We don't need a new business model! The existing business model is working fine: when I tell people how many of our active users have paid us, they refuse to believe me, because we beat the industry average for freemium products by at least 20 points. The problem is that the prices our users pay us were set in 2009 when we opened, and the prices we pay for services are set in 2024, when we are paying them. You can see the difference yourself: when we set the prices pre-launch, in January of 2009, the $35 a regular paid account costs yearly was worth $35. Today, that $35 is the equivalent of if we had set our prices at $23.48 for a year of paid time. Likewise, the $50 of a premium paid account in January of 2009 is worth $33.54 today.
For quite a long time, the improvement in the cost of disk space, transfer, computing power, etc, was outpacing inflation, and we didn't have to adjust prices. That stopped being the case approximately four years ago at the start of the pandemic, and the trend hasn't reversed itself. We're still taking in enough money to cover our operating costs, but the difference has been getting smaller and smaller each year, and one of the possible ways to address that is to realign the prices with the reality of having been in business for 15 years without having adjusted the prices for inflation once. It's not the approach we're settled on! But nearly every service that's been around as long as we have has raised their prices and/or cut back their offerings multiple times since 2009 to reflect the changes in purchasing power, while ours have remained the same, and adjusting the prices to reflect what they would be if we opened the site today is one of the potential methods to address the issue before it becomes more of a problem.
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For quite a long time, the improvement in the cost of disk space, transfer, computing power, etc, was outpacing inflation, and we didn't have to adjust prices. That stopped being the case approximately four years ago at the start of the pandemic, and the trend hasn't reversed itself. We're still taking in enough money to cover our operating costs, but the difference has been getting smaller and smaller each year, and one of the possible ways to address that is to realign the prices with the reality of having been in business for 15 years without having adjusted the prices for inflation once. It's not the approach we're settled on! But nearly every service that's been around as long as we have has raised their prices and/or cut back their offerings multiple times since 2009 to reflect the changes in purchasing power, while ours have remained the same, and adjusting the prices to reflect what they would be if we opened the site today is one of the potential methods to address the issue before it becomes more of a problem.