It was an article of faith a few years ago that websites were going to somewhat achieve high levels of trust if they ditched ads and would make their money back from subscriptions. This obviously didn't happen. Surely running an ad-free premium service plus discreet ads (carefully chosen advertisers) would be better.
To be fair, they probably needed a big ad-sales team to achieve those historical revenues (the $3M/quarter level) so maybe it didn't look as clear-cut back then. They weren't making a profit in that configuration either.
I think the problem with this business is that people are going to age out of the main 'sending tons of pics of your kids' phase of life, so the churn is going to make it hard to keep the user base growing.
TNY Price at posting:
14.0¢ Sentiment: Hold Disclosure: Not Held
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