One month after long-time Ning CEO Gina Bianchini was replaced by COO Jason Rosenthal , the company is making some major changes: It has just announced that it is killing off its free product, forcing existing free networks to either make the change to premium accounts or migrate their networks elsewhere. Rosenthal has also just announced that the company has cut nearly 70 people — over 40% of its staff.
I have started my own Ning network on the free side so this news is not the best. I was getting ready to pay to have the ads removed from the network but not quite yet. I already pay to have my own domain used for the community. My concern is what will the fees be moving forward? Also, no one ever likes to get used to a certain way of doing things then have the rug yanked out from underneath them in one fell swoop. So until the fees are made known and a decision needs to be made there isn’t much to do. The company has said through its Creators network that the changes will be known in the next two weeks.
To get the full scope of what Ning is doing here is the e-mail that was sent to the staff. On a side note, I wonder if these e-mails are written as more of a press release than an actual sentiment since it seems that they will not stay inside the corporate fence for very long. Here’s Ning’s version of the “Things Are Gonna Change But It’s Gonna Be Good” e-mail from CEO Jason Rosenthal.
When I became CEO 30 days ago, I told you I would take a hard look at our business. This process has brought real clarity to what’s working, what’s not, and what we need to do now to make Ning a big success.
My main conclusion is that we need to double down on our premium services business. Our Premium Ning Networks like Friends or Enemies, Linkin Park, Shred or Die, Pickens Plan, and tens of thousands of others both drive 75% of our monthly US traffic, and those Network Creators need and will pay for many more services and features from us.
So, we are going to change our strategy to devote 100% of our resources to building the winning product to capture this big opportunity. We will phase out our free service. Existing free networks will have the opportunity to either convert to paying for premium services, or transition off of Ning. We will judge ourselves by our ability to enable and power Premium Ning Networks at huge scale. And all of our product development capability will be devoted to making paying Network Creators extremely happy.
As a consequence of this change, I have also made the very tough decision to reduce the size of our team from 167 people to 98 people. As hard as this is to do, I am confident that this is the right decision for our company, our business, and our customers. Marc and I will work diligently with everyone affected by this to help them find great opportunities at other companies.
I’ve never seen a more talented and devoted team, and it has been my privilege to get to know and work with each and every one of you over the last 18 months.
We’ll use today to say goodbye to our friends and teammates who will be leaving the company. Tomorrow, I will take you through, in detail, our plans for the next three months and our new focus.
So it’s probably not a good day to be one of the Ning little guys that is not really driving much traffic is it? It’s a bad day to have a good idea that can bring specific groups together and enjoy many of the functions that small groups couldn’t have in the past. The days of free are looking like the days of the past for many things in the online space.
Your take on this move?