The genius of Disco (or Buying Buggy Betas)

John Gruber ran an excellent article, ‘Beta’ is Not an Excuse, dissecting the important difference between beta software and simply buggy, but released, software. His target: The much ballyhooed CD burning application, Disco. His point was simply that calling Disco “beta” is disingenuous, because as long as they’re selling the software, they have an obligation to their customers to create software that works.

Simple logic, but it misses the true genius of their approach: They’re using pre-sales as a means to gain investment capital to fund the final development of Disco!

Disco, you see, is still in beta, and still has some bugs which I can only classify as henious. As an early adopter of the software (I got it off the pernicious MacZot, a site that seems dead set on capturing my pocket change), I have found it to be exciting to look at but incapable of burning anything more functional than a coaster. (By the admission of the program.)

But here’s the rub: I paid for this software.

I must be stupid, right? Well, yes, perhaps so. But the folks at Disco are nothing short of geniuses!

Let me ask you this: How do you fund a software start-up?

Most people use some combination of credit cards, personal savings and outside capital (either The First Bank of Mom and Dad or, if they’re exceptionally lucky/well-known, venture capital bucks). This money often is hard to come by and runs a very high interest rate. So start-ups often try to stay exceptionally lean until they have a first release and can finally start bringing in revenue and pay off their loans and investors.

Not Disco, though, no sir! They’ve managed to create such a feeling of trust and excitement (through some phenomenal viral marketing, aided by MacZot), that people (thousands of people) were willing to pay $5 for the software before they even knew what it did! Furthermore, once the software’s final purpose, features, and so forth were released, excited users could buy it at half price ($15) before it’s so-called final release.

In one fell swoop, Disco was able to build up a few thousand dollars in sales without even the requirement that their software exist, let alone be stable, feature-complete, and reliable! If that’s not a stroke of true marketing genius, I don’t know what is.

And, of course, they no longer have to worry about paying folks to beta-test for them. A paying customer will be quite eager to download the latest point releases and test them out, hoping beyond hope that the program will justify the $15 worth of expense.

The danger inherent in this approach is that the Disco developers now have a true obligation to these paying customers to deliver a fully functional application, and moreover, to deliver it quickly. If they don’t, they will lose credibility and won’t be able to pull this stunt again (and others will find it far harder as well).

As for me, I’m still Toasting my CDs, as Disco just hasn’t proven itself reliable enough to handle my backup needs. Maybe the next release will reliably burn a disc…

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Written on November 14, 2006