There is no wonder that the rules of the game were dictated by big players, like facebook or google. They taught ordinary internet users (the mass) that good quality (usable and well-designed) services could be free.
So, if you trying to establish another service for masses it must be free, and meet the de-facto standards of quality. Tweeter is a good example.
It is possible to charge users for some very special and unique service, but only for a limited time, because free (no-cost) alternatives will emerge sooner or later.
It seems to me, that if someone wants to build such service he should think about some market-place or ecosystem (like in adult segment), not for public services for masses, because this market is already divided by rich and strong players.
I'd argue that people have been taught to expect it to be free. When fundamental services like search, email, chat, etc. are provided to consumers for free, why shouldn't other services be free too?
Of course we know these services aren't really free; Google and Facebook still run their services on physical servers that have hosting costs. But by making their apps free and finding alternative revenue streams (i.e. selling data), they can set norms that harm competitors with less capital while making it easier to adopt new users (and collect more data).
Building a big Internet site and providing the service for free is great. It isn't impossible to do that and be successful. But why not have services that users pay for in addition to the free content? Surely there are some services where users who are getting what they need for free wouldn't be concerned with and likewise there are people who are willing to pay for "something more."
Right, but I think the point is that those free users are not a good analog for paying users. The things you learn from those free users will not help you figure out how to serve customers who will actually pay something for your service.
It's an interesting service but I feel that certain services, for example Twitter, should be free and here's the reason - hook people in free offerings and get them to pay for the other services. Market it in a way that if they don't throw in the paid services to their notification, it just doesn't make sense.
Free does make business sense in the web world when advertising was the primary revenue driver. You cannot sell meaningful advertising without meaningful inventory, so there is a period where you spend "free" with meaningful inventory.
The larger question is whether other business models require the same focus on building a free userbase before implementing the business model. For all those services that charge, it affects user behavior if you implement too early and may limit the market size of the product. But on the flip side, sometimes if you charge, it conveys a sense of value upon the product.
If twitter started charging from the get-go, it would not be as big or as useful of a service as it is now.
This is correct in my experience. It also cuts deeper than just advertising or selling user data. It's the classic exposure argument. Give me the service for free and someone else might pay for it who hears about the service through my social network.
As discussed elsewhere in this thread, this line of thinking can even be completely reasonable for various services that have low costs associated with the free offering. It's when the free offering costs a significant amount to operate that you start running into trouble.
yes, there is the necessity angle, that's true. But still, I think it holds for the most part, if you ask people if they would pay for a free service then that's absolutely content-free.
Something like facebook or twitter needs to be free in order to succeed, just like air needs to be free for you to live. Asking if someone would pay for air, facebook or twitter is a meaningless question, if you need it and you can only get it by paying for it then that's what you'll do, but in the case of facebook or twitter a free alternative would spring up overnight and run with your userbase.
If you pay nothing for a service, then you are the product. Facebook and Google are already providing enormous value for free, if you have an internet connection. Now they want to provide it for free even if you don't pay for your internet connection. This arrangement changes nothing about the consumer relationship.
Yet another dark side of the “free”, or “user is the product”.
This could be prevented by changing the law so that it treats any large enough social platform as a communication service provider, requiring it to provide open API with complete feature coverage. This would facilitate native feature-complete third-party cross-platform clients that don’t show any ads, and platforms would have to charge users because no one will be stupid enough not to use a client like that.
And once service is no longer free and cross-platform clients exist, the space will finally start resembling an actual free market—honest competitors will stand a chance, and actual end users will be able to vote with their wallet.
Can you give some examples of recent paid services that were popular and were shut down? I think the reason people intuitively believe this is because a free service has to do two things to be successful: provide a good quality, useful service to people, and provide a way to make money tied to that user base. A paid service really just has to provide a good quality, useful service - since that is what the people are paying for.
Providing something for free (even if in this case, you do pay in many ways) is not a shield from criticism. You can't compare a free service to no service but instead have to compare it to the possible alternative reality where that particular free service does not exist. This is distinction is especially important for areas where network effects effectively prevent any alternatives from gaining traction.
One way to look at it, if the idea of "free" is too troublesome, is to consider that at the outset people are paying with their time and attention.
You need to do something to attract users, and allowing non-paid usage may be cheaper than the cost of additional advertising that gets people to sign up and pay.
Agreed; so figuring out how to sustainably meet (and ideally exceed) people's basic needs is important to safeguard content production.
Meanwhile, I don't think consumer expectation of free service is likely to change, and expect there's a market for ad-free reimplementations of existing services.
>The market can't solve anything if the product is free
It can absolutely work. The product is not free. The product is our attention and internet services (Twitter/Google/Facebook) are competing for that limited supply of attention in order to sell it on to their advertising customers. We won't give our attention to them for free though, so they have to buy it by providing a service we want. If they don't provide an attractive enough service, we turn around and sell our attention to someone else. That's how this market works.
Why do you think users of these services create value for free? Maybe it's because the value created for free is less than the value they get out of using these services they create free value for. It is true that these services get money thanks to the aggregated value that is created by all their users but let's take facebook for example, they only make $48.76 per user per year as of 2015 [1]. If they were to pay their users, they could not pay them more than that per year. Not such an interesting deal for anyone involved, even if Facebook was turned into a cooperative with 0 profit. Users would only get $48.76 at best per year and as a non profit, Facebook would probably be way less efficient and therefor only offer half or maybe less than that.
Now Facebook could turn into a paid service and pay its users more but then it would have much fewer users and then way less money to offer and now we're back to paying users little.
Seems like the current deal isn't such a bad one, Facebook connects a massive amount of people around the world including poor immigrants with their family (I know a few) and in exchange these users create value for Facebook. It's a voluntary win-win situation for both parties. Adults entering mutually beneficial deals with each others and enjoying it, what's wrong with that?
A tiny nitpick: nothing is free, the internet users just pay with a different currency: their data and attention. Both of these things are much more valuable than most internet users think.
As far as a non-commercial internet goes... well, we can always hope. We just have to wrangle the means of content production and control (heh, heh, see what I did there?). The resources are there to do that and have a free (both as in beer and in freedom) and high-quality internet, what we are missing is... attention of the masses, the most expensive thing.
So, if you trying to establish another service for masses it must be free, and meet the de-facto standards of quality. Tweeter is a good example.
It is possible to charge users for some very special and unique service, but only for a limited time, because free (no-cost) alternatives will emerge sooner or later.
It seems to me, that if someone wants to build such service he should think about some market-place or ecosystem (like in adult segment), not for public services for masses, because this market is already divided by rich and strong players.
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