![[staff profile]](https://www.dreamwidth.org/img/silk/identity/user_staff.png){kind=small}
Entry tags:
Weekly Update: 6 April
Hello, Dreamwidth! I'd like to start this update by wishing my wife ![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png)
sarah a belated happy birthday (putting her on the spot in front of tens of thousands of people) -- her birthday was Saturday, and she had a very good one.
Anyway, we've got a full update this week, so on we go!
Behind the cut:
* Development
* Technical Debt
* Biz Update
* Seed Accounts
* Styles Class
* Invite Codes
* Antispam
* Our Support for LiveJournal
* Our Farewell to Inksome
* Sad News
Since last we spoke, we've had one code tour:
March 17, 2011 - March 31, 2011, done bypoulpette
This code tour includes (hopeful) fixes for the problems people were having with their comment import from LiveJournal timing out, an update and overhaul of the Presentation section in the Customize Journal page, and some major, massive, epic work to modernize our JavaScript sitewide. Which brings me to:
I've seen a few people lamenting the lack of new user-facing features lately, or wondering why it's taking us so long to release features we said we were going to release. This absolutely isn't a sign that DW development is slowing down, or that we're working less hard or accomplishing fewer awesome things. The reason it seems like we haven't had any major feature releases lately is because we've been working hard on things that, if we do them right, you won't ever see -- backend improvements that are critical for us to do before we can do all the new feature work.
Basically, we are working on paying down our technical debt. For those of you who don't know, technical debt is a metaphor used in the software development world for the maintenance and improvements you delay for a future time in order to get code or software shipped now. Because we forked from LiveJournal, we inherited a decade's worth of delayed maintenance that we need to make good on in order to continue forward. We could keep delaying it, but we've reached the point where it's more work to continue working around the problems than it is to fix it.
We've spent the last six months aggressively working on modernizing the code and improving the backend, which is putting us in a much better position to go forward. The project's not completely done yet, but we're getting there! Most of the fixes and improvements are things you guys won't ever see, because there aren't any user-facing changes. But once we're finished, we'll be in a much better position to do feature development much more rapidly.
That's the short explanation -- if you'd like a longer one, I wrote an entry that gets into a lot more detail. You can read that here: Technical debt and the making of payments on it.
So, tax time is upon us, and that means that we've finalized the 2010 books and the results are in. We're cautiously pleased with how things wound up: in 2010, we very nearly broke even for the year, in terms of "money earned vs money spent", and we would have broken even or had a slight profit if it weren't for the three months of being unable to accept payments.
(For those of you who are just tuning in: in January of 2010, PayPal decided that they would no longer do business with us unless we agreed to censor the content our users posted to remove material that did not violate our Terms of Service, but bothered them. We declined, and in the end, we had nearly three months of downtime in which we couldn't accept online payments until we could implement our alternate solution.)
I've posted the 2010 Year End Update in![[site community profile]](https://www.dreamwidth.org/img/comm_staff.png)
dw_biz, in which I go into some more detail about our expenses, our results, and some of the various factors that meant we didn't actually see all the money we took in this year. If you're interested in the "behind the scenes" aspect of where your payments go and how we handle the business end of things, head on over.
We've had multiple people ask us about seed accounts (permanent accounts) lately, and whether or not we ever plan to offer them again. When we started Dreamwidth, the plan was to sell them once -- at the site launch -- and never again unless something major happened; this was to prevent seed account sales from cannibalizing future revenue.
Well, something major happened -- the three months where we were unable to accept payments did eat a lot into our operating fund, and various other factors since then have been nibbling at the reserve. (See thedw_biz post I linked in the previous section for more information there!) In order to replenish that reserve, and make sure that we have the resources to continue to expand through the rest of 2011 instead of just stagnating, we will be putting a limited number of seed accounts on sale next month.
