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My rule is that if nobody would pay for your service, you probably don't have a worthwhile business. If Google instituted a $0.99 monthly fee to use Google sea

My rule is that if nobody would pay for your service, you probably don't have a worthwhile business. If Google instituted a $0.99 monthly fee to use Google search, people would line up to pay it. They don't have to, because their business model works differently, but they could do that, and it would work. I'd probably pay for an account. If Facebook instituted a $0.99 monthly fee to use that, a lot of people would do it just because it keeps them in the loop with their friends. And in fact, many people would be willing to pay $2.99/mo for a business account which gets to do more (like post more events or whatever). Again, this isn't their business model, but this would totally work as a business model. People would pay for Uber de-facto; they do pay for Uber. Likewise, half my coworkers have bought coin packs in Pokémon Go. In general, lots of games do pay models. If Twitter added a $0.99/year fee, there would be a clone written in a more scalable architecture taking all their users within a week. Some businesses would keep Twitter accounts, but that number would decrease as they lost users. Remember that Twitter added some minor advertising and instantly started losing users. There are tons of other startups with this problem. The idea these days is, get a bunch of users and introduce ads. The problem there is that when you add ads, you're fundamentally changing your service. It's a bait-and-switch. And once you do the switch, if people weren't willing to pay for your service before, they're not going to want to start paying for it in the form of ads.

xseven 10y ago
"The idea these days is, get a bunch of users and introduce ads." That's exactly what Google and Facebook did. All I can take from your comment is "if hypothetical scenario then my opinion is true"
- devishard 10y ago
  Do you disagree with my hypothetical scenarios? That is, do you think if Google/Facebook introduced subscription fees nobody would subscribe? Would you pay to read Twitter? Do you think that anyone would?
  - nostrademons 10y ago
    I disagree with it when put in the context of when the product launched. I wouldn't have paid for Google in 2000 when I first discovered it; while it was better than all the other search engines out there, it wasn't better enough that I'd break my rule of never shelling out money to visit a website. I certainly wouldn't have paid money for Facebook; I was a poor college student when I got my FB account in 2004, and all you could do was poke people. I can poke people in real life without shelling out money for it. I think many people confuse the value they get for a service now, after it has had a decade to refine its product and become deeply embedded in our lives, with the value they get from a service at launch, which is often virtually nothing.
    - devishard 10y ago
      That's a reasonable critique, and I think you're right. There exist products that start off without value people would pay for and slowly develop into something with value people would pay for, and Google is a good example. I guess that leaves room for Twitter to develop into a product people would pay for, but I'm skeptical that can happen without very significant changes to their product, to the point that I'd be hesitant to call it the same product.
deleted 10y ago
[deleted]
benzor 10y ago
I see where you're going with your rule: services that provide True Value™ would likely survive if they suddenly started charging a nominal fee right now. However, as a game developer with Free-To-Play development PTSD, I think this rule rests on an implied-but-important condition: People are already using and loving the service. Imagine that some shiny new app called Spark launches tomorrow and vaguely promises to be Twitter 2.0, well no one would be willing to jump on unless it was free. Even $1 a month is too much for us short-attention-spanned smartphone users, as the total shift to F2P games on mobile has shown us. Nothing outside of Minecraft is in the top 100 grossing apps on Android nor iOS. Perhaps the answer lies in starting free, getting people hooked, and then easing in a subscription fee? This would also come across as a bait-and-switch, as you said, and some users would inevitably flock to the next free clone. Ultimately, and unfortunately, I don't think there's an easy answer to monetization anywhere...
- devishard 10y ago
  > However, as a game developer with Free-To-Play development PTSD, I think this rule rests on an implied-but-important condition: People are already using and loving the service. No, that's exactly not what I'm saying. Uber did just fine starting as a pay service as do a great many games, Netflix, HBO, Amazon, etc. > Imagine that some shiny new app called Spark launches tomorrow and vaguely promises to be Twitter 2.0, well no one would be willing to jump on unless it was free. Right--that's because Twitter 2.0 is also fucked from the beginning: they don't have something users would pay for any more than Twitter 1.0 did. > Even $1 a month is too much for us short-attention-spanned smartphone users, as the total shift to F2P games on mobile has shown us. Nothing outside of Minecraft is in the top 100 grossing apps on Android nor iOS. F2P is basically just an advertising strategy; I'd count that as having something people are willing to pay for, because they're willing to pay for in-game purchases or premium experience subscriptions. > Perhaps the answer lies in starting free, getting people hooked, and then easing in a subscription fee? This would also come across as a bait-and-switch, as you said, and some users would inevitably flock to the next free clone. I guess I wasn't clear about this, but I think a bait-and-switch business strategy will work fine if you have something people value enough to pay for. It's kind of pointless, though, IMHO, because it doesn't fail fast: if it turns out you aren't providing people anything they value, then you won't find that out until you get to the "switch" part. Ultimately, I think the bait-and-switch strategy is just a way to extract money from VCs and offload risk onto them without having to prove your value proposition, but that comes at some significant cost. If I were a VC I'd probably want to invest to build something and then release it for pay up front--that saves the cost of implementing the bait-and-switch strategy. > Ultimately, and unfortunately, I don't think there's an easy answer to monetization anywhere... The answer is "provide value that people are willing to pay for", but I agree that's not an easy answer. :)
tedunangst 10y ago
Is that not exactly what app.net is? They have hardly taken all of Twitter's users.
- devishard 10y ago
  Neither of them provide value people are willing to pay for, so that's unsurprising.
- nhangen 10y ago
  It was the reverse of what the OP suggested. Twitter is still free, and App.net charged people a fee to use it.
fusiongyro 10y ago
App.net briefly tried to be a paid-for Twitter clone. I guess they've sort of pivoted from that model but it was an interesting idea at the time. And obviously it didn't work, because free is cheaper than non-free.
- devishard 10y ago
  Yeah. But even if they both charged the same amount of money, I think they'd just both go out of business, because nobody is going to pay for what either has to offer.
  - fusiongyro 10y ago
    I want to disagree with you, but I paid for app.net and then didn't use it... so I guess I can't.
cmurf 10y ago
I think overall this is decently convincing, the problem I have with it though is the Uber example. Uber is bleeding money and clearly subsidizing rides. If people were paying the true cost of what drivers are paid plus some reasonable mark up, I have serious doubts it'd be as popular as it is. And case in point, I don't use Uber in NYC. Friends and colleagues don't either. It's usually easier and cheaper to get a cab. So... if Uber becomes more expensive than it is now, let alone more than a cab, I think broadly speaking most people will vote for the less expensive option rather than the service with the shiny app.
- devishard 10y ago
  Yeah, I think that having a product people would pay for is a prerequisite to success, but it's not a guarantee of success. I definitely think Uber could lose to a competitor in their product space. The distinction I'm making here is that I don't think anyone will ever succeed over the long term in Twitter's product space, because they don't have a product people would pay for. A competitor might knock them out for a little while, but no competitor will have lasting success unless they figure out a way to modify Twitter's product into a product people would pay for. And at it's core, Twitter's product is kind of worthless, so I don't think there's a modification that would make it worthwhile.
virtualwhys 10y ago
> there would be a clone written in a more scalable architecture Curious, what would be more scalable than Twitter's existing JVM based architecture? 3 years ago[1] they were able to handle upwards of 140 (edit) thousand tweets per second without any latency -- that's pretty ridiculous. [1] https://blog.twitter.com/2013/new-tweets-per-second-record-and-how https://blog.twitter.com/2013/new-tweets-per-second-record-a...
- StyloBill 10y ago
  143 000 tweets/second. Not 140 millions.
- devishard 10y ago
  I didn't explain that well--initially Twitter was on RoR and sharded MySQL, which wasn't scalable. Obviously they have done a lot of scaling work and can handle their load now. If I were implementing Twitter today, I'd probably do Elixir and Cassandra. I don't generally leap to go NoSQL but Twitter's structure is particularly suited to Cassandra. Elixir gives the ease of development I associate with Ruby with the scalable, decentralizable BEAM. I'd also consider going with Erlang straight up--it may not be as pretty as Elixir, but there's a lot to be said for maturity in a language. But I'm saying this because I have the benefit of newer technologies and having seen Twitter's mistakes. From a technical perspective, I think Twitter is pretty well done.

