Generally, for a software company to survive and to provide endless updates, the customers have to be charged a recurring fee. Otherwise, the software company will be solely surviving on new sales every month, to afford to push out updates.
The reason why software is rarely recurring in this industry is because of how fast paced our industry is. Marketers get a lead on a new method for a certain social site and then in just months, or even weeks later, the method is either patched by the website or the users become more intelligent and the method no longer works as good as it once did. Therefore, users stop paying their recurring fee for the software and move on. Instead, software vendors charge a higher one-time fee, to milk the absolute most out of these marketers before the software becomes obsolete.
As a software developer, I am continuously involved in this. It’s not easy to establish a long term recurring income, so generally I make my money on one-off hits every few months and continuously study things like this.
For a software vendor to make a stable recurring income, they’d have to counter the fact that buyers are going to stop paying your recurring fees when the software becomes obsolete. The primary way to do this would be to push out a new software every 2 or 3 weeks, and hold all of the software under an umbrella website that sells a recurring membership to access all of it.
This is a concept that intrigues me, and after reading the book Rocket Fuel, I’ve decided I’m not going to pursue this until I find myself an integrator. However, it will be done eventually, and it will be my next 6 figure project.