[FM Discuss] berlin pricing

[adam hyde]

hey

I think this discussion about 'real costs' is a little confusing. What
is the real cost of creating wikipedia? What is the real cost of
creating fm as it exits now? what is the real cost of linux?

We are not talking about real costs, we are talking about sustainable
models. I really don't understand where 'real costs' comes into it at
all. 

The current model of selling books is not creating revenue for new book
sprints or covering any other costs. Pricing books at the same price as
Peach Pit or O'Reilly does will not help - this market is tanking and
the industry itself is asking itself what kind of models could work as
the current ones do not. Book sales as a revenue model is not the
answer. OReilly, for example, is becoming a conference business and is
downscaling staff dramatically. This should tell us something -
specifically it tells us the old model is broken.

We need another model, and certainly the traditional
publishing-distribution-sales model is not it. 

adam



On Sun, 2009-07-05 at 09:44 -0700, chris hofmann wrote:
> A few more ideas.
> 
> FM is probably going to have to try tons of funding models before 
> finding a few successful ones that stick.   
> 
> Once you figure out your core values, try as many experiments as 
> possible that fit inside those core values.
> 
> The Berlin model is interesting but I think that one part that is 
> missing from the consumer side is good information about what the real 
> costs might be.  The consumer can't make a real informed decision about 
> what it might take to keep the operation sustainable.  One experiment 
> might not be the 'blind 2 euro model', but rather a 'transparency into 
> our cost model'
> 
> For each manual provide something like the following:
> 
>     -here is the link that describes our values, our community of
>     passonate contributors, and our beliefs in transparency and
>     providing user value. [something like the brand stuff I wrote in the
>     last thread],
> 
>     -here is the minimum you must pay to get a book (2 euro?  -- I'd say
>     more)
> 
>     -here is an estimate of what this book might have cost to produce
>     given the level of time and effort put in by all contributors
>     (optional price)
> 
>     -here is the amount that keeps us operating (optional price)
> 
>     -here is a suggested amount that allow us to invest in more projects
>     and infrastructure (optional price)  [ and a link that talks about
>     upcoming projects and infrastructure that you would be helping to fund]
> 
> 
> I think if you combined these ideas you get the best of  ideas that 
> Derek and Adam wrote about.
> 
> Adam -
> --Make people feel good about what they are contributing too, 
> 
> --Create some buzz  and attention around a new way of thinking about the 
> worlds of publishing, pricing, transparency and value.
> 
> Derek -
> --Know your costs,
> --Try to understand the value you are providing
> --Run the operation efficiently and effectively,
> --Plan for sustainability.
> 
> 
> The interesting thing about trying to track these costs and levels of 
> value is that they could also be applied to the on-line materials.   You 
> could also make it possible for users to feel good about contributing to 
> those works by pledging contributions for viewing or downloading.
> 
> -chofmann
> 
> Derek Holzer wrote:
> > Hi Adam,
> >
> > I'm on the road right now, so this will have to necessarily be much 
> > shorter than your original question.
> >
> > First of all, let me qualify this all by saying to the list that I am 
> > not a daytime-professional who works on Free Software related projects 
> > in the free time which an office job income can support. It's not my 
> > "hobby". I am a freelance artist who writes and teaches for my living. 
> > As I suspect many others here are as well.
> >
> > So I am curious what your idea of "profit" is. It seems you are quite 
> > nervous about charging what these manuals actually are worth in terms 
> > of what it takes to produce them, and that this nervousness about 
> > money could be ideological rather than practical.
> >
> > I'm not of the mindset that Free Software means that nobody gets paid. 
> > That is a recipe for lazy production and poor content (as well as poor 
> > content-producers!). In my mind, non-profit doesn't mean anti-money, 
> > whereas anti-money comes very close to meaning completely 
> > unsustainable in the long run. So how can this thing stand on it's own 
> > two feet without constantly looking for subsidies and other structural 
> > handouts?
> >
> > To me, the idea of "for profit" is about this capitalist idea of using 
> > money to make more money rather than using money to make more goods or 
> > content. So the idea of paying people for their time is not 
> > antithetical to the idea of being "non profit". How many "non profit" 
> > organizations do you know where all the employees actually are 
> > volunteers?
> >
> > If I were you (but of course I'm not), I would take a hard look at the 
> > costs and the costs of people's time involved in producing and 
> > maintaining these manuals and price them accordingly. Pricing them at 
> > "fire sale" prices isn't necessary to move the content. People can 
> > still browse, print etc for free.
> >
> > I think a clear indication of what each manual *should* cost would 
> > encourage people to take them, and the idea of buying one, seriously. 
> > An open donation scheme, on the other hand, might encourage "feel 
> > good" spending but without any scale to measure the value of the 
> > donation against, and doesn't make nearly as strong a statement in 
> > this age of throwaway downloadable content.
> >
> > By the way, the "Berlin" pricing scale may appear to work for these 
> > little cafes, but that is debatable when the staff's time, space 
> > rental and food costs all get calculated...and I guarantee that when 
> > there is a loss it is on the staff's side first. And try feeling good 
> > about it when you've worked all week on a performance and get handed 