xseven 10y ago

"The idea these days is, get a bunch of users and introduce ads." That's exactly what Google and Facebook did. All I can take from your comment is "if hypothetical scenario then my opinion is true"

devishard 10y ago
Do you disagree with my hypothetical scenarios? That is, do you think if Google/Facebook introduced subscription fees nobody would subscribe? Would you pay to read Twitter? Do you think that anyone would?
- nostrademons 10y ago
  I disagree with it when put in the context of when the product launched. I wouldn't have paid for Google in 2000 when I first discovered it; while it was better than all the other search engines out there, it wasn't better enough that I'd break my rule of never shelling out money to visit a website. I certainly wouldn't have paid money for Facebook; I was a poor college student when I got my FB account in 2004, and all you could do was poke people. I can poke people in real life without shelling out money for it. I think many people confuse the value they get for a service now, after it has had a decade to refine its product and become deeply embedded in our lives, with the value they get from a service at launch, which is often virtually nothing.
  - devishard 10y ago
    That's a reasonable critique, and I think you're right. There exist products that start off without value people would pay for and slowly develop into something with value people would pay for, and Google is a good example. I guess that leaves room for Twitter to develop into a product people would pay for, but I'm skeptical that can happen without very significant changes to their product, to the point that I'd be hesitant to call it the same product.

deleted 10y ago

[deleted]

benzor 10y ago

I see where you're going with your rule: services that provide True Value™ would likely survive if they suddenly started charging a nominal fee right now. However, as a game developer with Free-To-Play development PTSD, I think this rule rests on an implied-but-important condition: People are already using and loving the service. Imagine that some shiny new app called Spark launches tomorrow and vaguely promises to be Twitter 2.0, well no one would be willing to jump on unless it was free. Even $1 a month is too much for us short-attention-spanned smartphone users, as the total shift to F2P games on mobile has shown us. Nothing outside of Minecraft is in the top 100 grossing apps on Android nor iOS. Perhaps the answer lies in starting free, getting people hooked, and then easing in a subscription fee? This would also come across as a bait-and-switch, as you said, and some users would inevitably flock to the next free clone. Ultimately, and unfortunately, I don't think there's an easy answer to monetization anywhere...

