IT Director for a non-profit in Washington, DC. Man About Internet.
Dalton Caldwell, at the App.net Blog writes:
Although App.net has had only paid account tiers thus far, we initially conceived of App.net as a freemium service. It took some time to get to this point, but we are now ready to make this vision a reality. Sorry folks but I've already sent out my existing invites. You must have an invite to create a free account, or you can just subscribe like the rest of us.
Richard Muscat, writing at Serious Simplicity:
My contention is that “Free” as described and used in many contemporary web-based businesses is a non-business model that is not only broken, but actively harmful to entrepreneurship. Free rarely works, and all the times that it doesn’t, it undermines entrepreneurial creativity, destroys market value, delivers an inferior user experience and pumps hot air into financial bubbles. I think this piece hits it out of the park. Why should you price your product as a pay-for-service or good? This article lays out all of the reasons and why free should never be your decision.
The fragility of free is a catchy term that describes what happens when the free money runs out. Or — perhaps more accurately — when the investors/founders/venture capitalists run out of cash, or patience, or both. Because at some point Twitter and all other companies have to make the move from ‘charity’ to ‘business’ — or, put another way, they have to make the move from spending tons of money to making slightly more money than they spend. Kyle Baxter wrote a follow-up to Ben Brooks' article: Twitter’s value lies in it being a communication utility, where anyone and everyone can quickly communicate information. That’s incredibly powerful, and it simply couldn’t exist if it wasn’t a free service. This doesn’t mean the strategy Twitter pursued is correct; rather, it means their error was in being so cavalier about a business model. They assumed if they reached a critical mass of users, turning it into a profitable business would be easy—and they’ve discovered that isn’t really true. It takes just as much thinking as building the actual product does. Read the first article, and then the second one. Done? Good. You may now resume your normal #dickbar bitching.