I can only speak for myself, but I don't use facebook even though it's free. I don't particularly need gratuitously large social networks made up largely of people I don't really know. Sites like facebook, reddit, and even this one to a much lesser degree mostly just distract me from getting things done at the computer.
When people ask me why I'm not on Facebook, I usually tell them that Facebook is like a really high-maintenance girlfriend without the upsides. Twitter is the only "social network" (if you can quite call it that) I'm prepared to use, mostly because it's so loose and informal. I hope it stays that way. I hope the "Hot Political Topics" bar isn't a sign of future feature creep that plagues other sites. (I'm not even in the US, why can't I turn the damn thing off?)
As for whether I'd pay for Twitter: yes, if all the people who use it now continued to use it. Unfortunately, charging for it would almost certainly cause a lot of them to leave, reducing its value - which would lead to a vicious cycle. I think this is the main problem with monetising social networks that aren't targeted directly at who are prepared to pay from the outset.
Freemium is probably the way to go. The trick is finding a sufficient set of value-adding features, ideally introduced immediately as a premium option. Nobody likes to pay for something that used to be free. Of course, if it was easy, they'd already be doing it.
Facebook is what you make of it. I have an account there and largely use it for gaming. Outside of that, I check it a couple times a week. It's been pretty nice for connecting with people (even facilitated our class reunion) but what I like best about it is that I don't really care if I ever check up on it.
I use it, but only because it mails me notifications about events. If my non-technical friends understood mailing lists, and enough of them were on the same one, that would easily beat facebook for it's primary usecase (at least in my situation)
I've put some serious thought to the question "How much is a Facebook account worth?"
Clearly, there must be a free account available because it wouldn't be worth a penny if it didn't have as many users as it did. So I re-framed the question as "What parts of Facebook are worth a premium?" as well as "What parts of Facebook would I pay for?"
Unfortunately, the list is pretty short. I used to use Facebook a lot during college, but now I use it for the occasional info or photo lookup. When I'm bored waiting/traveling/etc, I will usually whip out my iPhone and comment on a bunch of feed items and that's always worth a few laughs. But would I pay for that? I just really can't see myself needing it badly enough.
What "advanced" or "premium" features do all of you use? What would you pay for those features?
Out of curiosity, if it disappeared tomorrow, how much would you pay to get it back?
("Sorry guys, we can't afford it anymore! We need people to chip in $1 each a month or we have to shut down. These friends of yours have already agreed to stick around: XXX, YYY, ZZZZ")
That's an interesting exercise, but in reality I wouldn't expect enough of my friends to pay to stay on. There would be a mass drop in the number of users, significantly devaluing my membership. So if that were to happen, I wouldn't pay anything. However, if they said "We're now at even cash flow, but have amassed a lot of debt! We don't intend to take this towards profitability, but please help us stay afloat." I might donate 10 or 15 bucks. Not that I expect that to happen either :-)
The problem with what the article suggests is that the penalty for not paying is the destruction of the usefulness of the service, that's unacceptable.
People log in to facebook precisely because people do 10 status updates a day, and post an ungodly number of notes, and join a ridiculous number of groups. If you restrict these, even if some people are willing to pay, the network is no longer compelling, and usage will drop, and you send yourself into a death spiral.
Clearly facebook's monetization does not lie in charging for an account, that is IMHO one of the dumbest ideas I've ever heard.
Oh, and the author is completely off his rocker if he thinks you can get 5% of people to subscribe to a pay-facebook. Think 1%, max.
That sounds a lot like classic "Chinese marketing" that a lot of companies first tried when China opened up for foreign business. There are a billion people in China, so all we have to do is sign up 1% of them as paying customers and we'll be rich! Anyone can get 1% market share, right?
Of course it turns out that didn't actually work for most of the companies who tried. There has to be some kind of specific value proposition or you won't get even 1% of any market.
Typically, there are free tools, and premium tools available to those who pay. They could work on some new features, and only release them to premium users. Ideally, the features are only interesting to those that care a lot about their profile. Analytics are a good option.
If they charged people for any custom applications they wanted to put on their profiles, and then gave some of that money to the app developers, I could see both a dramatic decrease in crud, and a dramatic increase in the quality of apps in use (cause, y'know, they're paying for 'em.)
