Blog Post

Why MobileMe Wants to Be Free

My MobileMe Fantasy

In response to complaints about MobileMe(s aapl), the latest terse Steve-mail (via MacRumors) asserts Apple’s cloud services “will get a lot better in 2011.” That’s good, because it’s hard to imagine the industry-trailing MobileMe taking a downward turn from where it is in 2010.

The Competition

While a year of MobileMe goes for as little as $50 on eBay (s ebay), Apple sells the service for $99 per year, or $69 for the first year with the purchase of a Mac or qualifying iOS device. For that, the MobileMe subscriber gets services like IMAP e-mail, data syncing, photo and website hosting, an interminably slow iDisk, a questionable Backup, and Find My iPhone. They also get 20 GB of storage and 200 GB of monthly bandwidth. There’s also a MobileMe Family Pack for $149, providing more e-mail addresses, storage, and bandwidth.

In comparison, Google (s goog) offers free e-mail, data syncing, photo hosting, along with a free office suite, and free Android device location. If you need more than a limited amount of storage, it’s cheap. 200GB can be had for $50, with less space available for less money. Microsoft (s msft) provides 25 GB of storage, along with free e-mail and other similar services, all for free. See where this is going? Apparently Apple doesn’t. Apple just recently  introduced Find My iPhone for free, but it basically had to because of what the competition is offering.

Sell Hardware, Not Services

That’s just the latest example of the miserly attitude Apple has had towards the cloud, an attitude that is a far cry from the forward-thinking introduction of iTools in 2000. When that predecessor to MobileMe launched, all services were free, and millions signed up. Two years later, Apple renamed iTools .Mac and started charging for it, losing about 90 percent of users in the process. Even after opening the service up to PC users, and more recently iOS devices, MobileMe has never been as popular as iTools. A free MobileMe would change that.

If it seems counterintuitive to give services away free that currently earn money on a subscription basis, it is, unless you aren’t really in the software subscription business to begin with, which Apple is not. Last quarter, Apple earned $20.3 billion in revenue, with just under $18 billion coming from sale of Macs and iOS devices. MobileMe was lumped in with software and services, which presumably includes OS X and applications like iLife and iWork. The entire group earned $662 million for the quarter. From desktops to handhelds, Apple is in the business of selling computers, and free cloud services sells more hardware, or at least help retain more existing hardware customers.

By making MobileMe free, those using it with iOS devices won’t be using services from Google (s goog) or Microsoft (s msft), which makes switching to Windows Phone 7 or Android more difficult. While PC users would also have MobileMe free, they’d need to have iOS devices to make it really worth using. The Halo Effect, which argues that iOS device sales later lead to Mac sales mitigates the loss associated with giving away MobileMe to PC users in the present. If they do switch, free MobileMe helps encourage them to remain all-Apple in the future. Free MobileMe would be an investment in hardware customer retention, and it doesn’t even have to be completely free.

For example, Apple could give away a year of MobileMe with the purchase of every Mac or iOS device. After all, they already offer a discount with purchase. Free MobileMe would be an incentive to upgrade every year, like the “free” year’s warranty you get by upgrading your iPhone every year. However, that would still cause at least some consternation when the $99 bill comes due a year later if you don’t upgrade. A better solution would be to offer a version of MobileMe free for anyone using a Mac or iOS Device.

MobileMe Lock-in

If I were in charge of Apple marketing and stuck with the cloying MobileMe moniker, I’d go with: MobileFree, MobileMe ($49), and MobileWe ($99). The latter would be the MobileMe Family Pack. The prices would be reduced, of course, because this is 2010 and storage is cheap, especially in North Carolina, home of Apple’s new data center. MobileFree would include a basic set of services: mail, syncing, hosting, and a more appropriately named device locating service. Additional services and storage could be added in paid tiers.

Admittedly, most people would be happy with the free option, but there would be money to be made with advanced services, too. A service called Cloud Capsule would be a real, reliable backup solution using Time Machine off-site. Domain hosting would be Apple’s simple, elegant answer to what can be a difficult service to set up for the non-technophile. Perhaps a subscription iTunes service. These are just examples of ways to get people to use more storage and services to generate revenue, but revenue from MobileMe is not, and never will be, the point in and of itself.

The point is lock-in. Get people using Apple’s free services with Apple’s highly profitable hardware, and they’ll be less likely to buy hardware from competitors. That’s how the iTunes and App Stores work, and that’s how MobileMe could, too. If only Apple would set it free.

