Posted by Mitch Mitchell on Apr 20, 2010
Ning is a social media site where people can create groups and invite people in to talk about tons of different topics. Of course, just because something seems like a good idea doesn’t mean it will work, and I wrote about my disappointment in Ning back in January after being a part of it for what I consider a long time.
This weekend is was announced that Ning will no longer be free, at least for people who create groups, and probably for people who still want to participate with them. I say “probably” because Ning hasn’t announced yet how they’re going to do things. What they did say is that 75% of their users are already paying for the service in some fashion, so they’re just consolidating the other 25%.
Based on comments I’ve seen on both their blog and other forums, that 75% figure seems to be a great exaggeration. Not only that, but they’re announcing these changes at the same time that they’re cutting staff. All of this comes with the new CEO of Ning, Jason Rosenthal, and was pretty much outed by an employee through a letter Rosenthal sent to all of them. Seems they don’t much like it either, obviously. I read a copy of the letter on the Ning site Property Tribes, but since I’m expecting it to not be there all that much longer, since this guy is a VP of the company and, by posting the letter could have potentially messed up his employment there, here’s a copy of the letter, which is all over the place by now:
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.
Doesn’t sound good to me. I can’t even say “good riddance”, since I cared little for it anyway. Your thoughts?