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Disk Space Upgrades [Mar. 7th, 2005|04:13 pm]
Paid Members

paidmembers

[jproulx]
If you're interested, we're asking people to help us test our new disk space upgrade purchase options. More details can be found in fotobilder_user.
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Comments:
[User Picture]From: asmor
2005-03-08 12:42 am (UTC)
The pricing seems a little wonky...

Let's take the very basest of plans, so we're not complicating things with volume discounts.

2 months, 250 megabytes, $10

That works out to 2 cents per meg per month.

Your 2 month paid account costs $5 and includes 100 megabytes. At 2 cents per meg per month, that means $4-- fully 80%-- of the fee just goes to a feature that I would bet a very small amount of paid users actually utilize.

Therefore, it seems to me there are two possibilities... Either you're charging people more than you should be by charging them for a service they probably don't need, or you're charging to much for disk space. I'll be the first to say that Livejournal is an absolutely bargain, even at $5 for 2 months (and I get the $25 for 12 months option), so it seems to me that you guys are charging way more than you should be for disk space.

Of course, this is just my two cents, and I should also probably mention that there is little chance of me purchasing an upgrade in disk space regardless of the price as I just don't need it.
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[User Picture]From: neojng
2005-03-08 12:44 am (UTC)
No I totaly agree with you. Thats alot of money for such little space.
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From: uxsquared
2005-03-08 01:01 am (UTC)

My "two cents" (heh heh, that's not a clever title)

Well-said.

Also, from a cost-analysis perspective, a paid member pays 2.5 cents per Mebibyte per month for his or her 100 Mib of storage space. ($5/100/2). An extra 250 Mib (for paid members only, of course) works out to an additional 2.0 cents per Mib per month. ($10/250/2)

Put this way, the paid storage space doesn't sound like that bad of a deal. But since paid accounts are 1.5% of LJ accounts, and this 'feature' is available only to paid members ... and since the 100 Mib limit is *plenty* for 99% of paid members, the LJ staff is breaking their backs over something very, very few people will actually take advantage of.
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[User Picture]From: foxx
2005-03-08 01:07 am (UTC)

Re: My "two cents" (heh heh, that's not a clever title)

You can get storage for less than a third of a penny per megabyte per month. So, really, this is a HUGE ripoff, and LJ image hosting seems very unreliable to me.
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From: uxsquared
2005-03-08 01:13 am (UTC)

Agreed.

Yeah. Pound for pound, it's cheaper for a paid user to download his or her phoneposts, and then upload them onto a server, then add a link to that third-party host to his or her journal.

I don't know what the lj-staff is trying to accomplish here. *shrug*

LJ image hosting is an awesome feature, but it still has some serious reliability issues which need to be resolved.
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[User Picture]From: foxx
2005-03-08 01:04 am (UTC)
Agreed--you can get a Dreamhost package with 120GB bandwidth per month and 2400 MB storage, and a free domain registration for $8... a month, but it's WAY better than what LJ is offering. :(
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[User Picture]From: tweedlekeys
2005-03-09 04:54 pm (UTC)
I think that LJ is doing something different from being a host though and so comparing between the two is like apples and some other fruit that looks a lot like apples.

LJ isn't trying to offer a hosting service like Dreamhost. LJ's space's value and difference lies with how it interacts with LJ. This space is great for people who want to lock a lot of pictures and make a lot of phoneposts (without worrying about moving them off later - a convenience issue). I suppose one wouldn't have to worry about bandwidth either should they create a super popular meme and have the pictures in LJ's space.

Right now I do have a Dreamhost account and the current amount of space is enough for me. However, as photobuilder and other space usage features mature, maybe there will be more demand for this service.
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[User Picture]From: foxx
2005-03-09 10:49 pm (UTC)
I might agree with you if the Fotobuilder software wasn't so flawed. Every paid account user on my friends list that has tried hosing an image or two, and nothing even large, gets a lovely red X most of the time.

I wouldn't be so skeptical if Livejournal's service actually worked. But working and Livejournal have been separate throughts for a while now.
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[User Picture]From: noweb4u
2005-03-08 01:09 am (UTC)
The trick here is that 99% of the users don't use the disk space. The 1% that do, use a decent amount (and don't forget the costs of bandwidth, if you upload a photo and post it, LJ's image hosting servers get a hell of a beating for the first few seconds as all your friends load the image.).
Thus, the 1% that do use it, and need more than 100MB, will be a significantly more serious load on the servers than someone who either doesn't use it at all, or uses it only periodically. So offering 100MB to everyone for free with their account is a loss leader in a way. Get you hooked on the service, and when you become a heavy user, you pay. Think of the 100MB as free, since LJ could not reasonably support every paid user using up their entire 100MB quota as it stands right now. That would be in the upper stratosphere of terabytes, if not petabytes (according to the stats page, that would take about 9.8 Petabytes, if I did the math correctly).

Summary: the free 100MB is only economical because the majority won't come close to using it. Those who do, pay more, since they're a far more siginificant strain on the system.
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From: uxsquared
2005-03-08 01:20 am (UTC)
"The first hit of heroin is always free." -- an old, wise friend of mine

Your entry makes a lot of sense. I come nowhere near my quota limit anymore, only because I don't make a lot of phoneposts like I once did. I do use the Image Hosting feature a lot, but I don't have a lot of publicly-viewable galleries.

Boy, the lj-staff must love a guy like me. :( Maybe I should start taking advantage of their storage space ... after all, I'm paying top-dollar for it!!
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[User Picture]From: homunculus
2005-03-08 01:50 am (UTC)
haha, nice icon.
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[User Picture]From: njyoder
2005-03-08 01:21 am (UTC)
That's ridiculous, it's not a loss at all. They take all of this into account in their business model. It's a principle called overselling, bandwidth providers do it all the time. So does every other company that offers storage space. Companies ALWAYS oversell by such a wide margin that they make a huge profit. So they took into account that 1% of heavy users in their calculations so that they'd still make a hefty profit.

Plus storage space is cheap as hell, even terabytes are cheap. You can get reasonable priced 1/3rd terabyte hard drives now. They are GROSSLY overcharigng here and there is no amount of justification for it. They can take all the strain at current income and profit well. This is just a scam under the guise of "testing" to get people to buy space they don't need.

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[User Picture]From: asmor
2005-03-08 01:31 am (UTC)
I wouldn't say it's a scam... there's certainly nothing forcing you to use their service. Anyone who does even a little bit of shopping around will see much better deals available.
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[User Picture]From: njyoder
2005-03-08 01:24 am (UTC)
I agree, they are grossly overcharging here. With cheap multi-hundred gigabyte hard drives now, there's no justification for this, even with lots of RAID redundancy. It's about US$0.0007 per MB for a $200 300GB hard drive. 2 cents per MB per MONTH is insane.
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[User Picture]From: njyoder
2005-03-08 01:41 am (UTC)
To clarify, I'm talking about 0.07 CENTS not DOLLARS. That's a 31400% mark up.
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