Comments on: Making Users Pay

By: Scrivs

Scrivs — Mon, 15 Jan 2007 02:26:11 +0000

I never knew Facebook had that option. I’ll have to loo more into it, thanks for the heads up Christian.

By: Montoya

Montoya — Mon, 15 Jan 2007 01:25:40 +0000

Facebook allows their users to buy advertising… you can advertise an event or a birthday or just about anything in your network for a decent price. A lot of users use it and it’s a smart way to make money from your users. You don’t have to just offer subscription service, you can follow Facebook’s example and offer a way for your users to buy something on your site.

By: Zach Katkin

Zach Katkin — Sat, 13 Jan 2007 23:50:43 +0000

My company is trying to build such a model from some of our forthcoming applications. There are two reasons so many web companies haven’t factored in a paid model, or rely solely on an advertising based model. First I believe its out of fear (that users aren’t willing to pay or may become offended and leave) once a paid offering is announced. And second, paid offerings are difficult to implement. Why worry about infrastructure, billing, and legal issues around collecting personal credit card information, when you can just serve up some Javascript and make a few bucks that way?

I believe that web advertising is the pin that will burst this Web 2.0 bubble. There are just too many sites, legitimate and not, that are supporting themselves via advertising and not a dedicated paid user base.

By: Scrivs

Scrivs — Fri, 12 Jan 2007 19:47:35 +0000

Let’s not confuse advertising from a marketing perspective with that of advertising as your only source of revenue.

By: linux web hosting

linux web hosting — Fri, 12 Jan 2007 16:56:04 +0000

Well, i think advertisements are necessary , the basic reason is that the people need awareness to quality services,however, this has been mislead these days.

By: Christian Watson

Christian Watson — Fri, 12 Jan 2007 16:30:38 +0000

I think offering free and pro (paid) versions of a service is a completely valid and excellent model, as long as the free version is not too limited (i.e. it basically forces you to upgrade in order to use the service in any meaningful way).

As the manager of a number of web sites, I’m a big fan of hosted services – it’s much more cost-effective than installing all your own applications; the whole web 2.0 phenomenon has been a godsend from this standpoint.

The only downside about using these (generally pretty new) services for business purposes is the danger that they might go out of business. Now, that’s a scary thought!

By: Mapping The Web » The Web 2.0 Company Mentality

Mapping The Web » The Web 2.0 Company Mentality — Thu, 11 Jan 2007 14:22:23 +0000

[...] After reading and commenting on an interesting article over at Wisdump, I think the topic merits a post of its own.Â [...]

By: Aidan Henry

Aidan Henry — Thu, 11 Jan 2007 07:59:50 +0000

I think we’re missing the whole ‘web 2.0 company mentality’ here…

My take is that the companies that don’t charge users aren’t actually marketing their services to users, but rather marketing the company to potential buy-out candidates. In other words, they are trying to gain a large user base and massive exposure in a short period of time, hence the ‘free’ service.

Then… they attempt to sell to a larger player. They never really have plans for a revenue model all along, nor did they intend to. They hope to get bought out and let the acquisitor deal with that situation. Slapping a subsciption fee will definitely dampen user growth and provide a barrier to entry for many.

I know this mentality seems ignorant and pig-headed, but it’s the truth – in my opinion of course.

Cheers,
Aidan

By: engtech

engtech — Thu, 11 Jan 2007 07:42:16 +0000

I’m constantly amazed at how I’ll jump through hoops to save what I’d spend on lunch.

I’ve finally been getting away from that.

By: Ben

Ben — Thu, 11 Jan 2007 06:43:54 +0000

The key is being sure you’re providing a service your audience is willing to pay for – and often that’s not the case. Facebook.com never takes off and becomes almost manditory as a college student if it requires you to pay to get in. And if they stopped now and asked for a fee, how many people drop out? As soon as some drop out it loses a lot of it’s value, and that’s that.

I’ve heard stories of internet companies (and I don’t know how true they are, but where there’s smoke there’s fire) that have developed a fairly strong user base, decided the way to go was to ask for a subscription fee and poof – the base disappeared. They figured they could get what they wanted elsewhere and that was that.

I think another fear is the (perceived?) transience of internet companies. When you buy software you have a feeling that it’s yours forever, until you’re done with it. But there’s a feeling that so much on the internet changes (and often subscription fees are on a per month basis) that you don’t get to keep what you’re buying. Think about video games. I think people are much more willing to pay $60 for a game than $5 a month for a game they’re probably going to play for only a year. Because in the first case they have it, in the second case the perception is that it disappears. And that perception plagues a lot of the subscription based companies on the internet.

Of course all of this is just conjecture. I don’t have proof one way or the other.