I know that no matter what I say, people are going to worry, but rest assured: we are not in financial trouble. Right now, we are on track to break even or make a modest profit in 2011. (Which is good -- our plan for when we started DW was that we wouldn't actually start seeing a significant profit until 2013 or so!) Rather, this move is to make sure that we have a reasonable reserve in the event of (God forbid) future disaster -- it was that reserve that let us stay on the air last year when we had our payments crisis, and the reserve never quite recovered from that depletion. Having that reserve back in place will let us sleep a lot more soundly at night.
Plans haven't been 100% finalized yet -- stay tuned for more announcements -- but right now, the tentative plan is to place 400 Seed Accounts on sale in four batches over a 24-hour period on April 30 - May 1, our two-year anniversary to launching our open beta. We'll be doing it in batches to make sure that our users in every time zone -- whether geographical or personal -- have at least one opportunity for a sale time that isn't in the middle of their night. Accounts will remain on sale for as long as it takes for the 100 accounts in each batch to sell out, whether it happens immediately or over time, and each new batch will be added to the previous. (So, if there are still 50 accounts left for sale from the first batch when the time for the second batch comes due, the 100 from the second batch will be added to the 50 left from the first batch.)
As with last time, seed accounts will cost $200 (the equivalent of four years of premium paid service). You'll be able to buy them for yourself or for a friend. (We chose that number because it's what we felt was the right balance between replenishing the reserve and not hurting future sales too badly.)
We'll give you more updates on when accounts will go on sale as we get closer to the end of the month.
(Edit: And someone in the comments made me realize I hadn't mentioned: a Seed Account is functionally equivalent to a Premium Paid account, and receives the same benefits. It just won't ever expire. Also, if you have existing paid time when you buy a Seed Account, you can contact us to either transfer the paid time to another account, or have it converted back to Dreamwidth Points.)
Have you been wanting to learn how to customize your style more than the wizard will let you do, but haven't quite gotten around to figuring out how? Or do you have the image of the perfect style in your head and haven't been able to make it a reality?
foxfirefey is starting up a course on the DW style system and how to work it in ![[community profile]](https://www.dreamwidth.org/img/silk/identity/community.png)
style_system. You can view the proposed syllabus to see if it's something you might benefit from. It's a low-pressure, no-commitment-necessary way to learn how to play around with making things pretty.
As many people no doubt noticed, we released another batch of invite codes earlier this week. This time we distributed 1 invite code each to all personal accounts that had been active in the last 30 days. You don't need to save the email you got -- you can always view all your invite codes at the Invite Someone page, linked on all site-skinned pages.
Invite codes don't expire; you can save them for personal use or invite a friend. Or, if all of your friends have already joined you on Dreamwidth, you can share them indw_codesharing.
We've seen a small uptick in the amount of spam being posted to the service, and the "no invite codes" week does seem to have had a small "logged-in spammer" result. (I'm guessing it took time for the result to become apparent, since much spam software will create an account and then let it lie dormant for a bit before posting.)
Our antispam team has been smacking down the spammers as fast as they rise, but this is a good time for yet another reminder! If you receive spam -- whether in comments or in posts to your community -- be sure to pick the "mark as spam" option while you're deleting it. That will put the comment or post into the antispam system, where our antispam team will leap upon it so fast that it's often dealt with within minutes. (No, really. They have an irc bot to alert them to new spam and everything. It's kind of frightening sometimes.)
I'd also like to take a few minutes to publicly offer support to LiveJournal, where the team has been doing an incredible job in responding to and mitigating a Distributed Denial of Service (DDoS) attack. If you haven't been able to reach LJ in the past few days, this is why; the current theory in the press is that the DDoS is a political statement being made against Russian-language bloggers using LJ as their platform. We wish the LJ team luck, perserverence, and a bottle of really good top-shelf liquor in trying to combat the problem.
We've seen increases in the number of people using the content importer to back up their content from LJ over the past few days, and with LiveJournal inaccessible during periods of heavy DDoS traffic, this can cause a problem with imports timing out or not otherwise succeeding. We'd like to ask you to consider holding off on starting a new import for a few days, until the problem can clear up a bit. Our importer is smart enough to retry an import a few times if the process times out before giving up completely, but minimizing the traffic that LJ needs to cope with can only help them out.
