MySpace & Photobucket - Free services come with strings attached

MySpace has blocked Photobucket  content again. Robert Scoble reminds us when you host your content on free services nasty crap can happen. TechMeme is flooded with blogs angrily protesting MySpace's actions. The lesson is this; Free services always come with strings attached, limitations, service outages, advertising, and rules that can change at any time without notice.

Consumers sometimes forget the bargain they made in exchange for the free services. Sometimes it means your personal information can be sold or marketed. Other times it means your content is not really yours anymore. Sometimes it means you get to pay for additional services once you are hooked. Or maybe that the rules change over time and the service is unreliable. Most times things work out OK and consumers don't complain too much.

Consumers will put up with hassles and uncertainty in exchange for a "free" service. Businesses will not. Business customers require solid, reliable systems and they are willing to pay for them.

Both markets, consumer and business, are important and potentially profitable. However, the economics and expectations are different for consumers. As an example, Microsoft has 260 million Hotmail consumer users and over 500 million Outlook business users. The terms of service and feature sets are different and so are the business models.

MySpace, YouTube, FaceBook, and other Web 2.0 free services get lots of attention. They are held up as examples of innovation and the new way of doing things. I agree they are fun services but innovative? Depends on your perspective.

There is no such thing as a free lunch. It is an old saying, but worth remembering. You get what you pay for is another that comes to mind.

The MySpace vs Photobucket battle is another reminder why businesses are happy to pay money for reliable services and professional support.  This is true in the software business too. Many businesses gladly pay for software, service, and professional support even when free alternatives are available. You get what you pay for....

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Comments

[Steve Morsa]

...and as a nice corollary, Don...you don't get what you don't pay for...

There are times when "free" really is just another nasty 4-letter word.

[Marc]

"You get what you pay for" applies to some free services, but what about Open Source software? I haven't found the catch in FireFox yet. OpenOffice does have bugs (don't trust the spell checker!), but so do a lot of expensive alternatives (I still can't make documents with vertical AND horizontal pages without trouble in Word 2007). So would it be correct to conclude that if the company offering the "free" service somehow makes money, then there's a catch? If not then it must be offered out of goodwill/open source goodness?
I think most people accept that a freebie will often have a catch, or be used to promote a paid-for service.

[Shashank Garg]

I will look at the other side of free service - I think it enables us to access significant information about society and its behaviour, regardless to say businesses also managed to get direct access of their customers i.e. total disintermediation (which means less cost) and that's what web2.0's biggest achievement and makes it stand out from earlier dot com era where we only saw evolution of reintermediation tools like amazon, eBay and etc..( no substantial reduction on cost)
in conclusion, lets wait, I am sure something very favourable for the end consumer will evolve from these tiffs among free players..

[Simon Mohr]

This blog is free to read - does that mean I should doubt its reliability or accuracy?

[CS Zeng]

At the end of the day Myspace isn't about letting people have their own website and form communities. It is about collecting info and selling you stuff or allow other users to sell to you.

If you want to people to take notice, it better be free and have a cool cache to it. I use Myspace, but I don't care for the ads, unless they are about movies I want to see.

If Myspace is having a spat with Photobucket, users do know that there are other image hosting services. At the end of the day, photobucket is small matter in contrast to the evils of sleeze, phishing and spam that exists on Myspace. Perhaps we should be using Myspace's photohosting and image slide widgets...

[Cary]

I wonder how many aspiring young musicians have unknowingly granted distribution rights to their material to YouTube in return for "free" video hosting...

[Danial Jameel]

Hence the Adage "Growth now profits later". Now that these sites have have grown the hidden strings are becomimng mroe visible. MySpace has very little incentive to show photobucket content and this is something PhotoBucket shouldn't be whining about. I wouldn't be surprised that in a not so distant future, Youtube starts charging websites using it's video repository and sharing revenues with the users. It is the next logical thing to do. I'm sure there is going to be a lot of hue and cry over that aswell since quite a number of video sites are youtube dependant.

I'll be posting an interesting article regarding our freebies and open APIs on my blog soon.

Danial Jameel
www.UReporting.com

[Gary]

I use TinyPic.

[Lloyd Budd]

What are these things called consumers you write about? Oh, you mean people. I know a lot of people who don't like being referred to as consumers.

[Don Dodge]

Lloyd,the software market for enterprises is very different from the consumer market. There is a different level of expectations and different costs. Hotmail is for consumers while Outlook is for enterprises. If you have a more descriptive word for consumers great. I don't think anyone would know what I was talking about if I said the "people" market.

Simon, yes this blog is free to you, however I pay money for hosting fees and services for the blog. So, my expectations of TypePad are much higher than for a free service.

