How Simplenote Generates Revenue and Its Open Source Journey

Simplenote, a popular note-taking application, has a unique revenue model and a rich history of open sourcing. Originally sustained by its parent company Automattic, Simplenote has evolved through various financial and development strategies to become an open-source platform. This article explores how Simplenote operates, its development journey, and the current revenue generation model.

The Current Revenue Status

As of August 11, 2016, Simplenote has officially become an open-source project, making its client apps available for download under the GPL v2 license. The application itself is free and does not generate revenue directly. However, Simplenote relies on voluntary subscriptions to sustain its operations. Despite its open-source nature, Simplenote operates under the benevolence of its parent company Automattic, which covers its development and maintenance costs.

For long-term sustainability, Simplenote aims to have around 5% of its active users subscribing to the premium version. This would help cover its costs and ensure sustainable operations. As of now, the majority of Simplenote’s revenue is generated through these voluntary subscriptions.

The Open Source Transition

The decision to open source Simplenote was made in the spirit of broader community involvement and transparency. The official announcement states:

In this spirit we are announcing today that all of the official Simplenote client apps are now Open Source Software under the GPLv2 license. In addition to the previously open sourced Electron app you’ll now find the source code for the iOS Android and macOS applications on our GitHub page.

Automattic initially developed Simplenote by integrating a cloud service called Simperium, which is used for syncing across devices. However, the exact revenue model that Automattic generates from Simperium is not clearly defined in public information. Simperium has been a significant contributor to Simplenote’s development and functionality, making it a crucial component of the application.

The Impact of Open Source on Development and Adoption

Turning Simplenote into an open-source project has had significant implications for its development and adoption. Free and open-source software often enjoys wider community support and deeper integration into various platforms. This can lead to increased user adoption and better product quality through contributions from a global community of developers.

Simplenote’s user base is a key factor in its revenue model. The company primarily relies on converting free users to premium paying users. This involves not only attracting new users but also converting existing free users to the paid version. Simplenote uses various strategies to encourage users to sign up for the premium version, such as highlighting the benefits of the paid subscription compared to the free version.

As users continue to love the app and its functionality, the effectiveness of these strategies will determine Simplenote’s success in converting users and generating revenue. The company remains dedicated to developing the application further, with a particular focus on increasing its reach and engagement among free and premium users.