Lots of New Things to Explore, At Least!

Moving means there are lots of new things to explore.

Special thanks to Ryuutsuki from Help_Japan!

The $15000+ Permaban

Our hopes and support are with Japan, of course.

Salon.com has a pretty good collection of ways to donate, and it’s a good idea to stick with reputable charities. Scams crop up after every disaster, and some of them, like United Way, just stick around forever. For some reason this is not common knowledge, but United Way has a pretty horrible history of corruption, greed and questionable competence. United Way just takes a percentage off the top before distributing funds to its member charities; they add exactly nothing but overhead (and occasional corruption) to the equation. Cut out the middleman.

Personally, I really love seeing the different grassroots funding drives. For example, Dreamwidth and LiveJournal have various fan-related Help Japan communities, where people are auctioning off their talents and services (the dreamwidth community is open until Sunday and Livejournal’s is open until the 26th), and YaoiCon has their own auction of goodies, open until the 20th as well.

My favorite, though, comes from SomethingAwful. Someone made an idiot of himself, and after he failed his chance to redeem himself, one of the Goons decided that he had to donate $10 to the Red Cross or be banned (temporarily) from the board as punishment. After a little discussion, another Goon pledged another $10 if the rulebreaker had to choose between matching the donation or being banned forever. Wonderfully horrible people that they are, the Goons dogpiled onto this idea, kicking off a massive fundraiser for Japan. The poor guy now has to match all of the donations or be banned forever. If he does match, he gets all the perks and upgrades the forums have to offer, and major kudos.

So far the Goons have raised over $15000.

I think he’s getting banned.

Moo Harder!

LiveJournal entertains me, and not only because so many of users throw fits of hysteria at the drop of a hat. For a very long time, it survived entirely on selling subscriptions to about 5% of its users, upgrading their accounts for extra avatars, picture upload space, and a few spiffy (if rarely-used) extra features. Every so often, it sells permanent upgrades, typically for $150.

This five percent is, by definition, LiveJournal’s most profitable five percent of users. Out of these five percent, permanent accounts are, I suspect, the best deal… for LiveJournal’s coffers. $150 buys five years of upgraded service, not counting the interest earned by not paying up-front. I suspect that a Permanent account actually stays profitable more or less forever – on a commercial scale, a gigabyte of bandwidth costs about fifteen cents, a gigabyte of storage about the same – but they get less so if they’re active for more than five years. For comparison, LiveJournal has only existed at all for nine years this March, and as a paid service for eight this September.

Unfortunately, once a user buys a permanent upgrade, that user immediately and forever-after becomes deadweight to the company, an expense that has no hope of bringing in future revenue. Let me repeat that – permanent account holders are not LiveJournal’s customers. LiveJournal has precious little incentive to care what they think. Customers write checks. Once LiveJournal cashes the user’s check, a permament account is a liability, pure and simple.

In 2006, though, they found a way around this problem, which recently became the default for new users: the ad-supported upgrade. I think this was a brilliant decision, in this twirling-moustache, corporate-Machiavelli kind of way. The advertising program means that permament and basic accounts, which ordinarily generate no revenue, are still financially valuable – LiveJournalers (LiveJournalists?) maintain extensive lists of interests and associations in their profiles. This giant database can be mined, and the interests and demographic information mined to target advertising to their friends.

I suspect that people willing to pay $20/year or more for LiveJournal are probably pretty good at keeping their profiles up-to-date, people willing to pay $150 up-front even more so. That’s good, and very important in this business model. Targetting is money in advertising-land.

I have a point in this long and rather unwieldy setup, a reason for this little Gedankenexercise.