As for if you should doubt its reliability or accuracy, that is up to you. In the same vein my guess is that your expectations of accuracy and balance would be far higher for content you pay for at the Wall Street Journal than they are for what you read on this or any other blog.

Marc, Free Open Source Software (FOSS) comes with no warranties, indemnification, or other promises. Some are comfortable with this, others are not. Some businesses use FOSS for some applications and pay money for commercial software for other applications. For example, they might use MySQL for some things and pay for SQL Server for others. Why? My guess is because of risk issues, scalability, and performance, among other things.

[Ty Graham]

What a great story this is! I had a few guesses about which company would be the tipping point for revolt but I never would of be Photobucket from their long history. Myspace is not only screwing with their bread and butter but with the partners who helped spread the word that helped them beat friendster and the like. Think about it: Dialup birthed AOL for social means and yahoo for entertainment means. Broadband birthed Myspace for social means and Youtube for entertainment means.

1 + 1 = 2, that's 2 distinct revolutions, ah ah ah!

My point? There can only be 2 revolutions for connecting people to the Internet -slow or fast. If the internet had a conscience, it would be the collective thoughts of the people who use the internet [popularized for social and entertainment reasons today yielding to perfecting business in future versions of the internet 4.0+, hence the internet is software, perhaps software of the mind but i digress]. The only way to tap into the internet's conscience is through people's content. It's only a matter of months or at the most a year or so before the internet literally becomes self-aware through the minds of people who understand they are the next revolution: The information revolution begins in 2007. Each revolt was more interesting than the previous. This should be no different, startups are the life blood of the internet because all revolutions begin from innovation forced or discovered by chance when seeking something better.

We already have the means to be social. We are already entertained. We seek and contribute content to share entertainment in social communities that claim to be free yet limit our freedoms. Content is King but we forget we control content. Grab your widgets and browsers, we the people are the 3rd revolution. Remember Generation X who came before you...

THIS IS MY SPACE!!!!!

because soon, everyone will be blipd!

[Loan Ranger]

There is such a thing as a 'free lunch' hosting solution, I'm using it and can vouch for its user-friendly easiness. MY OWN SERVER! I downloaded a WAMP from http://www.uniformserver.com/ and installed a Joomla! (http://www.joomla.org/) CMS. All of it open source and 'free of charge' to use. This stuff runs on a salvaged old 6.4G HDD, however it could also run using any USB storage device (e.g. stick, or external HDD), but I recommend that it be greater than 4G. So now i've got a working Apache Server with SQL, php MyAdmin. The only catch is that this is only good for 'always connected internet' (e.g. cable) and I have to run my PC 24/7.

[Moofburger]

"Marc, Free Open Source Software (FOSS) comes with no warranties, indemnification, or other promises" - Ha Ha perhaps you should take a look at a Microsoft EULA sometime Don.

[Yan]

Even to answer to this log is not free...
You've to give your emal, they then sell the email.
The internet is a complex mercantile system.

[Clyde Smith]

"There is such a thing as a 'free lunch' hosting solution, I'm using it and can vouch for its user-friendly easiness. MY OWN SERVER!"

You left your labor out of the equation. And there's this little thing called electricity but that's just splitting hairs.

"You get what you pay for...."

I so wish that were true. While I do mistrust free services I've been severely screwed by many that charge me for their "valuable" products and time. And so has everyone else.

On the business/consumer split, I'm like a growing number of small web publishers that cross the line and are generally ill served by consumer services that are weak and by enterprise services that are overengineered and too expensive.

It actually amazes me how many consumer apps (or features in some Web 2.0 cases) could be used by [very] small businesses if someone would roll them up and offer solid, consistent service.

I'm not holding my breath on that one.

[Sumedh]

So do you want to say that use Microsoft instead of free services?

[racer]

I hate it when people/web site start to fight. Us normal people spend our time etc. yes and it's free but still. why stay when you have legal fights going on.

[Lloyd Budd]

I like the terms "consumer customers" or "consumer markets", but for me it is not the same as the label "consumer". It is a mind set, talking about people as opposed to with people.

Your post is correct, there is no free lunch. There is always a cost -- to someone.

Ever supported customers trying to use Windows XP? And you are are talking about quality of service?

Have you read the Windows XP EULA? You talking about warranties?

You are pulling the same FUD about open source that contributes to Microsoft's fame.

If you, Microsoft, are interested in substantiating your claims many people are waiting, otherwise stuff it.

Do you know much about databases? Why throw that in? I worked from 2000 to 2004 exclusively in enterprise databases, and SQL Servers was never part of the conversation with any of my customers when talking about risk issues, scalability, or performance. Maybe things have changed, but I would be surprised.

This blog has become more about Microsoft sales pitches, and the bashing of your competition. It has become much less fun to read and I am doing a lot less learning.