How well companies that offer something for "free" can do with a subscription option?
When there are so many "free" things on the web, one has to wonder how companies can keep their products up and running (or even if they can manage to get out of beta).
Some companies just don't. They close the service and tell the customers to get out of here:
Personal Media: Bluestring, Xdrive and AOL Pictures will be sunset. These consumer storage products haven't gained sufficient traction in the marketplace or the monetization levels necessary to offset the high cost of their operation. We have found that building media management applications within the context of a social experience is a more rapid and effective way to grow the business. For example, today the Bebo audience is uploading over three million photos per day. To effectively grow the XDrive online storage business we would need to focus on subscription revenues vs. monetizing through advertising revenue, and this business model is not in strategic alignment with our company's goals. We are exploring plans to migrate our users assets to ensure the best possible transition experience.
This is part of the memo AOL sent out to staff explaning the end of some of their services - including Xdrive an on-line storage service that offered 5 GB of storage free to anyone.
There's a reason why people buy external drives for home or buy Windows Home Server or NAS boxes. First broadband speed sucks around the world. Then the services don't work as expected or not as easily (Xdrive is only one that I know that could be mounted as a drive on your OS so you could just copy things from and to instead of having to open a browser window). And even so it was very unstable.
Which leads me to the next one: the on-line service businesses seem to be quite unreliable - unless they are a subscription service with a SLA, not a freebie. But even so sith happens.
When there are lots of free things, some won't last long.
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Yesterday I posted about Telecom New Zealand's lack of a "meter" for their mobile data. Here is something that I thought would illustrate the issue well...Let's say you rent a car on a monthly basis, for work. You agree to pay $49.95 a month if you drive up to 1,000 km per billing cycle, and $1 per km after this.
You decided on 1,000 km because you thought this could cover your average daily usage multiplied by the number of days in the month.
You get the car and notice there is no meter in it, but the rental agency tells you it's ok, they are monitoring it within their system, remotely.
You drive away. During 30 days you have no exact idea of how many kms you've done. You have to keep calling the company to find out how many kms you have driven so far, and calculate to see if you are still within the expected average.
Then you receive the monthly bill. You look through five pages for something that says "kms driven this month", but instead you find "times you started the car this month". And a charge for the rental.
Does it make sense?
No. Neither does Telecom New Zealand's "data sessions" line in the bill. They don't tell us how many megabytes or gigabytes we used during the month, only how many times we used it during the period.
Telecom, are you going to fix your systems?
Read MoreShould State insurance offer 'market value' payouts on a set amount policy?
My parents car was recently involved in an accident where their car received significant damage after a truck hit the car. No one was hurt but we got the details, went to the police and got the stuff rolling.
The car is sitting in my driveway, not safe for road use.
Anyway, the insurance policy was insured for a set value rather than market value. The assessor for state insurance (IAG?) has basically offered approximately $5600 for repairs or replacement. This is below the set amount that was insuranced and the assessor only viewing the exterior of the car and not assessing potential damage to the car. The understanding is that anything above ~$5600 would be out of pocket.
When we contacted the assessor for further comment, he advised that this was because the car was only worth a certain amount, a market value and that we are lucky that we got offered that amount. That would be ok if it wasn't insured for a set value.
Clearly state insurance can't have their cake and eat it too? To me it sounds like a scam.
Whats your thoughts?
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