Adware - As Business Model

As Business Model

In legitimate software, the advertising functions are integrated into or bundled with the program. Adware is usually seen by the developer as a way to recover development costs, and in some cases it may allow the software to be provided to the user free of charge or at a reduced price. The income derived from presenting advertisements to the user may allow or motivate the developer to continue to develop, maintain and upgrade the software product.

Some adware is also shareware, and so the word may be used as term of distinction to differentiate between types of shareware software. What differentiates adware from other shareware is that it is primarily advertising-supported. Users may also be given the option to pay for a "registered" or "licensed" copy to do away with the advertisements. An example of this type of adware is the Eudora e-mail client, which for a time was optionally available in "sponsored mode". In that mode, the client offered the full functionality of the paid version of the client, but displayed advertisements. The Amazon Kindle 3 family of e-book readers have versions called "Kindle with Special Offers" that display advertisements on the home page and in sleep mode, in exchange for substantially lower pricing compared to the ad-free devices.

In 2012, Microsoft and their advertising division, Microsoft Advertising, announced that the forthcoming major release of Microsoft Windows, Windows 8, would provide built-in methods for software authors to use advertising support as a business model. The idea had been considered since as early as 2005.

Support by advertising is a popular business model of software as a service (SaaS) on the Web. Notable examples include the email service Gmail and the social network Facebook. Microsoft has also adopted the advertising-supported model for many of its social software SaaS offerings.