7 ms·

I think paid email services are a great idea, but $50 a year and 2 GB of storage for Fastmail seems expensive to me. Why not something closer to five or ten buc

I think paid email services are a great idea, but $50 a year and 2 GB of storage for Fastmail seems expensive to me. Why not something closer to five or ten bucks a year? Can someone explain to me why this type of pricing makes sense?

onion2k 8y ago
Pricing 101: Price has nothing to do with the cost of providing the service, and everything to do with the value the customer puts on what they're buying. The value you put on email is $10/year, so Fastmail doesn't represent good value. Other people obviously think its worth more. Fastmail are providing their service to those people.
- charmides 8y ago
  I need to respectfully disagree with you here. In a free market, pricing does have something to do with the cost of providing a service because companies that overcharge would quickly lose market share to competitors, especially in a wildly competitive space like email. Also, ten bucks a year has nothing to do with how much I'd personally be willing to pay for email. It is just my estimation of the amount you could charge people while still keeping healthy profit margins in this industry, however I don't have much domain knowledge regarding email and that figure could be very wrong. I'd love to hear from an expert.
  - onion2k 8y ago
    ...companies that overcharge would quickly lose market share to competitors This is only true for companies offering equivalent products, and that is never the case in tech because there are so many intangible factors. In this case, one of Fastmail's intangible benefits is that they're not Google. Maybe Fastmail's customers think that's worth $50 ... but it has zero impact on Fastmail's costs.
  - ggm 8y ago
    In a free market Bzzt. Notice how everyone recommended fastmail and nobody else? It's not a highly competitive free market. It's "hi, can anyone recommend a MacBook cheaper than the one apple make" time. Free markets reductionism not useful with no serious competitive pressure
    - SmellyGeekBoy 8y ago
      Email seems like more of a free market than most things considering the incredibly low barrier to entry. You can even host your own email server, you can't reasonably do that with a lot of the software that you use every day. Just because a particular provider is good and cheap and has a lot of satisfied customers doesn't make it any less of a free market.
      - ggm 8y ago
        It just feels like a truism. Absent a formal regulation oversight any market is free in these terms. Were not comparing Japanese gold plated apples and trader Joe floor dropping oranges with mould on, were looking for competition in the sense BMW competes with Mercedes and Lexus. Google is giving away some thing of huge value, which is highly reliable spam free email. They "charge" your privacy which is beyond price. If you seek equivalent functionality the software cost alone for the one I regard as comparable is 350 dollars which as a purchase amortised out is $10 a month over three years but I have to spend another $10 a month to host it, and I still have a single point of failure. So price wise fastmail may be enormously good value or expensive depending how you feel: there are not a heap of competent competitive alternates. Maybe five? Sure, that's a competitive market in Herfindahl Hirschman Index maybe? But in practice it's not far off a duopoly. Google or o365, fastmail or proton. It's a pair of competing entities not one market.
      - pbhjpbhj 8y ago
        >You can even host your own email server // As long as you don't want deliverability to Gmail or Outlook addresses. Though you can pay for Outlook deliverability it seems. They're very pinickety about allowing mail through from self-hosted or even low-traffic shared hosting IME [albeit limited].
i_made_a_booboo 8y ago
Because if you have 10,000 customers paying $50 that's much nicer than having 100,000 customers paying you $5.
- SmellyGeekBoy 8y ago
  Certainly in the case of email where the cost of providing the service has pretty much a linear relationship with the number of users.
mping 8y ago
$50 gets you 25Gb according to their pricing page.
miffe 8y ago
$50/y gets you 25 GB of storage.
wasd884 8y ago
It does seem expensive when you've been exposed to free (or heavily discounted) prices your whole life. This is because the others still charge this much, except the difference in revenue is made up by selling your data and pushing adverts (rather than charging you extra). Suddenly the extra $30-$40 per year doesn't seem so expensive any more.
- charmides 8y ago
  I guess that selling user data and advertisements is worth more per user than I realized.
pmorici 8y ago
The Fastmail pricing tiers are $3, $5, and $9 per month which is $36, $60, and $108 per year respectively. If you look at their primary competition their prices are on par or slightly better. Here is a sampling... Google G Suite: $5, $10, and $25 per month per user. Microsoft: $4, $8, or $12.50 per month per user. ZOHO: $3, $7 per month per user billed yearly. [0] https://gsuite.google.com/pricing.html https://gsuite.google.com/pricing.html [1] https://products.office.com/en-us/exchange/compare-microsoft-exchange-online-plans https://products.office.com/en-us/exchange/compare-microsoft... [2] https://www.zoho.com/workplace/pricing.html?src=zmail https://www.zoho.com/workplace/pricing.html?src=zmail
- conatus 8y ago
  While they are on par for email, with Fastmail being superior in certain ways, you do get a deal more value from the Google G Suite as you get a lot more besides email incorporated in the price, i.e, cloud drive, the applications themselves etc. Thinking though this for a project I'm working on with a tight budget I concluded for money related reasons I'd probably have to go with Google even though I'd prefer not to.
  - pmorici 8y ago
    FastMail is more than just email. They include a drive like feature with the ability to make a basic website. I use G Suite for my side business and while it seems like a great deal because you get all these other apps, in practice, I have never used them, not once.
    - conatus 8y ago
      Oh really. Thanks for this. Will check it out. We are heavy users of Google Sheets and Docs already so I know these will be used immediately.
- TsomArp 8y ago
  Office365 family costs 10 per month for 5 users, with office desktop and web, with 1TB of space per user, and 60 minutes of skype per user...
sergiosgc 8y ago
Five or ten bucks a year is impossible to attain. The monthly cost of a hosted GB is about a cent. At 25GB, in a service with fast search and, I imagine, regular snapshots and backups, you'll be using up to 200% overhead. Assume that most accounts are not at 100% usage and, in the spirit of a Fermi estimate, set a typical usage of 50GB. You get to an yearly cost of $6. At $6 cost of hardware per account, now you have to factor in other costs and your profit margin. Support alone will bring you above $10. Marketing will also bring you above $10 on its own. At a decent scale, you can keep the marginal cost of engineering low (as it does not scale linearly), but on a mid-sized operation expect it to bring you above $10 on its own. All in all, $50/year is high but not stratospheric.
Johnny555 8y ago
Fastmail is $30/year for 2GB, $50/year for 25GB, and $90/year for 100GB of storage. https://www.fastmail.com/pricing/ https://www.fastmail.com/pricing/ If you have your own domain, you need to use the $50 or $90 plans.
leokennis 8y ago
I have to say: I like to be charged as much as FastMail charges. It gives me some sense that they will not be out of business or quit in a year or two. I like FastMail to still exist in 50 years.