This week also will see the closing of Inksome, another site based on the LiveJournal code. Kit and Shell, the owners and operators of Inksome, have been awesome to us throughout, and they've been great to share ideas with over the years. We'll miss you guys, and we wish you luck.
It's with regret that I announce the loss ofpadme_kenobi, a member of the Dreamwidth community. She suffered from Epidermolysis Bullosa, an incredibly rare genetic disorder. Her friends remember her as an incredibly positive force in the world; we are made lesser by her passing.
*
That's it from us for now! As always, if you're having problems with Dreamwidth, Support can help you; for notices of site problems and downtime, check the Twitter status page; if you've got an idea to make the site better, you can make a suggestion.
We'll see you in two weeks for our next update.
sarah a belated happy birthday (putting her on the spot in front of tens of thousands of people) -- her birthday was Saturday, and she had a very good one.Anyway, we've got a full update this week, so on we go!
Behind the cut:
* Development
* Technical Debt
* Biz Update
* Seed Accounts
* Styles Class
* Invite Codes
* Antispam
* Our Support for LiveJournal
* Our Farewell to Inksome
* Sad News
Development
Since last we spoke, we've had one code tour:
March 17, 2011 - March 31, 2011, done by
poulpetteThis code tour includes (hopeful) fixes for the problems people were having with their comment import from LiveJournal timing out, an update and overhaul of the Presentation section in the Customize Journal page, and some major, massive, epic work to modernize our JavaScript sitewide. Which brings me to:
Technical Debt
I've seen a few people lamenting the lack of new user-facing features lately, or wondering why it's taking us so long to release features we said we were going to release. This absolutely isn't a sign that DW development is slowing down, or that we're working less hard or accomplishing fewer awesome things. The reason it seems like we haven't had any major feature releases lately is because we've been working hard on things that, if we do them right, you won't ever see -- backend improvements that are critical for us to do before we can do all the new feature work.
Basically, we are working on paying down our technical debt. For those of you who don't know, technical debt is a metaphor used in the software development world for the maintenance and improvements you delay for a future time in order to get code or software shipped now. Because we forked from LiveJournal, we inherited a decade's worth of delayed maintenance that we need to make good on in order to continue forward. We could keep delaying it, but we've reached the point where it's more work to continue working around the problems than it is to fix it.
We've spent the last six months aggressively working on modernizing the code and improving the backend, which is putting us in a much better position to go forward. The project's not completely done yet, but we're getting there! Most of the fixes and improvements are things you guys won't ever see, because there aren't any user-facing changes. But once we're finished, we'll be in a much better position to do feature development much more rapidly.
That's the short explanation -- if you'd like a longer one, I wrote an entry that gets into a lot more detail. You can read that here: Technical debt and the making of payments on it.
Biz Update
So, tax time is upon us, and that means that we've finalized the 2010 books and the results are in. We're cautiously pleased with how things wound up: in 2010, we very nearly broke even for the year, in terms of "money earned vs money spent", and we would have broken even or had a slight profit if it weren't for the three months of being unable to accept payments.
(For those of you who are just tuning in: in January of 2010, PayPal decided that they would no longer do business with us unless we agreed to censor the content our users posted to remove material that did not violate our Terms of Service, but bothered them. We declined, and in the end, we had nearly three months of downtime in which we couldn't accept online payments until we could implement our alternate solution.)
I've posted the 2010 Year End Update in
dw_biz, in which I go into some more detail about our expenses, our results, and some of the various factors that meant we didn't actually see all the money we took in this year. If you're interested in the "behind the scenes" aspect of where your payments go and how we handle the business end of things, head on over.Seed Accounts
We've had multiple people ask us about seed accounts (permanent accounts) lately, and whether or not we ever plan to offer them again. When we started Dreamwidth, the plan was to sell them once -- at the site launch -- and never again unless something major happened; this was to prevent seed account sales from cannibalizing future revenue.
