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The rumours of charging for using Facebook have been circling for some
time, but is there any truth to them? Is Facebook in need of more
money, is it running at a loss as it is suggested of Youtube? The crux
of the matter is that (nearly) every website wants to make money and,
as Ben suggests, since we live in a Capitalist society, this is only to
be expected. So, what is the next step for Facebook, are we going to
end up paying to use it? And what will we get when we do?
Facebook offers a service to its users; we can upload and share photos
and videos, keep in touch with people around the world and share
interests with people we may never have met. What, in my eyes, Facebook
lacks, is a niche. That may sound strange considering it has attracted
over 175 million users. But this is its fatal downfall. It will
struggle to charge for a service that can be found anywhere. If we
compare this to Flickr, Flickr has a niche. Photos and videos. Period.
Flickr has professionals; users who need the extras offered by the pro
account available; extra storage, higher resolution, archiving, image
replacement, original image storage and retrieval. The list goes on.
They can charge because they know people need the service. The regular
user survives happily on his 200MB monthly upload limit, everyone is
happy.
Facebook has nothing that can be extended, nothing that can be charged
for, in the sense of Flickr. They cannot suggest charging you if you
want to make more than X posts a month, or create Y albums a month. It
wouldn’t work. Facebook has no professionals. Facebook is a general
networking tool that REQUIRES its base of tools to work; it requires
them to work because it is the tools which make it what it is. Flickr
isn’t Flickr because of the extra storage you get if you pay; it is
Flickr because of the platform it offers in the first place.
When it comes to monetizing the site as it is now, it pulls in the
advertisers for the very fact that people spend over 20 minutes a day
on the site on average, that it has access to 17% of the internet’s
reach for the last 3 months, and each user clicks to a new page at
least 10 times, equalling 10 opportunities to see an advert. http://www.alexa.com/siteinfo/facebook.com.
You only need to look at the demographic that uses Facebook to know
that you have a fair chance of finding your target audience as an
advertiser. That is, anyone you want. As the 4th most used site on the
internet, how can an advertiser resist. Whether these advertisers see
returns on their investment is of course another issue, and one which
may well be the real cause for concern for Facebook’s funding.
Business gurus will always say that you can lower your prices if you
start high, but raising them without any due cause is going to be
difficult, and you will lose customers. If we start paying for exactly
the same service we've always been getting, people aren't going to a)
do it or b) be happy. If we start having to pay, we should expect a
large increase in functionality from a platform which already tries to
be every web 2.0 social media site in one.
Click here for Bens first article which started the discussion
Click here for Scotts article
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