locked Re: Pricing Changes #update


Marv Waschke
 

I think 2020 will mark the beginning of the great free online services shakeout. The services aren't free and the current methods of paying for them are all pretty flaky: selling ads that most people regard as annoyances, selling information for targeting ads, subsidizing free services by paying for them out of paid services. This last is the Groups.io model.

The economics of online services are unfamiliar and strange to most folks. The biggest costs are upfront development before the first customer signs on. Next comes infrastructure rollout and system maintenance. The marginal cost of adding a new group or member to  Groups.io is probably very low, almost zero, which makes it tempting to offer free services. But when enough new groups or members are added, a breaker trips and a new round of software and infrastructure is required and that costs big. I suspect this is happening all over the online services industry as covid has driven everything online.

My guess is Groups.io is facing this now with the rush from Yahoo Groups.  I've been concerned about Groups.io's business model from the day the groups I work with moved here and it appears a day of reckoning is on the horizon. I hope Mark can come up with a sustainable plan under which users pay their fair share.

My preference (wishful thinking?!) is for a pay-as-you-go business model under which there is always an adequate reserve fund to pay for required expansion. Perhaps a relatively large entry fee, which would be designed to fund future expansion and modest monthly fees based on usage, which would be designed to keep the lights on in the data center.

I recognize that there are many many deserving groups that have no means to pay for the services I envision, but I would not saddle Groups.io with deciding which groups deserve what. I'm not sure Groups.io is in a good position to judge. Keeping a service running, paying the bills, planning and implementing for the future is a hard job, and the skills to do that are not the same as the skills necessary for equitably managing a charity. Maybe there should be a Groups.io Foundation for managing free services to deserving groups. The foundation would raise and manage funds to pay Groups.io fees.

So, yeah, a switch to a model like this would be rough, but from my vantage point. we're already in rough times that could get rougher if this stuff is not sorted out. I'd hate to see Mark throw up his hands, shutter Groups.io, and take a signing bonus to go to work for the big three.

Best, Marv Waschke

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