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This dev created a service that is hosted by himself. There is no "steep" in $20 if you think about server costs and support. Heck, think about how less $20 is, in terms of a whole year! I don't know this guy and I don't need his service but I'm sorry for him that our "every must be cheap or free" dev-culture will make his product less attractive by not making the customer to the product instead.

> I can "self-host" WordPress for free.

If your time is worth nothing

You are not paying for the hosting, but for the convenience.

Okay, but then I have to ask - how is this more convenient than Wordpress.com or Tumblr?

It's cleaner, you have version controlled dropbox files, edit seamlessly on your computer using any editor. All the pain points/features are listed on the site.