weeks in a year. Can these people add?
    Call me a pedantic nerd, but that’s it for me. NEXT!

  6. Rick Brewster says:

    rhubarb — Well, the people that manage the hosting servers are probably not the people who wrote the web page. I wouldn’t let something petty like this get in the way. From a quick web search, using “24x7x365” is pretty common.

    I guess you could always sign up for DreamHost and have 80% uptime and get your password hacked 🙂

  7. pyrochild says:

    “I would have to delegate the money to something else, such as a plugin contest of my own (”write a sweet plugin and get $500!” maybe?).”

    Me likey that idea!

  8. Lulworth says:

    Rick, I would love for you to disclose. I’m seriously think of quitting my job and coding for myself within the year, so hard data would be very interesting. And congratulations for making what sounds like a decent profit – yay for the little man!

  9. Kishore says:

    I would love for you to disclose. This will let others to think and decide which way they should take, free with ads or small price.

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