Wednesday, October 08, 2014

Why I Think Ello and Medium Will Ultimately Fail

+Medium looks like a very interesting blogging platform. It is. There are great indepth articles on there. Great people sharing great content. For free.

Whenever I come upon a website with no ads, my first, immediate thought is: 'How are they making money?' Call me jaded or cynical, but I know nothing is really free, even on the internet. With ads I know what I'm dealing with. So, what is Medium's business model?

Social Media for Public Relations 1

I couldn't find a concrete answer, but I did find educated guesses. Allegedly, Medium will be accepting money to make content part of their Editors’ Picks collections. It really seems a bit counterintuitive to their claim that great content rises to the top regardless of who writes it if they allow people to pay for the top spots.

I have the same problem with the new kid on the block, Ello. This new, minimalistic, and optimistic social network claims to want to keep things simple. No ads as well. Their future business model? Microtransactions for website features. Every gamer knows 'microtransaction' is lingo for 'you can't enjoy the game until you pay', with very few exceptions.

I think both these models rely on people's urge to just share things for free. You sure aren't going to be making any money on any social network if you have to pay for it, unless you already have a strong product that can recuperate the cost and would benefit from a more social kind of dissemination.

For all my protests though, I'm not saying these business models are inherently bad. It's all in how they'll be implemented, in striking the balance between profitable and enjoyable. The most commonly used alternative is clearly not all roses anyway.

Advertising is shady. It relies on manipulation. You give your data in exchange for ads tailored to you. Maybe you'll find that one great product you didn't know you needed. Maybe you won't. Either way, when you look at an ad on your favorite website, you can rest assured that visualizing it helps pay the site's bills and even if you don't click and buy for any individual one, it has a worthwhile enough return on investment that companies are still willing to pay for ad spots. That's what I call a 'meh'-win-win.

I guess it's a wait and see game. Maybe Ello and Medium will be hugely successful and prosperous and users will love it and not feel pressured to buy anything or have their content overshadowed by paying customers'. Maybe they'll flop. 

What I do know that the big bucks will only come if there's a community big enough that it becomes worthwhile to give time, effort, and money to the platform in question. Time will tell. There are no absolutes, only speculation.