Well, something major happened -- the three months where we were unable to accept payments did eat a lot into our operating fund, and various other factors since then have been nibbling at the reserve. (See the
dw_biz post I linked in the previous section for more information there!) In order to replenish that reserve, and make sure that we have the resources to continue to expand through the rest of 2011 instead of just stagnating, we will be putting a limited number of seed accounts on sale next month.I know that no matter what I say, people are going to worry, but rest assured: we are not in financial trouble. Right now, we are on track to break even or make a modest profit in 2011. (Which is good -- our plan for when we started DW was that we wouldn't actually start seeing a significant profit until 2013 or so!) Rather, this move is to make sure that we have a reasonable reserve in the event of (God forbid) future disaster -- it was that reserve that let us stay on the air last year when we had our payments crisis, and the reserve never quite recovered from that depletion. Having that reserve back in place will let us sleep a lot more soundly at night.
Plans haven't been 100% finalized yet -- stay tuned for more announcements -- but right now, the tentative plan is to place 400 Seed Accounts on sale in four batches over a 24-hour period on April 30 - May 1, our two-year anniversary to launching our open beta. We'll be doing it in batches to make sure that our users in every time zone -- whether geographical or personal -- have at least one opportunity for a sale time that isn't in the middle of their night. Accounts will remain on sale for as long as it takes for the 100 accounts in each batch to sell out, whether it happens immediately or over time, and each new batch will be added to the previous. (So, if there are still 50 accounts left for sale from the first batch when the time for the second batch comes due, the 100 from the second batch will be added to the 50 left from the first batch.)
As with last time, seed accounts will cost $200 (the equivalent of four years of premium paid service). You'll be able to buy them for yourself or for a friend. (We chose that number because it's what we felt was the right balance between replenishing the reserve and not hurting future sales too badly.)
We'll give you more updates on when accounts will go on sale as we get closer to the end of the month.
(Edit: And someone in the comments made me realize I hadn't mentioned: a Seed Account is functionally equivalent to a Premium Paid account, and receives the same benefits. It just won't ever expire. Also, if you have existing paid time when you buy a Seed Account, you can contact us to either transfer the paid time to another account, or have it converted back to Dreamwidth Points.)
Styles Class
Have you been wanting to learn how to customize your style more than the wizard will let you do, but haven't quite gotten around to figuring out how? Or do you have the image of the perfect style in your head and haven't been able to make it a reality?
foxfirefey is starting up a course on the DW style system and how to work it in style_system. You can view the proposed syllabus to see if it's something you might benefit from. It's a low-pressure, no-commitment-necessary way to learn how to play around with making things pretty.Invite Codes
As many people no doubt noticed, we released another batch of invite codes earlier this week. This time we distributed 1 invite code each to all personal accounts that had been active in the last 30 days. You don't need to save the email you got -- you can always view all your invite codes at the Invite Someone page, linked on all site-skinned pages.
Invite codes don't expire; you can save them for personal use or invite a friend. Or, if all of your friends have already joined you on Dreamwidth, you can share them in
dw_codesharing.Antispam
We've seen a small uptick in the amount of spam being posted to the service, and the "no invite codes" week does seem to have had a small "logged-in spammer" result. (I'm guessing it took time for the result to become apparent, since much spam software will create an account and then let it lie dormant for a bit before posting.)
Our antispam team has been smacking down the spammers as fast as they rise, but this is a good time for yet another reminder! If you receive spam -- whether in comments or in posts to your community -- be sure to pick the "mark as spam" option while you're deleting it. That will put the comment or post into the antispam system, where our antispam team will leap upon it so fast that it's often dealt with within minutes. (No, really. They have an irc bot to alert them to new spam and everything. It's kind of frightening sometimes.)