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35 Responses to “Why MobileMe Wants to Be Free”

  1. I’ve been a subscriber to .mac since April 2002 when it was iTools and free. Since about Oct. 2002 I’ve been paying the $99 a year. $99 a year? I just want to keep my .mac email address I signed up for when I bought my first Mac. I don’t need the rest of the services.
    I’ve been using the services anyway the last 2 years because, I have to show something for that $99 I’m paying. But believe me every year when my payment is due I still consider canceling it, even if it means losing my email address of almost 9 years. I just wish Apple would at the very least, make their email addresses free, with just a 1GB limit. Even Juno does that.

  2. great concept Mobile, free, me and we. Apple sign the him up
    I think that mobileme, if free could be very successful. I find it very easy to use an really like how everything sync’s together. A lot of people who aren’t technologically minded but still have iphones could find it useful for placing events on their calendar, sending invites and coordinating their email, phone numbers, address book etc in one address book in the cloud.
    Apple have the hardware out there, now all they have to do is make it easy to use the software side of it (including itunes)

  3. You know, I don’t think that Apple has a lot of skin in the game for cloud. Call me crazy, but I’m pretty sure they want to sell physical downloads. And since one of their USPs is the ability to buy flash storage at a lower price than its competition, they have some good reasons not to go cloud crazy.

  4. Great article.

    I’ve always thought MobileMe (and .mac) should offer a legitimate back-up and syncing tool.

    It would be great for Apple to do something á la Arq ( that backed-up elegantly and enabled you to share files á la Dropbox (

  5. I use MobileMe and I don’t mind paying for it. I love no ads in my email or my gallery. iDisk is slow sometimes but it works 99% of the time. 20GB is enough storage for me, I keep all my pictures in a private album and I use iWeb to host my Podcast. I trust Apple to have my best interest at hand and that is why I pay for it’s service. Apple doesn’t make money on advertising and doesn’t snoop in my emails to deliver ads, if I wanted that I would use GMail, I don’t so I pay for MobileMe.. I got mine on eBay for $37 and I will buy again when my year is up. You pay for what you get!!

  6. Good advice. Listen up Apple: Free does not mean profit free. Look at Twitter, Facebook.

    I have bought Apple’s devices for over twenty years. Clearly profit is a core value. Check out its bank account. It’s always had a bit of the Scrooge to it when comes to letting go of the odd dime. “Are there no Googles!? Are there no Dropboxes!?”

    Apple’s not the merchant as is Amazon. Or this century’s madmen as is Google. Curiously I see Apple as a blacksmith who wants cash on the barrel head.

  7. Zac Massey

    Yeah. This would be awesome! Everything I need is in the free version. And it would be even nicer if they would allow the free Find My iPhone service (that’s available now) to other iDevices, such as support for the third gen devices… If my iPhone were to get stolen again, I’d like to know where it is without buying something…

  8. My mobileMe account did NOT charge me on the renewal date of November 28 and when I checked today it says “Renewal Date … Dec 30, 2010 (32 days free)” so I expect it will REMAIN FREE come January 1st or at least all changes will be implemented on that date!!!
    I’m amazed the rest of MobleMe users haven’t clued into this.

  9. Hamranhansenhansen

    This is just another variation on the “Apple is overpriced” argument. The answer is always “you get what you pay for.”

    > sell hardware, not services

    Apple primarily sells software and services, not hardware. The hardware is as unimportant by itself as the DVD that a Mac OS upgrade comes on. You buy a Mac to get Mac OS and/or iLife, not to get a Core 2 Duo. You buy iPod to get iTunes, you buy iPhone/iPad to get iOS. iTunes Store and App Store are services. You shop at Apple Store for the service … you can get slightly lower prices elsewhere.

    > Google offers free

    Google’s software and services are absolutely not free. You pay for them by looking at ads and giving up your privacy. One of the license terms for using Gmail is you allow Google to read all your email so they can place contextual ads. Another price is you look at those ads while you do email. Google is an advertising company.

    “Free TV” is also not free. You look at ads. Saying “why HBO wants to be free” is just saying “HBO should have ads and censorship and lower-end content.” People subscribe to HBO precisely because it doesn’t have ads and censorship and lower-end content. I subscribe to MobileMe precisely because it doesn’t have ads or require me to give up my privacy.

    MobileMe costs $1.90 per week. That is less than a coffee at Starbuck’s. Not a week of coffee … just 1 cup of coffee. For that, when I make a Bookmark on my Mac, it appears immediately on my iPad and iPhone. Same with Contacts and Calendars, and about 10 other things, including 3rd party Transmit Favorites and OmniFocus databases. I get a cloud disk with a public folder that’s easy for friends to upload items into, and easy to share items out of as downloads, and appears as a disk on my Mac and in its own app on iOS. I get really, really good email with aliases and very little spam and 20MB attachments and a Web interface that is so good I like to use it more than the built-in Mac OS Mail. I can make a website in iWeb and publish with one command and easily point a Web domain at it. More stuff also … it is a lot for $1.90 per week.

