Everyone has an idea. Most of them are bad ideas, mixed with a few good ideas, and every once and a while a great idea. The problem is, online our ideas often are hard to monetize. Xmarks (formerly Foxmarks) was a great idea, a service I both loved and used, and they will soon be out-of-business because they were unable to monetize their service.
Some people create applications, or websites that act like applications. Their plan to monetize their work and efforts is through advertising, which I believe limits the value, and cleanliness of your website or app. Sometimes there is no monetization plan (which sadly seemed to be the case of Xmarks), and fear of not trying revenue models takes over. I would have gladly handed over $20 or $30 a year, as the service was very valuable to me.
In comes Instapaper and the developer Marco Arment. Marco, while working full-time at Tumblr, writes a web application and iPhone/iPad app that allows you to save webpages that you are currently visiting, to read later in an all text format. The article is then made available on your iPhone, iPad, Web Browser or Kindle. The idea was amazing, and you could pay the five dollars for the iPad full featured application, or you could use the free version and the website free of charge.
Marco recently decided to leave his full-time job to work full-time on Instapaper. The first thing he did was open up a new revenue model (short of). He added the ability to “subscribe” to become a full member for $1 a month (billed quarterly). What did he offer for someone becoming an extra subscriber? Nothing! Admittedly he said on this website that right now, you just get to support Instapaper, and he will add on features for subscribers at a later date.
So with seemly nothing extra to offer, it would seem there wouldn’t be much incentive for people to subscribe. The numbers tell a different story. Thousands of people have been reported to have already signed up and given their money to Marco. I’m very proud to say I am one of them. A service like Instapaper shows so much value to me, that I’m very happy handing over that few dollars. This is the case study that I hope will change the business models of hundreds of website’s and applications online.
The stigma online has always been that everything has to be free. That just isn’t the case! People will pay for good content, good services, good value. I wish Marco the best of luck and I am very excited to see where he is going to take Instapaper in the future.