Our Support for LiveJournal
I'd also like to take a few minutes to publicly offer support to LiveJournal, where the team has been doing an incredible job in responding to and mitigating a Distributed Denial of Service (DDoS) attack. If you haven't been able to reach LJ in the past few days, this is why; the current theory in the press is that the DDoS is a political statement being made against Russian-language bloggers using LJ as their platform. We wish the LJ team luck, perserverence, and a bottle of really good top-shelf liquor in trying to combat the problem.
We've seen increases in the number of people using the content importer to back up their content from LJ over the past few days, and with LiveJournal inaccessible during periods of heavy DDoS traffic, this can cause a problem with imports timing out or not otherwise succeeding. We'd like to ask you to consider holding off on starting a new import for a few days, until the problem can clear up a bit. Our importer is smart enough to retry an import a few times if the process times out before giving up completely, but minimizing the traffic that LJ needs to cope with can only help them out.
Our Farewell to Inksome
This week also will see the closing of Inksome, another site based on the LiveJournal code. Kit and Shell, the owners and operators of Inksome, have been awesome to us throughout, and they've been great to share ideas with over the years. We'll miss you guys, and we wish you luck.
Sad News
It's with regret that I announce the loss of
padme_kenobi, a member of the Dreamwidth community. She suffered from Epidermolysis Bullosa, an incredibly rare genetic disorder. Her friends remember her as an incredibly positive force in the world; we are made lesser by her passing.*
That's it from us for now! As always, if you're having problems with Dreamwidth, Support can help you; for notices of site problems and downtime, check the Twitter status page; if you've got an idea to make the site better, you can make a suggestion.
We'll see you in two weeks for our next update.
no subject
It would be easy to say "it doesn't feel cool" or "it doesn't feel Dreamwidth-y" - and that's how the announcement makes me feel about the situation - but that doesn't seem like a very constructive remark to me. More specifically, it feels like a triumph of pragmatism over idealism, and that's not what I hoped for from you.
no subject
We chose the number of seed accounts to sell now very carefully, after weighing our rate of growth, our paid account percentages, and our projections for the next few years, and I'm confident that we won't be cannibalizing future revenue to the point where it will be a danger. It's a trade-off, but running a business involves making trade-offs like that! I specifically plotted out our paid account and other rates of growth over time, halved the numbers to be on the safe side, and projected that out four years (since a seed account is the cost of four years of premium paid services), and the projected loss of future revenue is less than the difference between the amount we're taking in now and the amount we're projecting to be taking in by then and then some.
I don't think pragmatism and idealism are mutually exclusive, but if it were, in cases like this pragmatism would have to win. The DW userbase has trusted us to steer this ship, and part of that involves making sure to have a hedge against disaster. The operating fund is what allowed us to stay "on the air" in the beginning of 2010 without kowtowing to censorship demands, and having that safety margin against disaster is critical to us -- it's what enables us to have that idealism in terms of our principles regarding freedom of expression, freedom from advertising, and freedom from outside interests, among (many!) other things.
All of those principles are far, far more important to me than holding to a statement about seed account sales that wasn't even an absolute. I want us to have a comfortable enough margin that we could survive another episode like we went through in early 2010 if we had to. (While, of course, praying that we don't have to.) That, I think, is the far more responsible and Dreamwidth-y thing to do.
I certainly don't expect everyone to agree! And I know that some people will be worried. But we are currently ahead of the game, in terms of the timelines and projections we made in 2008-2009, and the only reason to be doing this now is the unexpected roadblock we had to deal with at the beginning of last year. It's something we never could have anticipated, and I think that we should be allowed a certain amount of leeway in the actions we take to recover from it.
no subject
I noted this, and it confirmed my decision to choose DW over other sites. I support your pragmatism in these economic times especially. Users are indeed relying on you to make good business decisions. But the fact that you didn't bow to the censorship demands of Paypal mean a great deal to a long-time fan.
no subject
What happened? Who's withholding your funds, and how is that even legal?
no subject
It's a private contract, so it's perfectly legal! The merchant bank is the one holding the funds, as a reserve against chargebacks. (There are two companies involved in us being able to take payments: the payment gateway, the service that replaced PayPal that does the actual "take card number from customer, run charge" process, and the merchant bank, which handles the disbursement of funds. Services like PayPal are payment gateways that don't require you to have an accompanying merchant bank account, but there are very few of them out there; most of them, and the one we replaced PayPal with, require you to have a merchant bank account that's able to accept the payments. As usual, Wikipedia has more.)