devishard 10y ago
> However, as a game developer with Free-To-Play development PTSD, I think this rule rests on an implied-but-important condition: People are already using and loving the service. No, that's exactly not what I'm saying. Uber did just fine starting as a pay service as do a great many games, Netflix, HBO, Amazon, etc. > Imagine that some shiny new app called Spark launches tomorrow and vaguely promises to be Twitter 2.0, well no one would be willing to jump on unless it was free. Right--that's because Twitter 2.0 is also fucked from the beginning: they don't have something users would pay for any more than Twitter 1.0 did. > Even $1 a month is too much for us short-attention-spanned smartphone users, as the total shift to F2P games on mobile has shown us. Nothing outside of Minecraft is in the top 100 grossing apps on Android nor iOS. F2P is basically just an advertising strategy; I'd count that as having something people are willing to pay for, because they're willing to pay for in-game purchases or premium experience subscriptions. > Perhaps the answer lies in starting free, getting people hooked, and then easing in a subscription fee? This would also come across as a bait-and-switch, as you said, and some users would inevitably flock to the next free clone. I guess I wasn't clear about this, but I think a bait-and-switch business strategy will work fine if you have something people value enough to pay for. It's kind of pointless, though, IMHO, because it doesn't fail fast: if it turns out you aren't providing people anything they value, then you won't find that out until you get to the "switch" part. Ultimately, I think the bait-and-switch strategy is just a way to extract money from VCs and offload risk onto them without having to prove your value proposition, but that comes at some significant cost. If I were a VC I'd probably want to invest to build something and then release it for pay up front--that saves the cost of implementing the bait-and-switch strategy. > Ultimately, and unfortunately, I don't think there's an easy answer to monetization anywhere... The answer is "provide value that people are willing to pay for", but I agree that's not an easy answer. :)

tedunangst 10y ago

Is that not exactly what app.net is? They have hardly taken all of Twitter's users.

devishard 10y ago
Neither of them provide value people are willing to pay for, so that's unsurprising.
nhangen 10y ago
It was the reverse of what the OP suggested. Twitter is still free, and App.net charged people a fee to use it.

fusiongyro 10y ago

App.net briefly tried to be a paid-for Twitter clone. I guess they've sort of pivoted from that model but it was an interesting idea at the time. And obviously it didn't work, because free is cheaper than non-free.

devishard 10y ago
Yeah. But even if they both charged the same amount of money, I think they'd just both go out of business, because nobody is going to pay for what either has to offer.
- fusiongyro 10y ago
  I want to disagree with you, but I paid for app.net and then didn't use it... so I guess I can't.

cmurf 10y ago

I think overall this is decently convincing, the problem I have with it though is the Uber example. Uber is bleeding money and clearly subsidizing rides. If people were paying the true cost of what drivers are paid plus some reasonable mark up, I have serious doubts it'd be as popular as it is. And case in point, I don't use Uber in NYC. Friends and colleagues don't either. It's usually easier and cheaper to get a cab. So... if Uber becomes more expensive than it is now, let alone more than a cab, I think broadly speaking most people will vote for the less expensive option rather than the service with the shiny app.

devishard 10y ago
Yeah, I think that having a product people would pay for is a prerequisite to success, but it's not a guarantee of success. I definitely think Uber could lose to a competitor in their product space. The distinction I'm making here is that I don't think anyone will ever succeed over the long term in Twitter's product space, because they don't have a product people would pay for. A competitor might knock them out for a little while, but no competitor will have lasting success unless they figure out a way to modify Twitter's product into a product people would pay for. And at it's core, Twitter's product is kind of worthless, so I don't think there's a modification that would make it worthwhile.

virtualwhys 10y ago

> there would be a clone written in a more scalable architecture Curious, what would be more scalable than Twitter's existing JVM based architecture? 3 years ago[1] they were able to handle upwards of 140 (edit) thousand tweets per second without any latency -- that's pretty ridiculous. [1] https://blog.twitter.com/2013/new-tweets-per-second-record-and-how https://blog.twitter.com/2013/new-tweets-per-second-record-a...

StyloBill 10y ago
143 000 tweets/second. Not 140 millions.
devishard 10y ago
I didn't explain that well--initially Twitter was on RoR and sharded MySQL, which wasn't scalable. Obviously they have done a lot of scaling work and can handle their load now. If I were implementing Twitter today, I'd probably do Elixir and Cassandra. I don't generally leap to go NoSQL but Twitter's structure is particularly suited to Cassandra. Elixir gives the ease of development I associate with Ruby with the scalable, decentralizable BEAM. I'd also consider going with Erlang straight up--it may not be as pretty as Elixir, but there's a lot to be said for maturity in a language. But I'm saying this because I have the benefit of newer technologies and having seen Twitter's mistakes. From a technical perspective, I think Twitter is pretty well done.