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Comment by almatabata | Hacker News Reader

You cannot have both a gigantic user base and a paid product. If you charge for your product you will always have people who do not value your product at the price you need to charge.

If you make it free you will always get more people to use your products. This helps a lot in getting funding in case of startups. Look at our user base if each user paid 1 dollar we would make billions. Of course you can never turn 100% of your user base into a paying customer.

If you want to keep your massive user base you have to resort to ads. If you switch to a paid plan your user numbers will decline and investors will complain. If you do not show ads you will continue to bleed money and make no return on investment.

At some point in time having a small paying customer base became unsexy to a lot of investors who wanted to chase after the next potential unicorn.

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> You cannot have both a gigantic user base and a paid product.

That really depends on how we define "gigantic user base", but I think Adobe, Valve, and Autodesk all disprove it.

> If you charge for your product you will always have people who do not value your product at the price you need to charge.

It doesn't matter how many non-customers you get, only how many customers you get.

In general, I think you do have something of a point in that it is easier to get more users with a nominal price of $0, and it might be a way to get enough users that the small $/user from ads works out. That doesn't mean that ads are always going to work or that other models can't work, though.

> You cannot have both a gigantic user base and a paid product

The obvious counter example to this is Windows itself. Or... iOS?

Users pay indirectly for those, they don't see it as a standalone paid product.

Both of these get bundled with the Hardware so people do not really consciously chose them.

And for windows it seems the microsoft actually started to go the ads route by putting them in windows 10 and 11. And you do not have to pay for the OS anymore to use it as you do not have to activate the license.

>The obvious counter example to this is Windows itself. Or... iOS?

Or hardware, even. Just look at the iPhone...

Even hardware can become victim to this look at Alexa:

https://arstechnica.com/gadgets/2022/11/amazon-alexa-is-a-co... https://www.dallasnews.com/business/technology/2023/08/20/ji...

One example surrounded by many other pieces of hardware that don't do this doesn't do much to solidify your "cannot" absolute.

Edit: Your second link makes it pretty clear that it's not Alexa's lack of profitability that seems to be the issue with regards to ads playing between songs. Apple Music has a free, ad-supported tier - meaning that on whatever device you use it on, you'll hear ads. If your Alexa is set to access your ad-supported Apple Music account, then of course you're going to hear ads.

Or coca-cola, or baby formula, or the myriad of construciton materials that we all consume but are produced by a few obscure, giant entities.

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