Basically: as an internet-only service, all of our payments are card-not-present transactions; as a service that accepts user-generated content and does not place restrictions on said content beyond "is it legal", we're coded as a service that's one step down from "porn producer" in terms of relative risk factor in the merchant bank's eyes. These two factors, taken together, are generally an indicator for "high risk of chargebacks" in the merchant processing world. Chargebacks cost the merchant bank a lot of money, so they're looking to minimize their risk. Card-not-present transactions increase the risk of fraud, while certain "high risk" market segments increase the risk of "social embarrassment" chargebacks (aka, parents/significant others/financial advisors/accountant/etc sees the subscription charge to the porn website on your credit card statement, and you insist that of course it wasn't you, someone must have stolen your card, and perform a chargeback).
So, until a business can establish their bona fides, and demonstrate a track record of low or no chargebacks, the merchant bank will hold a "reserve against chargeback". The money's still yours, it's just being held by the merchant bank as a reserve in case you turn out to be a chargeback magnet. In most cases, the requirement will be for a percentage of sales held as rolling reserve for the first 6 months of doing business with them, then for the next 3 or 6 months the reserve requirement is lifted (ie, all of your sales from that point onward are available for disbursement, but the funds that were held are still being held in reserve), and finally the money being held is released back to you.
We're in the "no more reserve being taken out of sales, but existing reserve amount is still being held" phase now. The funds should be eligible for disbursement soon, but since it's at the merchant bank's discretion, it's not a guarantee. It sucks, but it's the cost of doing business. :(
no subject
♥
no subject
(It's also why most merchants, us included, make it so clear that if people are unhappy with services they've purchased, they should just ask us and we'll do whatever it takes to make them happy. I mean, over and above just wanting to provide good customer service. The chargeback is sort of the tactical nuke of the credit-card processing world.)
And I never mind questions. :) It gives me an opportunity to wax tl;dr at people! (What can I say, it's a weakness.)
no subject
I enjoy reading all your tl;dr (oxymoronic? just a bit), especially when it's a morning full of writer's block.
no subject
(no subject)
proving you right ;)
Re: proving you right ;)
Re: proving you right ;)
no subject
no subject
That's the opposite of the impression I got at the time.
This whole discussion reminds me very much of the discussion we were having at roughly this time last year. Last year, there was strong agreement that you did not give that impression; this won't change over time.
You (the company, not the person) were considering another issue of Seed accounts this time last year - immediately after the three months of no income - but decided against it, and survived. What has changed over the last twelve months, other than the 25% of your takings from (if I interpret what you said correctly) April-to-October being held from you? Why, other than that 25%, do the reasons not do so from last year not apply just as strongly this year? (If nothing else has changed, but the effect of that 25% is enough on its own to make you think otherwise, that's fair enough.)
It's certainly relevant that your Operating Agreement requires you to keep your reserve fund sufficiently high, and that's justification by itself to do whatever you have to in order to make your reserve fund meet that criterion. Given that the payment processors have no objection to paying you this held money, even if not on demand, why do you not count it towards the reserve fund? How liquid does it have to be in order to make you feel comfortable?
I recognise that I'm holding you to a high standard here; please take it as a compliment.
no subject
What changed between then and now is another 9 months of nibbling away at the reserve (due to the reserve being held against the money we were taking in). At the time we decided to take the gamble and see if we could restock the reserve without having to resort to another seed account sale, and I was hopeful up to the very end, but the end-of-year accounting made it clear that no, while we came close to break-even, we didn't get the boost we'd been hoping for.
