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> 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% payc

> 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.
opencl 8y ago
12% of Github's income is ~0.001% of Microsoft's income.
- grenoire 8y ago
  12% of Github's income is 12% of Github's income.
  - wilg 8y ago
    12% of GitHub's income is 100% of 12% of GitHub's income.
  - quaristice 8y ago
    $20 is $20
    - mrccc 8y ago
      true === true
      - deleted 8y ago
        [deleted]
giobox 8y ago
If I’m reading the revenue chart correctly, 12.5 percent of their revenue was approximately 11 million dollars in 2016. At Microsoft, who is even going to notice that... There’s surely a goodwill factor and wider strategic benefits here beyond the relatively small amount of revenue - these individuals enjoying the free private repos will in many cases likely be future candidates for customers for the enterprise offerings etc, or one day find themselves involved in discussions regarding managed VCS for a larger org. Given Microsoft’s current strategy to win over developers, this seems like a pretty sensible move, and the price (for Microsoft) very low. Strategically this seems not entirely different to the free accounts AWS throw at university students. Once you have someone hooked on your free offerings, you can start locking them into the wider platform (Azure) much more easily. Again, pretty much the AWS playbook. Also, let’s not forget the 12.5 percent figure comes from 2016, a year which saw some pretty significant changes to GitHub’s offerings, such as unlimited personal repositories for paying users among other things. Prior to this you had to pay more to get more private repos. The number today may be somewhat different - I know my github spend went down following that change. Also, 12.5 percent of revenues - comparisons to a 12 percent pay cut are pretty misleading.
- jjeaff 8y ago
  Comparing 12.5% revenues to a pay cut is not misleading at all. Unless there is some reason to believe that making individual accounts free will somehow also reduce costs in a material way. Seems to me it will likely increase costs significantly as many more users will flock to create free private repos. In fact, it's more like giving you a 12% percent pay cut and then asking you to commute further to work.
  - giobox 8y ago
    Focusing solely on the impact to Github’s bottom line kinda misses the entire point of Microsoft wanting to acquire them in the first place. A decision like this has to be viewed in the wider context of Microsoft’s market strategy and the rest of their developer tool portfolio, of which Github is just one piece. If Microsoft just cared about short term gains, there were much better ways to blow 8 billion dollars.
benologist 8y ago
There's maximum probably only like hundreds of thousands of people who would pay $96/yr for git repos for their personal projects. Millions a month but their other revenue streams are more expensive and still growing and can keep growing so it was heading towards a rounding error % even though it was 12% a couple years ago.
andrei_says_ 8y ago
I imagine they are making predictions of enterprise business influx through new users who will take their personal private repos and possibly business (back) to github.
Spooky23 8y ago
It's probably shrinking dramatically on a percentage basis -- Microsoft's massive enterprise presence drive tens or hundreds of thousands of accounts.
csours 8y ago
My business may be able to spend 12% of revenue on advertisement.
coldtea 8y ago
>Your assertion can only make sense if you also believe that a 12% paycut is irrelevant to your income. Beyond a certain hand-to-mouth income it is (e.g. 150K vs 132K). And many people chose pay cuts over personally overworking or stretching their business too thin. The overly trivial point being behind the parent argument is that 100% of your revenue if better than less than 100%. Which is not always the case in business. Businesses and freelancer drop gigs all the time to concentrate on where their main income is coming from. If you have a difficult customer or few demanding customers that generate just 20% of your income, it's often wise to drop them to focus on your easier 80%.
bryanrasmussen 8y ago
Your assertion can only make sense if the same economic factors and reasoning that govern a private individual's pay also govern a large multinational organization's revenue.
dwild 8y ago
> Your assertion can only make sense if you also believe that a 12% paycut is irrelevant to your income. You only see the short term. I was on Github during my university, all my projects were there, my team mate were on there too, it was pretty great. When my student account expired, I decided to move everything to Gitlab. I didn't want to move but I won't pay 7$ a month to host my old school projects and some personal stuff. Now that I did move everything, I actually enjoy Gitlab quite a bit. What do you think I'm going to use if I start a commercial project? In the past I would have chosen Github, but now that I'm comfortable with Gitlab and see all its benefits, it's probably the one I would choose. Cutting that 12% may lose 12% in the short term, but in a few years, it's going to gain you much more than 12%.
- jkchu 8y ago
  I totally agree with you. And to add to your point, the impact of having a dominance in the market of "personal project repos" extends far beyond individual developers paying money on their personal accounts and/or becoming paying customers when they start their own companies. If you think about mid-sized software companies (~10-100 devs), if 80% of your developers have a strong preference for Github over Gitlab or Bitbucket, then that company is likely going to stick with Github or decide to move to Github eventually. I think this is where Github captures much more than that 12% revenue that they are giving up right now.
  - TheCoelacanth 8y ago
    Also, if the VP of Eng. or whoever is making the decision thinks of Github as the default git SaaS because it's what they have used since college, there's a good chance they will just go with Github without even evaluating alternatives.
- seem_2211 8y ago
  Yep, there's a reason companies like Autodesk and Microsoft et al give students thousands of dollars of software for free while they're students.
- pritianka 8y ago
Mountain_Skies 8y ago
It's a tradeoff. I took a 11% paycut to become a 100% remote worker. Completely worth it for me. Microsoft likewise likely believes the loss of 12% of GitHub's revenue is worth it in exchange for advancing toward their bigger goals.
tw04 8y ago
You're missing why Microsoft purchased github in the first place. It wasn't for the personal account revenue - which isn't even a rounding error on their earnings report even if it is 10x what it was when revenue was leaked in 2016 (at which point it was $17.5 million/year). If that WERE the reason, they'd be charging for visual studio code, not giving it away.
chmike 8y ago
GitHub's competitor is GitLab. The main argument in favor of GitLab is private repo with self hosted GitLab. That's a weak spot of GitHub that they addressed. Self hosting requires a server and competence. With this move they also undercut a revenue source of GitLab. Strategically, it's a brilliant move. From the user point of view it's also an excellent news.

