Thursday, May 15, 2008

Freedom has its limits

About a month ago, I posted on the in vogue theory that we're moving to a free model for, well, everything. This has been pushed by Chris Anderson of Wired, but others have also weighed in with their belief that bandwidth and storage and software are moving to a free model, where value-added activities provide revenue. I expressed doubt about this, that Google mail space is not actually part of a market, but something subsidized by other activities. The new theory is akin to saying that cereal boxes are moving to a zero-cost model, since you're only paying for the cereal inside.

For more evidence of this, consider the web site Griddlers are puzzles, also known as Tsunami, Paint by Numbers, or Nonograms, in which a grid is surrounded by numbers that are used to deduce which squares in the grid should be filled. It's pretty interesting, somewhat mathematical, certainly more intriguing than Sudoku. I have delved into these somewhat, being an inveterate puzzler, and they're pretty addictive. And the best web site I've seen is the aforementioned (I'll call it gnet from here for convenience), which is extremely well programmed.

gnet has been free during its five or six years of existence, never using ads to generate revenues (other than some mentions of their own griddler products). A while ago, they created a new application, and, rather than offering it free, they decided to move to a subscription model:
Our goal is for Griddlers to continue to be the highest quality site of its kind. We have been thrilled by your response. It has remained free, because we want to share this enjoyment with everyone. But, all of this success comes at a cost.

The increased use puts a very heavy load on our server. If we want a site that performs well and can continue to grow and improve, we need to upgrade soon and this will be expensive.

Even though all the puzzles on our site are free, after considering many options we decided to make the New Applet availabe uniquely to subscribers. If you want to use it fully, you’ll need to become a subscriber.

All Griddler-lovers will be welcome on the site whether you subscribe or not. Most of the features you currently enjoy will still be available. New features will be created especially for our Subscribers.
To reiterate what they said above, the existing functionality was still available to non-subscribers (except they did sharply reduce the number of puzzles a free user could save). But it was pretty obvious that innovation was going to be slanted toward subscribers. A subscription is not particularly onerous, $40 a year, but it was still a dramatic change to the model.

About a week ago, they made another change: the selection filter to omit puzzles that have already been solved was taken away from non-subscribers. For people who have done a lot of puzzles, this is a major change, as now they have to search through every puzzle in a category to find one they haven't done yet. The explanation:
During rush hours you can see 1300-1400 people online. They try to find their solved puzzles amongst 50,000,000 records and select their type of puzzles from dozens of thousands of records. By all means it is a huge task.

Our resources are limited. As much as we try to upgrade the site, the speed of growth is faster then us. Note, that all the work on the site has been done voluntarily. However, maintaining and hosting a large site like ours cost money. Making a subscription is actually giving life to the site.
What is interesting here is how this bucks the so-called trend. This site has been free, then features were added that are available only to subscribers, now functionality is being removed. And this is why the "free" model is unsustainable - everyone has to agree that everything is free before any one thing can be. If gnet were receiving free server space, they might not have to make the changes.

One wonders how this site started. Did the founders start it as a hobby, then found it got away from them? Perhaps the initial development was interesting enough to do for free; now that the tasks are largely maintenance, they'd like to be compensated.

I don't find anything wrong with the model they're adopting. They're still providing some service to those who won't or can't pay, but one does wonder how much functionality they can remove from the free version before their customers become dissatisfied (actually, from the comments that were left about this change, some people are already planning to walk away, though I would think it will be a small number).

But this is the same model as, for example, we're seeing now in Chicago about telecasts of Cubs baseball games. The team used to offer 144 games a year (out of 162) for free on broadcast television. Now the number's down to 60, with the rest offered on cable, and the 15% or so who don't have cable are out of luck.

It's dangerous to take a couple of examples and assume they represent a trend, but it is also risky to assume that "everything will be free." I'm sure could adopt an ad-driven model, but, for some reason, they haven't. My guess is that modern technology will actually permit different kinds of models, that some sites will insist on subscriptions for full functionality, others will become free (with copious ads or attempts to sell added value), some may go to transaction-based pricing.

But the attempts of some big thinkers to get us to accommodate ourselves to an inevitable "free" model may well reflect their desire to be in on the next big thing far more than a realistic appraisal of where we actually are going.

1 comment:

Anonymous said...

more nonograms:

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