Also, as it stands now, we are very close to breaking even on money we take in vs money we spend for the entire year, but that isn't on a month-to-month basis -- in other words, we may do double or more our expenses in April, May, October, and November due to people renewing six and twelve-month paid accounts from either the initial launch or payments coming back online, but income during the other eight months can be half our expenses. Expenses are fixed from month to month, while income fluctuates. Above the need to hold a reserve against disaster, this is the other reason why it's so crucial to have a sizeable cushion, so that we can weather those ups and downs with more grace.
I'm just not comfortable calling money that isn't in our bank account and has no guarantee of being in our bank account any time soon a reserve. We don't know when that money will be released, and there is no clear strictures for the circumstances under which it will be released, so as far as I'm concerned, it doesn't exist until we either have it in hand or are given clear guidelines for when it will be. Nothing else has changed other than that -- we actually finished 2010 more close to breaking even than we would have in 2009 if one discounts the initial seed account sale -- but not having that money liquid makes me twitch. A lot.
no subject
It seems from the outside (without seeing your actual financials) that your capital structure is heavily reliant on equity, with little or no debt. Have you explored the option of a 4-year loan of $80k? This would provide the same amount of operating capital as 400 seed accounts, with a fixed payback period instead of a permanent loss of all future income of those accounts, $20k/year. If you consider this as a perpetuity you are obligated to pay, its present value must be calculated based on an expected interest rate. If we adopt a conservative 5% return as the rate, the aggregate present value of your seed account sales is ($20k/(0.05)), or $400k. The less interest one could expect to earn on the investment (or, the lower the rate at which you could get a loan), the higher this value is. How does this compare to the total cost over 4 years of the loan alternative?
What about leverage? I understand the reserve isn't available to you, but it still is an asset you own. Could it be used as collateral for a loan?
In a perhaps more intricate manner, could you float a sort of convertible bond issue? Say, $80k in $200 par bonds, in a number of series, that at maturity in 4 years are at your option payable in cash or convertible to seed accounts, with bondholders entitled to premium paid account services in lieu of interest payments? Or even annual payments of $50, which is equivalent to allowing the bondholder to choose whether to take payment in cash or services?
no subject
no subject
One of the most loved features of DW has always been its practical, healthy, and *sustainable* business model. Basing your income source on always needing new users isn't any of these, because to attract people you haven't attracted before, you have to become something you weren't before. This gives you a steady stream of short-term happy new members, and a long-term buildup of dissatisfied people who feel betrayed. The current DW model works well, because there is some scale point where the service is profitable at a given size, and can remain profitable indefinitely at that size by keeping the paying users it has at that time happy.
The idea of "social capital" is an interesting one, and a hard thing to quantify in business terms. As I've shown above, there is certainly a point of diminishing returns and even of negative value for additional social capital of this type, because once you've converted everyone into social capital, you have no more conventional income from your core offering. However, it would be interesting to examine the numbers and find out what contributions from permanent accounts at various services do have measurable monetary value, and in what amounts.
Ultimately, I think the important realization that's being overlooked on a lot of levels is that seed accounts are functionally a sale of equity. While they don't merit a claim on assets at liquidation as is usually understood in the definition of equity, they do constitute an ongoing claim on assets for as long as the business is a going concern. A certain portion of the resources of the company must be devoted to satisfying their requirements, and receives no compensation in return. In the world of economics, this is exactly the same as saying seed account holders receive annual income in the amount of the current yearly subscription price of the service.
Wow, I'm long-winded! tl;dr: "social capital" won't pay the bills, but it would be nice to have even an approximation to a value function for it.
(no subject)
(no subject)
(no subject)
(no subject)
no subject
Then again, I don't know much about how loans work so maybe I'm wrong?