> 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.

opencl 8y ago

12% of Github's income is ~0.001% of Microsoft's income.

grenoire 8y ago
12% of Github's income is 12% of Github's income.
- wilg 8y ago
  12% of GitHub's income is 100% of 12% of GitHub's income.
- quaristice 8y ago
  $20 is $20
  - mrccc 8y ago
    true === true
    - deleted 8y ago
      [deleted]

giobox 8y ago

If I’m reading the revenue chart correctly, 12.5 percent of their revenue was approximately 11 million dollars in 2016. At Microsoft, who is even going to notice that... There’s surely a goodwill factor and wider strategic benefits here beyond the relatively small amount of revenue - these individuals enjoying the free private repos will in many cases likely be future candidates for customers for the enterprise offerings etc, or one day find themselves involved in discussions regarding managed VCS for a larger org. Given Microsoft’s current strategy to win over developers, this seems like a pretty sensible move, and the price (for Microsoft) very low. Strategically this seems not entirely different to the free accounts AWS throw at university students. Once you have someone hooked on your free offerings, you can start locking them into the wider platform (Azure) much more easily. Again, pretty much the AWS playbook. Also, let’s not forget the 12.5 percent figure comes from 2016, a year which saw some pretty significant changes to GitHub’s offerings, such as unlimited personal repositories for paying users among other things. Prior to this you had to pay more to get more private repos. The number today may be somewhat different - I know my github spend went down following that change. Also, 12.5 percent of revenues - comparisons to a 12 percent pay cut are pretty misleading.

jjeaff 8y ago
Comparing 12.5% revenues to a pay cut is not misleading at all. Unless there is some reason to believe that making individual accounts free will somehow also reduce costs in a material way. Seems to me it will likely increase costs significantly as many more users will flock to create free private repos. In fact, it's more like giving you a 12% percent pay cut and then asking you to commute further to work.
- giobox 8y ago
  Focusing solely on the impact to Github’s bottom line kinda misses the entire point of Microsoft wanting to acquire them in the first place. A decision like this has to be viewed in the wider context of Microsoft’s market strategy and the rest of their developer tool portfolio, of which Github is just one piece. If Microsoft just cared about short term gains, there were much better ways to blow 8 billion dollars.

