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When GitHub's financials got leaked in 2016, GitHub's personal accounts accounted for 12.5% of their revenue. GitHub Enterprise was 50%, their organization (= b

When GitHub's financials got leaked in 2016, GitHub's personal accounts accounted for 12.5% of their revenue. GitHub Enterprise was 50%, their organization (= business) accounts were the remaining 37.5% [1]. It's fair to say that the personal accounts are irrelevant from a revenue perspective. [1] https://medium.com/@moritzplassnig/github-is-doing-much-better-than-bloomberg-thinks-here-is-why-a4580b249044 https://medium.com/@moritzplassnig/github-is-doing-much-bett... (disclaimer: I wrote the article but the data is by Bloomberg)

nambit 8y ago
12.5% is still a significant percent of revenue.
- nindalf 8y ago
  Significant... but the main threat to the other 87.5% is that developers try out Gitlab or other alternatives for their personal projects. These developers find that Gitlab is pretty good, and don't push their companies to pay for Github. Whereas if every developer starts out using Github exclusively for personal projects, it becomes the default choice when they start work. With this change, Github foregoes a little revenue in exchange for securing the vast majority of their revenue.
  - sokoloff 8y ago
    Exactly this. Just this weekend, I setup my first CodeCommit (AWS) repo because I needed a private git repo for a new project and didn't want to pay github for it. It turned out to be damned easy (and very cheap) and that's a serious threat to github's future growth because once people start to default elsewhere for one type of their work, it tends to drag along other types of their work.
  - philwelch 8y ago
    That was always the case, though. It's just that Github's network effects were always powerful enough to counteract this effect. But, for one very obvious reason, people have grown more and more interested in finding alternatives to Github, and they're forced to compete.
- kemitche 8y ago
  Unless it's shrinking as devs realize other platforms offer a free version of the same service. Especially if those devs decide that they like the new platform better, and convince their company to use it.
- jjcm 8y ago
  It is for a lot of companies, but not at the scale of Microsoft. Keep in mind companies like Google/MS/Apple/etc kill products that have 10s of millions of revenue because while it's a ton of money, it's a drop in the bucket compared to their other sources of revenue. 12.5% of their 300M revenue is a tiny amount for MS to absorb to solidify themselves against their competitors as the main open source hub. Gitlab and Bitbucket both heavily positioned themselves against Github with their unlimited private repos feature. With this competing with Github is going to become much harder. I think it's a smart move for MS.
beagle3 8y ago
In what world is 12.5% of revenue "irrelevant"? The 37.5% business revenue is just 3 times as much (so almost as irrelevant), and Enterprise is only 4 times is much (again, almost as irrelevant). Unless .. all github revenue is irrelevant for Microsoft - which might be true, for all I know.
- sqs 8y ago
  I bet it's much less than 12.5% now (since 2016). Also, individual user revenue is revenue that public investors value less than revenue from businesses, because there is perceived to be a much bigger overall market (and therefore more future potential growth) in selling to businesses rather than individuals. And growth is what matters for the stock price. Source: I am the CEO of Sourcegraph and consider similar things.
  - woolvalley 8y ago
    What I've always found funny about "B2B is more valuable than B2C" is how all economic value eventually comes from B2C eventually, and all the meta B2B tools in between don't really make value independently on their own.
    - jjeaff 8y ago
      Yes, but all consumers eventually get their money from companies. So.... But in reality, the source of your customers' income has little to do with value. B2B is favored because the margins are generally higher.
- fnord123 8y ago
  >In what world is 12.5% of revenue "irrelevant"? Meh, just fire 12.5% of the staff. /s
- yellowapple 8y ago
  That might indeed be true. GitHub's value to Microsoft ain't the revenue; it's the users, the mindshare of whom Microsoft hopes to capture by luring them toward the Microsoft ecosystem (Windows, Office, Azure, SQL Server, etc.). As a particular former Microsoft CEO put it: "[…] DEVELOPERS DEVELOPERS DEVELOPERS DEVELOPERS […]". That strategy/desire hasn't exactly stopped, though it's certainly transformed quite a bit over the last couple decades (and Microsoft is finally actually getting somewhat effective there).
geezerjay 8y ago
> It's fair to say that the personal accounts are irrelevant from a revenue perspective. Your assertion can only make sense if you also believe that a 12% paycut is irrelevant to your income.
- femto113 8y ago
  Revenue != income. It's quite likely the profit margin on developer accounts is lower than the other types, and if this cuts the knees out from under the competition may well be cheaper than, say, paying for advertising.
  - jjeaff 8y ago
    But that is a non-sensical argument unless you are saying that making all those accounts free will somehow reduce the overhead related to the personal accounts. Seems like it will in fact increase costs as more people sign up.
  - fnord123 8y ago
    >if this cuts the knees out from under the competition All of Github's competitors (i.e. gitlab and bitbucket) already offer unlimited private repos. This is Github catching up.
    - ausjke 8y ago
      Exactly,while it is dramatic for github, it has to do this because of competitions.
    - hyperpallium 8y ago
      I was thinking that Bitbucket still has its promise to always be free. However, I don't think it will be an issue. As hosting costs drop to zero, if someone starts charging, they lose customers to a free competitor. (as is happening here).
    - scarface74 8y ago
      As well as MS’s own Azure Devops aka VSTS as well as free hosted builder servers, private package repos, project management, etc. for up to five users.