> > the EUR 20 of the door money that is your share after the GEMA and the 
> > other people on the bill all get their shares. I find myself saying 
> > the following on a weekly basis these days: "You can die of exposure."
> >
> > My 2-øre,
> > D.
> >
> > adam hyde wrote:
> >> hi,
> >>
> >> following on from the "release early, release often, release
> >> everywhere" chat and the interesting posts that followed (esp. thanks
> >> to chris for interesting deconstruction of the fm 'brand') -  I 
> >> wanted to
> >> follow up with a question about the pricing of books
> >>
> >> At present we have 10 books available.
> >> We put a mark-up on our books of 2 euro for each. The theory on sales
> >> is :
> >> 1. we should sell enough of any one book so that the $ could be used to
> >> fund a book sprint on that topic to update the book
> >> 2. we should sell all material at as low a price as possible to try and
> >> get the content out there
> >>
> >> However, no one of our books has yet enough $ to fund a sprint. Also, I
> >> am not sure about the tone of this policy so I think we need to rethink
> >> the strategy a little. Which brings me to the interesting question of
> >> 'Berlin Pricing'.
> >>
> >> In Berlin there are a number of restaurants and bars that offer a very
> >> interesting model. I attended one yesterday in Prenzlauerberg where
> >> entrance was 1 euro, and then you could drink and eat as much as you
> >> want. When you left you paid what you thought was a fair price. A friend
> >> and I had 4 small glasses of wine each and paid 20 euro. That is about
> >> the normal cost for a small glass of cheap wine in Berlin.
> >> When I paid the 20 I felt good (it might have also been the wine ;) I
> >> didnt feel like I was paying a bill (I could have walked away without
> >> paying anything), I felt I was contributing to something that I
> >> personally supported. I was not obliged to pay, but I did and I felt
> >> better for it.
> >>
> >> There are some that would have paid more, and some that would have paid
> >> less, and some that would have paid nothing. There are also those that
> >> pay a little, and when they come back next time with more money then
> >> they are more generous.
> >>
> >> The interesting thing apart from the feel good factor (which is very
> >> interesting) is that the model seems to be working. At least anecdotal
> >> evidence shows that the bar is extremely popular with people spilling
> >> out onto the street, and also the bar has been popular and has remained
> >> in business for 5 years now.
> >>
> >> Also, 'everyone' knows about the bar because of this pricing model. It
> >> seemed to me that there were also a lot of tourists there which
> >> suggestions word about the bar has spread wider than the local market.
> >>
> >> So...I am wondering about our arbitrary 2 euro policy. 2 euro is a
> >> number i picked out of the air, but I have been conflicted about it
> >> almost since we have been selling books.
> >> It occurs to me that a much stronger model might be to sell all our
> >> books strictly at cost price (ie. at the same price lulu charges to
> >> make them) and offer a model like these Berlin bars. Lulu.com offers
> >> the possibility of uploading and selling PDF. So we could, for example,
> >> offer pdf certificates through lulu.com for the price of 1, 10 and 100
> >> euro.
> >>
> >> Then when someone buys a book they may also decide to support us with a
> >> 10 euro certificate. Or they may not. They might also decide to buy 10 x
> >> 100 euro certificates, or they may not.
> >> They might also just buy x number of books at cost for their school, or
> >> they might buy no books and buy 5 x 10 euro certificates because they
> >> like what we do. etc.
> >>
> >> I think this model has an interesting philosophy at its core :
> >> 1. it puts trust in our audience to support us when they can
> >> 2. it does not require anyone to spend anything other than the
> >> bare minimum on our content unless they really can
> >>
> >> It seems to me this far better realises our original objective with our
> >> books than the 2 euro model.
> >>
> >> I think that this model is a very good way to build good will in our
> >> readership. It is a way to build trust and show that we are about what
> >> we say we are about : developing and distributing high quality
> >> documentation about how to use free software. That is, we are not about
> >> selling books for a profit.
> >>
> >> Also, by moving the generation of income from profits of book sales to
> >> the certificates, we are actually generating income as a result of the
> >> good will we can generate in our audience. This seems a more
> >> interesting motivation to me - in order to enhance income we have to
> >> enhance the size and depth of the readerships good will.
> >> Thats not a bad idea and keeps us focused on our core ideology and 
> >> removes
> >> the focus from non-core activities ie. making a profit from selling
> >> books
> >>
> >> There is another component to the model which is interesting. I think
> >> in this model all sales of certificates would necessarily be put into a
> >> pool of funds available for funding Book Sprints on any topic. This
> >> seems to me to sit better within the idea of a community like FLOSS
> >> Manuals (as opposed to individualism created when income from a book
> >> gets spent only on a book sprint on that content). It also means that
> >> we could put funds towards book sprints on topics that might not
> >> otherwise attract funding.
> >>
> >> Lastly, I think that this model would attract a lot of attention as it's
> >> quite unique. Attention is also not such a bad thing, as any attention
> >> draws more eyes to the content we develop, and also possibly more
> >> participation in developing the content.
> >>
> >> I'd be interested in any thoughts on this...
> >>
> >> adam
> >>
> >>
> >>
> >>
> >>
> >>
> >>
> >>
> >
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Adam Hyde
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Email : adam at flossmanuals.net
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