This is kind of old news by now, as it was in early April that WordPress.com announced it was changing up the plan options, and it was in late May that they added the Starter plan option. However, it came up for me this week as my friend Andy of Eden in Babylon decided to step away from blogging because there wasn’t an affordable way to get rid of ads. Huw also wrote about this issue a few days ago. In this post, I’ll look at why I think this was a bad business decision on WP’s part.
I get that WP decided it was time to increase prices. Of course people paying for services aren’t going to like it, but it’s the way of the world that prices go up (although for people like me who were on the Business plan and could now downgrade to the Pro plan, there was actually a substantial cost savings). I doubt that WordPress.com is generating enough revenue from ads to fully cover the cost of hosting so many free blogs, so I suspect they might be taking a bit of a loss on free sites in order to draw in more people who will become paying customers. However, I think these recent changes will actually reduce the number of people who will become paying customers, which is why I think WP.com is shooting themselves in the foot.
In a post on the WordPress.com blog on April 4/22, they announced that they’d just be offering two plans for new people signing up: the free plan and the pro plan for 15 USD per month. There probably aren’t many hobby bloggers who are willing to pay $15/month, and in setting that as a minimum price point, they were making themselves inaccessible to all of the people who would be willing to pay something, but not that much. There was a lot of negative feedback left in the comments on that blog post.
On May 25, they announced that they were adding a Starter plan for 5 USD per month. It seems like they came up with it as a knee-jerk reaction to the negative feedback on Pro being the only non-free option. According to the WordPress.com pricing page, the Starter plan includes your own domain name, 6GB of storage, the ability to collect payments, and the ability to integrate with Google Analytics. They said that they would be coming out with à la carte add-on options, but they haven’t announced what those will be or when that might happen. One crucial bit is that the Starter plan doesn’t remove ads from your site.
i highly doubt that many people are willing to pay for a blog that has advertising on it (unless they have control over that advertising and can generate income from it). The idea of paying for an online service to get rid of ads is something that’s familiar to people; paying to still get ads is not. I suspect that WP.com won’t get many people signing up for the Starter plan, and most of the people who sign up will do so without realizing that ads won’t be removed. If you’re not already on a legacy Personal or Premium plan, the only way to get rid of ads on a WordPress.com site now is to pay $15 per month for the Pro plan. For people who don’t need any other Pro plan features, paying $15 per month just to remove ads is ridiculous.
This is bad for bloggers, but from a business perspective, it seems like this change will probably decrease the revenue that WP.com is bringing in. A big chunk of those people who would have been willing to spend $5 a month are probably going to choose not to if it means not getting rid of ads. Those people might stick with a free blog, or if they’re really anti-ad, they’re faced with going self-hosted or switching to a platform like Blogger. None of that is good for WordPress.com’s business.
I do think WP.com will realize at some point that people just aren’t signing up for the Starter plan, and they’ll rejig it somehow. Hopefully they’ll also realize that if they were to kick people off their current legacy plans at some point, that would end up cutting their revenue. It surprises me, though, that they haven’t thought this through better, because it really does seem abundantly clear that this is not a good financial decision for them.
What do you think of WordPress’s decision not to offer a reasonably-priced way to remove ads from blogs?
Since I initially published this, I discovered that there is a way to go ad-free without signing up for a plan. WordPress talks about it on this support page, although I’m not sure why they’re not shouting this from the rooftops. People who are on the free plan or the Starter plan can buy the “No Ads add-on”.
You can find this by going to My Sites > Tools > Marketing Tools. The Canadian price is CAD 36 per year, so the US price is probably about USD 30 per year.
The people spoke, and WordPress listened. On July 21, they announced on their blog that they’re going back to the old plan structure.