nambit 8y ago

12.5% is still a significant percent of revenue.

nindalf 8y ago
Significant... but the main threat to the other 87.5% is that developers try out Gitlab or other alternatives for their personal projects. These developers find that Gitlab is pretty good, and don't push their companies to pay for Github. Whereas if every developer starts out using Github exclusively for personal projects, it becomes the default choice when they start work. With this change, Github foregoes a little revenue in exchange for securing the vast majority of their revenue.
- sokoloff 8y ago
  Exactly this. Just this weekend, I setup my first CodeCommit (AWS) repo because I needed a private git repo for a new project and didn't want to pay github for it. It turned out to be damned easy (and very cheap) and that's a serious threat to github's future growth because once people start to default elsewhere for one type of their work, it tends to drag along other types of their work.
- philwelch 8y ago
  That was always the case, though. It's just that Github's network effects were always powerful enough to counteract this effect. But, for one very obvious reason, people have grown more and more interested in finding alternatives to Github, and they're forced to compete.
kemitche 8y ago
Unless it's shrinking as devs realize other platforms offer a free version of the same service. Especially if those devs decide that they like the new platform better, and convince their company to use it.
jjcm 8y ago
It is for a lot of companies, but not at the scale of Microsoft. Keep in mind companies like Google/MS/Apple/etc kill products that have 10s of millions of revenue because while it's a ton of money, it's a drop in the bucket compared to their other sources of revenue. 12.5% of their 300M revenue is a tiny amount for MS to absorb to solidify themselves against their competitors as the main open source hub. Gitlab and Bitbucket both heavily positioned themselves against Github with their unlimited private repos feature. With this competing with Github is going to become much harder. I think it's a smart move for MS.

beagle3 8y ago

In what world is 12.5% of revenue "irrelevant"? The 37.5% business revenue is just 3 times as much (so almost as irrelevant), and Enterprise is only 4 times is much (again, almost as irrelevant). Unless .. all github revenue is irrelevant for Microsoft - which might be true, for all I know.

sqs 8y ago
I bet it's much less than 12.5% now (since 2016). Also, individual user revenue is revenue that public investors value less than revenue from businesses, because there is perceived to be a much bigger overall market (and therefore more future potential growth) in selling to businesses rather than individuals. And growth is what matters for the stock price. Source: I am the CEO of Sourcegraph and consider similar things.
- woolvalley 8y ago
  What I've always found funny about "B2B is more valuable than B2C" is how all economic value eventually comes from B2C eventually, and all the meta B2B tools in between don't really make value independently on their own.
  - jjeaff 8y ago
    Yes, but all consumers eventually get their money from companies. So.... But in reality, the source of your customers' income has little to do with value. B2B is favored because the margins are generally higher.
fnord123 8y ago
>In what world is 12.5% of revenue "irrelevant"? Meh, just fire 12.5% of the staff. /s
yellowapple 8y ago
That might indeed be true. GitHub's value to Microsoft ain't the revenue; it's the users, the mindshare of whom Microsoft hopes to capture by luring them toward the Microsoft ecosystem (Windows, Office, Azure, SQL Server, etc.). As a particular former Microsoft CEO put it: "[…] DEVELOPERS DEVELOPERS DEVELOPERS DEVELOPERS […]". That strategy/desire hasn't exactly stopped, though it's certainly transformed quite a bit over the last couple decades (and Microsoft is finally actually getting somewhat effective there).

geezerjay 8y ago

> It's fair to say that the personal accounts are irrelevant from a revenue perspective. Your assertion can only make sense if you also believe that a 12% paycut is irrelevant to your income.

femto113 8y ago
Revenue != income. It's quite likely the profit margin on developer accounts is lower than the other types, and if this cuts the knees out from under the competition may well be cheaper than, say, paying for advertising.
- jjeaff 8y ago
  But that is a non-sensical argument unless you are saying that making all those accounts free will somehow reduce the overhead related to the personal accounts. Seems like it will in fact increase costs as more people sign up.
- fnord123 8y ago
  >if this cuts the knees out from under the competition All of Github's competitors (i.e. gitlab and bitbucket) already offer unlimited private repos. This is Github catching up.
  - ausjke 8y ago
    Exactly,while it is dramatic for github, it has to do this because of competitions.
  - hyperpallium 8y ago
    I was thinking that Bitbucket still has its promise to always be free. However, I don't think it will be an issue. As hosting costs drop to zero, if someone starts charging, they lose customers to a free competitor. (as is happening here).
  - scarface74 8y ago
    As well as MS’s own Azure Devops aka VSTS as well as free hosted builder servers, private package repos, project management, etc. for up to five users.