    If you are a nerd or you have a lot of time and you don’t mind ads and you don’t value your privacy, you can cobble your own MobileMe together from various free services which may or may not last, same as you can build your own PC. For the rest of us, we would rather just pay $1.90 per week and everything just works, for years now, and they keep adding things.

    So I’m looking forward to added features like keeping my iTunes library on my iDisk, not looking forward to MobileMe being free.

  10. Apple is pretty stuck up at selling everything at premium arrogantly.

    Stupid Apple worshippers even standby that arrogant company to speak up for them, even willing to lay their lives or a million bucks to defend their ego.

  11. They don’t have a reliable service when it is paid, it will be even worse if it is a free program. Like Mike3k says below, the spam filter sucks so you run your emails through gmail to filter the junk… just use Google to begin with.

  12. I’ve long thought apple should offer extra value for mobileme /.mac by including, say, a free OSX/iLife upgrade while you’re a member, and/or make mobileme free for the length of your applecare warranty.

  13. from your lips to god’s ears (and by god, i mean SJ)

    The point is lock-in. yes, and if they had kept iTools free they would have had millions locked in…

    sometimes it is just frustrating the small errors that they make that everyone can see is an error… it is like like they don’t have anyone out there that is mixing with the regular folk. (us non-gods)

  14. If only this was real. It would make my $100 worth it for sure. I can only hope that Apple does what you call Cloud Capsule. They can do it now with that massive data center they just built.

  15. I stopped using this service shortly after naming shift to .Mac because I could get all the essential services with a vastly better feature set and more reliability from Google, for free. I would absolutely use Apple’s service if they offered comparable calendar sharing and email filtering, among other services. But their approach to this cloud services model has always been, as the article said, miserly.

  16. I appreciate interest and attention to Apple’s MobileMe service. But you’ve missed the point. The .mac service has always had the potential to be a uniquely valuable asset to Mac users, but has never worked right.

    MobilMe has 2 distinct advantages. 1) By mounting iDisk folder alias icons into Finder sidebar, we get the very best way to upload files. iDisk folders could be just as accessible as local folders. 2) We get to organize and name our own files on iDisk. This makes it easy to automate sharing. With one click in BlogAssist, I get a complete img src tag ready to paste. You can’t do that with any other photo sharing service, because you have to take whatever file address they decide to dish up.

    The problem with MobileMe is that Apple has always been too cheap to make make it work reliably. Making the service free is not going to help. I want to pay for great service. After all these years of hoping, I’m giving up. MobileMe keeps getting worse. Apple has refused to deliver great service, so I’m migrated to Google and gritting my teeth. If I’m doomed to bad service, it may as well be free service.

  17. Even if MobileMe becomes free, Apple’s arriving very late at this ball game. Google mail and its kin already own free mail and many Mac users now consider the free features of Dropbox as the way to synch. All these competing products work so well, it’s difficult to imagine how Apple could come up with something that’d make the bother of switching worthwhile. No build-it-into-the-OS-so-they-must-use-it will counter products as easy to set up and use as Google Mail and Dropbox.

    I suspect the blame rests on the same business/marketing-school-trained bean-counters who want to dribble out new features to iPhones, iPads and iPods slowly to force us to upgrade. They think that, with the proper marketing and dancing shadows, they can sell us anything, including MobileMe. Not so.

    The belated and anemic camera on iPod touches is a good example. A cleverer company wouldn’t just have a decent camera on all touches, it’d have a touch model that’s also a high-quality point-and-shoot camera, not a one-size-fits-all models differing only in storage. That’s a bit like having a line of cars differing only in the size of the trunk.

    Apple’s making the same mistake it made in the late 1980s–too little real diversity and flexibility in its products. There’s too much “our way or the highway” at Cupertino.

    • “A cleverer company”? A clever company know’s it’s audience. Does Apple know that people will wait in line for X-gen products and then a large percentage of those to do so again 12-18 months later when they release the next generation of the product? Another percentage taking an every 24 months approach. The fact that it is working for Apple extremely well speaks for itself. How much profit is Apple making year over year?
      Maybe they should be like Acer, etc. where all their products range from crappy to decent and are basically out of date the day they are released. Like having a huge inventory of automobiles all ranging in different shapes, size, color, etc. thus increasing the resources of production and distributing. How much profit does Acer and GM have year over year? Clever indeed.