onion2k 8y ago

Pricing 101: Price has nothing to do with the cost of providing the service, and everything to do with the value the customer puts on what they're buying. The value you put on email is $10/year, so Fastmail doesn't represent good value. Other people obviously think its worth more. Fastmail are providing their service to those people.

charmides 8y ago
I need to respectfully disagree with you here. In a free market, pricing does have something to do with the cost of providing a service because companies that overcharge would quickly lose market share to competitors, especially in a wildly competitive space like email. Also, ten bucks a year has nothing to do with how much I'd personally be willing to pay for email. It is just my estimation of the amount you could charge people while still keeping healthy profit margins in this industry, however I don't have much domain knowledge regarding email and that figure could be very wrong. I'd love to hear from an expert.
- onion2k 8y ago
  ...companies that overcharge would quickly lose market share to competitors This is only true for companies offering equivalent products, and that is never the case in tech because there are so many intangible factors. In this case, one of Fastmail's intangible benefits is that they're not Google. Maybe Fastmail's customers think that's worth $50 ... but it has zero impact on Fastmail's costs.
- ggm 8y ago
  In a free market Bzzt. Notice how everyone recommended fastmail and nobody else? It's not a highly competitive free market. It's "hi, can anyone recommend a MacBook cheaper than the one apple make" time. Free markets reductionism not useful with no serious competitive pressure
  - SmellyGeekBoy 8y ago
    Email seems like more of a free market than most things considering the incredibly low barrier to entry. You can even host your own email server, you can't reasonably do that with a lot of the software that you use every day. Just because a particular provider is good and cheap and has a lot of satisfied customers doesn't make it any less of a free market.
    - ggm 8y ago
      It just feels like a truism. Absent a formal regulation oversight any market is free in these terms. Were not comparing Japanese gold plated apples and trader Joe floor dropping oranges with mould on, were looking for competition in the sense BMW competes with Mercedes and Lexus. Google is giving away some thing of huge value, which is highly reliable spam free email. They "charge" your privacy which is beyond price. If you seek equivalent functionality the software cost alone for the one I regard as comparable is 350 dollars which as a purchase amortised out is $10 a month over three years but I have to spend another $10 a month to host it, and I still have a single point of failure. So price wise fastmail may be enormously good value or expensive depending how you feel: there are not a heap of competent competitive alternates. Maybe five? Sure, that's a competitive market in Herfindahl Hirschman Index maybe? But in practice it's not far off a duopoly. Google or o365, fastmail or proton. It's a pair of competing entities not one market.
    - pbhjpbhj 8y ago
      >You can even host your own email server // As long as you don't want deliverability to Gmail or Outlook addresses. Though you can pay for Outlook deliverability it seems. They're very pinickety about allowing mail through from self-hosted or even low-traffic shared hosting IME [albeit limited].

