Seems to be the normal case these days. Companies bring up a device with a cloud service back end. Company realizes that just selling the devices and running the cloud service for free forever isn't as profitable as they want. Company starts charging for the cloud service. I think we hear about this kind of thing every few months...
> running the cloud service for free forever isn't as profitable as they want.
Which is entirely predictable, by anyone thinking of buying a device. If you pay attention to that. Employing people to keep the service running well forever with little to no revenue just isn't sustainable.
Anything you're thinking of buying, if it requires the manufacturer's web site / web service in order to use it, it's going to go offline at some point. If the web service is free, it's probably going to go offline or becom
Such a business model requires new sales each month to cover the monthly costs.*
That means each month they charge new "lifetime" subscribers.
That means costs increase each month.
That means each month they need a greater number of new subscriptions to cover the higher costs.
The business will be losing money and in the process of going out of business as soon as the rate of new subscriptions stops growing. The possible exception to that would be if their costs decrease each month despite having more customers.
* Theoretically they could set aside all subscriber revenue into investments, then use the investment earnings to cover ongoing costs. Nobody does that other than some non-profit organizations.
Seems pretty typical (Score:1)
If it's cloud, that's going to happen (Score:3)
> running the cloud service for free forever isn't as profitable as they want.
Which is entirely predictable, by anyone thinking of buying a device. If you pay attention to that. Employing people to keep the service running well forever with little to no revenue just isn't sustainable.
Anything you're thinking of buying, if it requires the manufacturer's web site / web service in order to use it, it's going to go offline at some point. If the web service is free, it's probably going to go offline or becom
Re: If it's cloud, that's going to happen (Score:2)
What does this statement mean for those âoelifetimeââ(TM)online drive and vpn subscription services that are out there?
Will fail when exponential growth stops (Score:2)
Lwt me be more explicit.
Such a business model requires new sales each month to cover the monthly costs.*
That means each month they charge new "lifetime" subscribers.
That means costs increase each month.
That means each month they need a greater number of new subscriptions to cover the higher costs.
The business will be losing money and in the process of going out of business as soon as the rate of new subscriptions stops growing. The possible exception to that would be if their costs decrease each month despite having more customers.
* Theoretically they could set aside all subscriber revenue into investments, then use the investment earnings to cover ongoing costs. Nobody does that other than some non-profit organizations.