Subject: RE: The Pledge model -- K5 generates 6 mos income in three days
From: "Morhous, John" <morhous@fmedr.com>
Date: Wed, 26 Jun 2002 08:57:34 -0400

> Admittedly, K5's costs are low, and the core costs are 
> largely those of keeping Rusty, Bret, and cats fed.  The 
> donated bandwidth, hosting, and hardware can be looked at as 
> a corporate underwriting, also not unheard of in the public 
> broadcasting model.  

Public broadcasting, as in an NPR/PBS-like model? Interesting comparison,
never really looked at it in that way. The only difference I see is that
NPR/PBS has to provide content to a wide-range of audiences in order to keep
afloat, while K5 has a much narrower target. Given that, I don't think the
K5 target is enough to keep the site sustained with a continued "pledge"
model. Doesn't NPR/PBS use gov't money as well?

In regards to the infrastructure costs, I agree that's its not "unheard" of
to get it provided for free, but I don't expect it to be something we will
continue to see down the road. Telcom is hurting big now (welcome
Worlcom/UUNet to that club)--the "free services for ad placement" idea just
won't stick in the current climate. K5 has a sweet deal now, but I'd be
interested to see how long it lasts.

> I'd be 
> happier seeing commercial sales/support based on Scoop 
> myself, but having tried that route in an earlier life (and 
> somewhat living it presently), I'm aware of the pitfalls of 
> this model as well.  Support is hard.

You hit the nail right on the head--people always think a good way out is to
derive some commercial product from the entire thing, but the "details" of
product development, marketing, support, etc, always come back to bite them.
Especially hard for people that are mainly interested in developing
software.

Personally, I think the entire K5 situation is _really_ interesting... the
entire nature of the site draws direct comparisons to the open source
business model... content derived from the community, provided back to the
community in an "open" and "free" mentality, anyone can pitch in and
contribute.

The general lack in support of the community, when push-comes-to-shove, for
ponying up hard cash to help pay for the _real_ operational costs of
sustaining the business, is disturbing to say the least.

K5 shouldn't have had to plea for users, people should have been registering
just because they enjoyed the site. But I suppose that was proven not to be
the case.

-JTM