I was listening to the great This Week in Tech PodCast and they came up with a fascinating little story about Yahoo! and Flickr.
Flickr now has 10 million members, all posting photos like crazy. Guess how many orders for prints etc they get every week? 100,000? 10,000? Actually, it’s 80.
To rub salt into the wound, it isn’t a cheap service to run, especially as it hogs bandwidth. For instance, many sites link to Flickr, like I have above. And guess what - it’s their bandwidth that’s being used, not ours.
It would be interesting to know how many $24.95 Pro accounts they have. But it seems overall, it’s a big loss maker.
Clearly, it wasn’t the worst deal of last year - how can you beat eBay’s purchase of Skype? But it doesn’t look like being great value, unless another business model emerges.
I read somewhere that Flickr was profitable before Yahoo acquired it…
If 10% of the users are pro thats £25m revenues p.a. - more than enough to pay for the bandwidth?
James - true enough. 10% is a good guess, but how about 1% or 0.1%? Would be interesting if anyone knew the rough %.
Russell
Definetely I don’t agree.
First of all it’s quite easy to see how many pro accounts are there given the fact that basic accounts allow you to upload no more than 200 photos and to have no more than 2 sets, and in my experience I’ve always ecountered pro accounts. I too have a pro account as I decided to store all my photos on flickr.
Then i think Yahoo’s acquisition was worth beacause acquired all of flickr users as they have to migrate their flickr account to a yahoo one. Now more and more users have a yahoo account and that makes easier for them to try yahoo’s features.
gparker - maybe I wasn’t clear. According to TWIT, it’s Yahoo! themselves who are reportedly unhappy. This isn’t my pet theory for you to agree or disagree with.
Doubtless there are some less obvious synergies and thanks for pointing them out. But allegedly, they don’t outweigh the cost of buying and running it.
Russell
[…] Mobhappy points to an interesting flickr fact, out of the 10 Million flickr users 80 people have ordered prints. So the better question is “but what if no one uses that” […]
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Business Fear Mongering - “But what if everyone uses that”…
by: Karl Long Many conversations about interactive products and services come to the point of asking the question “but what if everyone uses that”, ususally reffering to the “free” aspect of a service, or the general priceing, o…