First, let's look at the official press release.
Let's look at the numbers:
16 million accounts.
Let's say that 10% are paid.
1,600,000 * $35 = $56,000,000
Yes, really.
Let's say, conservatively, that six million are plus accounts, and generate $5 of revenue per year.
6,000,000 * $5 = $30,000,000
Projected annual revenue, then, even at half of the numbers I've mentioned, is in the $40 million range.
And that doesn't even begin to get into things like the agreement with The Independent in the UK, or the sponsored accounts in Russia.
Let's look at recent history:
Server moves that are completed in as short a time as the recent move of Livejournal is not done by picking up servers and physically moving them, especially considering the distances involved. If SUP were smart, they would have gone for a highly managed solution that reduces the need for sysadmin staff. Yes, it's called outsourcing, and yes, it works out cheaper.
The Permanent account sale was extended for maximum effect, especially considering the time of year, and economic climate. I would assume that a few thousand at least were sold. ten thousand permanent accounts = $1,500,000.
Let's look at business practices:
No company will keep paying staff they no longer require. No company will make payments in this financial climate that they are not contractually bound to make. No company that can afford cheaper staff in another country will pay through the nose for foreign workers. My condolences to those who lost their jobs, but this is capitalism.
Finally, a synopsis:
Valleywag, according to the comments in the blog entry that sparked all of this, is not a fan of Livejournal. The numbers quoted have been fabricated. More believable numbers are:
The true numbers ... are more like 13 let go, 17 kept in total, and 12 let go and 12 kept in SF. Always be skeptical of Valleywag.
Of course, if this storm in a teacup prompts people to leave Livejournal based on a perceived threat, then yes, our beloved LJ may be lost, but it won't be SUP's fault. It'll be the userbase's own fault.
So, don't panic, and don't let one tiny, obscure article get in the way of common sense.
Let's look at the numbers:
16 million accounts.
Let's say that 10% are paid.
1,600,000 * $35 = $56,000,000
Yes, really.
Let's say, conservatively, that six million are plus accounts, and generate $5 of revenue per year.
6,000,000 * $5 = $30,000,000
Projected annual revenue, then, even at half of the numbers I've mentioned, is in the $40 million range.
And that doesn't even begin to get into things like the agreement with The Independent in the UK, or the sponsored accounts in Russia.
Let's look at recent history:
Server moves that are completed in as short a time as the recent move of Livejournal is not done by picking up servers and physically moving them, especially considering the distances involved. If SUP were smart, they would have gone for a highly managed solution that reduces the need for sysadmin staff. Yes, it's called outsourcing, and yes, it works out cheaper.
The Permanent account sale was extended for maximum effect, especially considering the time of year, and economic climate. I would assume that a few thousand at least were sold. ten thousand permanent accounts = $1,500,000.
Let's look at business practices:
No company will keep paying staff they no longer require. No company will make payments in this financial climate that they are not contractually bound to make. No company that can afford cheaper staff in another country will pay through the nose for foreign workers. My condolences to those who lost their jobs, but this is capitalism.
Finally, a synopsis:
Valleywag, according to the comments in the blog entry that sparked all of this, is not a fan of Livejournal. The numbers quoted have been fabricated. More believable numbers are:
The true numbers ... are more like 13 let go, 17 kept in total, and 12 let go and 12 kept in SF. Always be skeptical of Valleywag.
Of course, if this storm in a teacup prompts people to leave Livejournal based on a perceived threat, then yes, our beloved LJ may be lost, but it won't be SUP's fault. It'll be the userbase's own fault.
So, don't panic, and don't let one tiny, obscure article get in the way of common sense.
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