Dropping the price of Metacast Premium to $19.99/year

Earlier this year we launched the Metacast Premium subscription at the $49.99/year and $4.99/month price points. We also wrote up a case study about our thought process.

However, the world is not static. So, a few short months later, we are dropping the price by more than 50%!

The new price point

Starting today, the new price for Metacast Premium that includes access to transcripts for any podcast ever published, unlimited playlists, and eternal love from our team is $19.99/year or $1.99/month.

The best thing — the launch special for the iOS launch is still valid through the end of October 2024, so you can get Premium for the first year for only $9.99.

I'll get to why we made this decision in a second, but first let's cover the question from existing users.

If you purchased Premium at the old price...

If you're a Premium subscriber, chances are you purchased the subscription for $24.99 (or $24.50 on Android) during our launch special. Your subscription will renew at the new $19.99/year price next year.

If you have any concerns about the price change or want to get a refund for the difference, please contact us.

How we made the decision

In one of the recent Metacast team syncs, our Sr. Engineer Jennie said it out loud — "it's too expensive." Arnab and I had thought so too, but we didn't yet get to the boiling point. Jennie was the trigger for us to revisit the pricing.

There were a few factors that helped us make the call to drop the price.

Gut feel

A podcast app is not a critical or even a must-have app on the user's phone. Our gut feel told us that $50 is a bit too much for a non-critical consumer app.

I pay $35.99 for 1Password that is critical for my day-to-day functioning in life. I use it daily. But even so, every time I get a renewal notification, I feel like it could've been cheaper.

Market realities

There are free alternatives, such as Apple Podcasts, Spotify, and YouTube Music. The free experience may be crappy, but ultimately, how much is the extra convenience worth to the user?

Also, most of the other paid podcast apps are cheaper. We came across a subreddit of another indie app where people talked about pricing, what's cheap, what's expensive, etc. We realized that we're priced above people's willingness to pay considering the functionality we currently have. Metacast doesn't yet have enough premium features to command a premium price.

Decreasing costs

When we first got started in mid-2023, transcribing episodes was the biggest and most unpredictable cost. Over time, the cost went down by an order of magnitude. Additionally, now we know how much we spend on the user on average. The number is significantly lower than our estimates a year ago.

That gave us confidence that a lower price won't make us broke. As time goes on and Metacast grows, we will also start benefiting from economies of scale.

To protect ourselves even further, we have put caps on the monthly spend for all services that we use. In the "worst" case scenario, we'll have so much usage that we'll have an outage. It's a good problem to have, because reaching that level of spend would mean we have tons of paying users.

Hedging bets

$20/year feels a bit low. The biggest risk is that there's not a big enough market for building a sustainable business at this price point. We need ~60K paying users to reach $1M in annual recurring revenue (ARR).

Initially, we had plans for ads in the free tier. However, the more we thought about it, the less we liked the idea. We decided to ditch ads (for now) in favor of a more affordable paid tier with a hypothesis that more users would convert to paid. We can always introduce ads if we must in order to survive.

At a later point, when the app is more mature, we can also re-introduce the higher price point for "Super Premium." We can do that when we understand what kind of features users are willing to pay a significant premium for.

Is this the right call?

We're a bootstrapped startup with no prior data. All we can rely on is a model full of assumptions. The hypothesis is that the lower price will attract more paying users, and it'll work out in the end.

Now that we've lowered the price, the "it's too expensive" objection is no longer valid. If people don't pay for Premium, it means we're doing something wrong.

Hopefully, the lower price will help us collect more data and build the right thing for the right user with the right willingness-to-pay.

If you've not installed Metacast yet, get it on the Apple App Store or Google Play.

Follow our journey

• Watch/listen to us talk about pricing on episode 59 and episode 63 of the Metacast: Behind the Scenes podcast
• Join our r/metacastapp subreddit for more build-in-public posts
• Subscribe to our newsletter
• Follow me on LinkedIn, X or Threads