benologist 8y ago

There's maximum probably only like hundreds of thousands of people who would pay $96/yr for git repos for their personal projects. Millions a month but their other revenue streams are more expensive and still growing and can keep growing so it was heading towards a rounding error % even though it was 12% a couple years ago.

andrei_says_ 8y ago

I imagine they are making predictions of enterprise business influx through new users who will take their personal private repos and possibly business (back) to github.

Spooky23 8y ago

It's probably shrinking dramatically on a percentage basis -- Microsoft's massive enterprise presence drive tens or hundreds of thousands of accounts.

csours 8y ago

My business may be able to spend 12% of revenue on advertisement.

coldtea 8y ago

>Your assertion can only make sense if you also believe that a 12% paycut is irrelevant to your income. Beyond a certain hand-to-mouth income it is (e.g. 150K vs 132K). And many people chose pay cuts over personally overworking or stretching their business too thin. The overly trivial point being behind the parent argument is that 100% of your revenue if better than less than 100%. Which is not always the case in business. Businesses and freelancer drop gigs all the time to concentrate on where their main income is coming from. If you have a difficult customer or few demanding customers that generate just 20% of your income, it's often wise to drop them to focus on your easier 80%.

bryanrasmussen 8y ago

Your assertion can only make sense if the same economic factors and reasoning that govern a private individual's pay also govern a large multinational organization's revenue.

dwild 8y ago

> Your assertion can only make sense if you also believe that a 12% paycut is irrelevant to your income. You only see the short term. I was on Github during my university, all my projects were there, my team mate were on there too, it was pretty great. When my student account expired, I decided to move everything to Gitlab. I didn't want to move but I won't pay 7$ a month to host my old school projects and some personal stuff. Now that I did move everything, I actually enjoy Gitlab quite a bit. What do you think I'm going to use if I start a commercial project? In the past I would have chosen Github, but now that I'm comfortable with Gitlab and see all its benefits, it's probably the one I would choose. Cutting that 12% may lose 12% in the short term, but in a few years, it's going to gain you much more than 12%.

jkchu 8y ago
I totally agree with you. And to add to your point, the impact of having a dominance in the market of "personal project repos" extends far beyond individual developers paying money on their personal accounts and/or becoming paying customers when they start their own companies. If you think about mid-sized software companies (~10-100 devs), if 80% of your developers have a strong preference for Github over Gitlab or Bitbucket, then that company is likely going to stick with Github or decide to move to Github eventually. I think this is where Github captures much more than that 12% revenue that they are giving up right now.
- TheCoelacanth 8y ago
  Also, if the VP of Eng. or whoever is making the decision thinks of Github as the default git SaaS because it's what they have used since college, there's a good chance they will just go with Github without even evaluating alternatives.
seem_2211 8y ago
Yep, there's a reason companies like Autodesk and Microsoft et al give students thousands of dollars of software for free while they're students.
pritianka 8y ago

Mountain_Skies 8y ago

It's a tradeoff. I took a 11% paycut to become a 100% remote worker. Completely worth it for me. Microsoft likewise likely believes the loss of 12% of GitHub's revenue is worth it in exchange for advancing toward their bigger goals.

tw04 8y ago

You're missing why Microsoft purchased github in the first place. It wasn't for the personal account revenue - which isn't even a rounding error on their earnings report even if it is 10x what it was when revenue was leaked in 2016 (at which point it was $17.5 million/year). If that WERE the reason, they'd be charging for visual studio code, not giving it away.

chmike 8y ago

GitHub's competitor is GitLab. The main argument in favor of GitLab is private repo with self hosted GitLab. That's a weak spot of GitHub that they addressed. Self hosting requires a server and competence. With this move they also undercut a revenue source of GitLab. Strategically, it's a brilliant move. From the user point of view it's also an excellent news.