(no subject)
(no subject)
(no subject)
(no subject)
no subject
Gulp. I like that in a political party, and get upset when people negatively criticise politicians for flip-flopping. I don't necessarily like that in a web site; again, I hold you to a higher standard, not least because more alternatives are available.
Slippery slope arguments are weak, so I'm going to try not to make one, but your compromising on ideals makes me wonder. You get tonnes of kudos for all the things you have done, and are doing, right; you might consider this a small matter compared to all the ways in which you have worked hard not to compromise, but even though this may be a relatively small matter, I don't consider it an absolutely small matter. On the other hand, I think I'm the only person to have shouted up and said so this year, so I recognise I'm in a small minority - but there were other people shouting up last year and I don't consider this to be a matter to be decided by the volume of the outcry.
Thank you for the explanation in paragraphs two, three and four.
no subject
I love LJ and have none of the objections to their policies that led a lot of people here, but I also really appreciate and love the more idealistic policies of DW and would love to be here even more than I love being there...but only if I have the security of a forever account.
I have CLUNG to that little exception you put in there, hoping that somehow you'd need another influx and I would stand a chance. So I will be there with bells on, hoping I get lucky and snag an account when the time comes.
no subject
I've been really wanted a couple more accounts, but I've been really hesitant about it.
no subject
no subject
no subject
And, ask my friends from LiveJournal, InsaneJournal, etc. and you generally find I am a huge blog site spender - far more than someone with a paid account on any site - overall. The 'Permanent Account' just means I won't be spending as much on me.
Examples: Back in InsaneJournal's time back when they regularly offered Permanently Insane accounts, I had my own. But I also hosted 'PI_Promo' where I gifted a permanent account once a month. They're more expensive now, but back then that was still $30/month toward other users.
And I never talk about how much I've spent on LiveJournal, but one friend makes a habit of taking horrified guesses, haha. I just spend it on other users. Let me just say two other users besides myself have PAs because of me. And that's not the whole deal either.
And I am way more active at both those places compared to here. Or at least was. I deleted my InsaneJournal eventually.
So I'm tempted with the Seed account thing. I just am not sure if it's in my budget since I donated most of my savings to the Red Cross last month, heh. We'll see how hours and everything go this April.
no subject
no subject
1. I get you're saying that PAs/PA equivalents don't always continue spending money on a site. As someone who has deleted a PA equivalent in the past, I can safely say that is true. However, you probably still spent more on that site than you would have if you just bought paid time during periods where you were active. And if something brought you back, you're not excluded from 'those who can spend money.' Statistically, you are more likely to spend money as a Paid/Permanent user compared to users who have never paid (which is the vast majority in blog sites).
2. An abandoned journal hardly accessed, regardless of account status, is hardly a huge load on any blog site's servers. So not deleting an account because it's 'permanent' (regardless of account status) isn't a huge load on the website.
3. Obviously, selling 'Permanent Accounts' at any blog site on a regular basis is bad for the site's financial health. But that's basically a non-issue at small batches released during times where a financial reserve is being built. That rare opportunity can, however, reel in some users (as described above) who spend more on sites when they have invested in a site's equivalent of a 'permanent' account.
4. Yeah, DreamWidth isn't exactly a hub of activity itself. That's never been an issue for me personally - my entries default to 'private' and I've never kept a journal really expecting any kind of audience. So to me it's more of a situation of how I think the site is run. I like how DreamWidth is run compared to InsaneJournal, and in many ways even LiveJournal. So I don't have much problem spending money on it.
Sorry for the wall of text. I'm not disagreeing - it works differently for different users, definitely - just saying that it isn't an irrelevant percentage of users this basic model works for. In small batches, it's basically harmless to the website as a whole and can reel some of those users in who otherwise probably would mostly maintain a free account status. All in all, that's not a sunk cost. (Regular availability would be a different story.)
Also, curiousity: what's the other account you are a 'permanent' user for?
(no subject)
(no subject)
(no subject)
(no subject)
(no subject)
(no subject)
(no subject)
(no subject)
no subject