Social software business models
The popular photo sharing site Flickr.com just announced that they are now offering prints and backup dvd’s through third party suppliers, which is pretty neat. Even cooler is that they made a commercial API (Application Programmer’s Interface) to service these partners which allows them to open negotiations with anyone that thinks they could sell a service to Flickr users. Which in turn allows them to add a licensing model to a ’selling subscriptions’ model, which might make Flickr the first (the first successful example at least) for a new business model in which you create a service that many people people use and then sell the right to sell extra services to your user base through a ‘closed’ API. Although not many services will be able to repeat this feat it is a pretty cool stunt that many failed to achive back in the web 1.0 days. For effect just let me repeat:
You can make money offering stuff on the web for free (or next to nothing).
Th snag is in the ‘closed’ API of course. Flickr flourished in part because the API was open to all and developers around the world built nice applications that extended the functionality of the basic service. With the extra functionality only appearing for paying commercial partners the incentive to build cool stuff for Flickr quickly vanishes. On the other hand, if they manage to keep both unpaid enthousiastic developers and paying customers happy they have created a very successful, and cool, web service indeed.