i_made_a_booboo 8y ago

Because if you have 10,000 customers paying $50 that's much nicer than having 100,000 customers paying you $5.

SmellyGeekBoy 8y ago
Certainly in the case of email where the cost of providing the service has pretty much a linear relationship with the number of users.

mping 8y ago

$50 gets you 25Gb according to their pricing page.

miffe 8y ago

$50/y gets you 25 GB of storage.

wasd884 8y ago

It does seem expensive when you've been exposed to free (or heavily discounted) prices your whole life. This is because the others still charge this much, except the difference in revenue is made up by selling your data and pushing adverts (rather than charging you extra). Suddenly the extra $30-$40 per year doesn't seem so expensive any more.

charmides 8y ago
I guess that selling user data and advertisements is worth more per user than I realized.

pmorici 8y ago

The Fastmail pricing tiers are $3, $5, and $9 per month which is $36, $60, and $108 per year respectively. If you look at their primary competition their prices are on par or slightly better. Here is a sampling... Google G Suite: $5, $10, and $25 per month per user. Microsoft: $4, $8, or $12.50 per month per user. ZOHO: $3, $7 per month per user billed yearly. [0] https://gsuite.google.com/pricing.html https://gsuite.google.com/pricing.html [1] https://products.office.com/en-us/exchange/compare-microsoft-exchange-online-plans https://products.office.com/en-us/exchange/compare-microsoft... [2] https://www.zoho.com/workplace/pricing.html?src=zmail https://www.zoho.com/workplace/pricing.html?src=zmail

conatus 8y ago
While they are on par for email, with Fastmail being superior in certain ways, you do get a deal more value from the Google G Suite as you get a lot more besides email incorporated in the price, i.e, cloud drive, the applications themselves etc. Thinking though this for a project I'm working on with a tight budget I concluded for money related reasons I'd probably have to go with Google even though I'd prefer not to.
- pmorici 8y ago
  FastMail is more than just email. They include a drive like feature with the ability to make a basic website. I use G Suite for my side business and while it seems like a great deal because you get all these other apps, in practice, I have never used them, not once.
  - conatus 8y ago
    Oh really. Thanks for this. Will check it out. We are heavy users of Google Sheets and Docs already so I know these will be used immediately.
TsomArp 8y ago
Office365 family costs 10 per month for 5 users, with office desktop and web, with 1TB of space per user, and 60 minutes of skype per user...

sergiosgc 8y ago

Five or ten bucks a year is impossible to attain. The monthly cost of a hosted GB is about a cent. At 25GB, in a service with fast search and, I imagine, regular snapshots and backups, you'll be using up to 200% overhead. Assume that most accounts are not at 100% usage and, in the spirit of a Fermi estimate, set a typical usage of 50GB. You get to an yearly cost of $6. At $6 cost of hardware per account, now you have to factor in other costs and your profit margin. Support alone will bring you above $10. Marketing will also bring you above $10 on its own. At a decent scale, you can keep the marginal cost of engineering low (as it does not scale linearly), but on a mid-sized operation expect it to bring you above $10 on its own. All in all, $50/year is high but not stratospheric.

Johnny555 8y ago

Fastmail is $30/year for 2GB, $50/year for 25GB, and $90/year for 100GB of storage. https://www.fastmail.com/pricing/ https://www.fastmail.com/pricing/ If you have your own domain, you need to use the $50 or $90 plans.

leokennis 8y ago

I have to say: I like to be charged as much as FastMail charges. It gives me some sense that they will not be out of business or quit in a year or two. I like FastMail to still exist in 50 years.