Bursts: No More Free Networks, Cuts 40% Of Staff"
TechCrunch on April 15, 2010 in
I could not say that I would have been taken by surprise when
reading the piece of news, quite the contrary. I started making
international school projects by email before the birth of WWW at the
beginning of the 1990s, and what I learned during this time span was
that no free lunch was ever served. It was the consumer who always paid
the costs in one way or another.
Ning was a good exampe of a free
service which was able to find a sufficient audience for
commercializing its services. They valued Ning at a price of 0,5 billion
dollars in April 2008. Now that the free services were abolished and
replaced by Ning's premium options the value may rise or sink depending
on the behavior of the consumers. Will free travellers leave Ning or
will they pay for the premium options?
There was the well-known
logic of web services behind the bubble. An attractive new tool was
first given to users free of charge. The number of the users grew
rapidly because the tool enabled creating of networks, and it was a good
innovation among the Web2.0 tools. Networking was never as easy as it
was with Ning. Coordinators of networks established a large number of
different networks in Ning. After all this hard work coordinators would not like the idea
to give up their network and lose the fruits of their work. Therefore, I
find it propable that coordinators try to convince their clients to
become customers of Ning, which means paying money for this service.
is also interesting to see if Ning's bubble predicted the future
development of the ”social media” as a whole. Even if the new Web2.0
tools were called ”social” media, they were not social at all, rather
collaborative. It was the US marketing machinery that gave the title
Web2.0 tools to those tools. Later the name was changed into ”social
media”. Speaking about collaborative tools, which they actually are,
was not so attractive.
I guess the big players of the Internet were
the real winners of the Web2.0 game. And the saying was ”The winner takes all”. After the countless number of small enterprises showed their
capacity in developing new Web2.0 services the big predators such as
Google, Microsoft, Apple appeared on the scene. One by one they bought
every succesful product either to use it or to eliminate a potential
rival. This was how they saved costs. Instead of developing services by
themselves they let others to work innumerable hours in the hope of
success. Only a few were lucky. The less fortunate could not survive but
they had to die out.
Am I right or am I right? You need to decide.