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Ning Free Rides Coming to an End



In a move that went somewhat under the radar a month ago, Ning’s co-founder and CEO Gina Bianchini was replaced by COO Jason Rosenthal. This signaled the end of the of a few things: at the time, Bianchini’s long time influence on the platform. Then yesterday, the end of Ning’s free offering and the end of many jobs at Ning.

TechCrunch reports

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.

Team,

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.

Thanks,

Jason Rosenthal

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?

  • http://www.marketingpilgrim.com Andy Beal

    This is just another reminder why I try not to rely on 3rd-party platforms for important content. This time, it’s the removal of the free service, next it could be closing. You never know!

  • http://KarlSakas.com/ Karl Sakas

    I can understand the business need to focus on paid sites. But how does firing almost half the staff help the company grow its revenues? And the CEO’s message reminds me of how RadioShack laid-off a bunch of its people via email a few years ago.
    .-= Karl Sakas´s last blog ..Always be testing, and other Email Marketing tips from the Triangle AMA panel =-.

  • http://gauchealchemy.wordpress.com Amy Wing

    I think Ning just royally screwed themselves. It’s a move that will alienate the vast majority of those who ARE driving traffic, and also, they’ve permanently undermined confidence in their brand. Honestly, it’s just not a good way to do business… there are so many other ways they could have addressed the problem, and frankly, when a social network company can’t figure out how to leverage the massive amounts of traffic they’ve got coming to them, that’s concerning. Frankly, Ning probably never deserved the massive following they’ve had – it’s just not that fantastic a platform for the plug-n-play crowd who have become used to a lot better management and more customization options… but far better than the cost and labor involved in setting up your own PHP. If there was nothing better out there, we’d probably just suck it up and go with the new business model. Given that there ARE better (if less popular, to this point) options out there, which remain FREE to the end user – and given how we Ning users now feel royally shafted, I think Ning just nailed their own coffin shut. Personally, I don’t want any involvement with a company that shows so little regard for users, free or not.

  • http://martymcpadden.com Marty McPadden

    You make some good points here. I’m working with a couple of colleagues regarding developing community related online businesses and have steered both of them toward paid services and tools. Free services are fine to use as long as it’s understood “you get what you pay for.”

  • http://www.kingrosales.com King Rosales

    I am actually really disappointed with this news, I started using Ning early last year and was hoping to create a couple more free communities to test some concepts. I agree with you Andy, I am weary about third-party platforms; they have control no matter what. It will be interesting to see how these new moves affect the company.
    .-= King Rosales´s last blog ..3 Ways Canadian Affiliate Marketers Can Make More Money with a Weak US Dollar =-.

  • http://www.zerista.com/ Zack

    Crazy that all these folks are left with the option to pay or leave. I noticed there are some free options out there. Zerista is one that is a free and lets you take your group to your mobile phone.