Where I’m Coming From
I’ve been a long time PRO level subscriber as well as supporter of SmugMug. They are easy to use, have a great display, allows for unlimited uploads, and generally have a great support team that responds quickly.
I subscribed to the PRO level, now referred to as Business level, when it was $99.95. I did multi-year subscriptions to lock in my rate and for the last several years, I’ve been at that level. For what I was getting, it was a great deal, even though I’ve never been able to figure out, how they managed to make money, given the unlimited storage model they were working with. I had assumed they either made enough through commissions on sales or the bulk of their users were heavily under-utilizing the service.
Just before the recent Labor day weekend, I got an email from SmugMug indicating that effective mid-October, there would be a price bump for all Pro level subscribers of $100. So $99.95 subscribers get bumped up to the $200 mark and those at the $159.99 get bumped to the $25x level, etc. New subscribers get the $300 price tag.
For me, this would be a doubling of overhead for what is effectively an already expensive hobby. With cost of living going up, our household has been making cuts where we can. My hobbies and the subscription services tied to that hobby are no exception. The amortized monthly amount would effectively be going from $8.33 to around $16.66, so not a big monetary bump. But still, a bump.
Then, there is the question of business model. In SmugMug’s reply to the public and to their subscribers, the need for the price bump was to counter increased storage usage by PRO and BUSINESS users. The subscription price will go up, but nothing else will materially change. Those who don’t like the higher price can downgrade to the new PORTFOLIO account, which is $159.95/year. This really isn’t an option for those who still want to make monies off of their sales, as you lose the ability to set prices and make a profit from sales.
SmugMug did address the storage utilization issue and noted that mid-range PRO/BUSINESS users used at least 4X that of the lower tiers, and the heavy PRO/BUSINESS users used 4X of the mid-range PRO/BUSINESS users.
Instead of bringing in a tiered model, which would tie their storage utilization to a revenue stream, they decided on a fixed price bump. This potentially addresses the issue in a couple of ways:
- Some users will leave, taking their storage footprint with them.
- Users will pay more for their account, but might not increase their footprint, resulting in more net income.
However, here is the gotcha:
- If users realize they aren’t getting anything from sales anyways, they might just downgrade to the $40/year account, leaving their large data footprint on the SmugMug servers.
- The responses from SmugMug and the responses from end users might indicate that people may now make heavier use of the “unlimited” aspect of their SmugMug account.
What is the Cost of 1GB?
From what I can see from public posts and announcements, SmugMug’s storage capacity is handled by a combination of in-house storage systems and 3rd party back-ends like Amazon S3 cloud storage. Can’t speak to their in-house prices, but publicly available pricing via AWS S3 is around $0.15/GB, depending on region and durability. Inbound traffic to the AWS S3 is free, but outbound is billable.
My storage footprint at SmugMug is around 24GB, according to their metrics. That puts me at around $3.60/month, or $43.20/year. This is suspiciously close to the $40/year annual bottom tier subscription model with SmugMug, which still offers unlimited storage, but no customizable themes, domains, or custom pricing. Ie, they are front-ending your gallery.
Depending on the end-user’s equipment, 24GB is either ALOT of photos or it is only a moderate number of photos. For me, it represents around 2000 photos or around 12MB per image. I’ve got fairly large original JPEG(s) uploaded with the intention of printing them with the best detail possible. However, most will compress their images to under 2MB apiece. In which case, 24GB represents 12,000 images.
A PRO/BUSINESS user downgrading to an entry level account would still be able to upload as many images as they desired, just minus other niceties. If they have a front-end blog/gallery somewhere else, and are just using the SmugMug service to host images, then this can represent a problem for SmugMug. They effectively become a REALLY cheap unlimited image hosting service. Probably not a good spot to be in.
Where I’m Going
I’m not confident that SmugMug isn’t going to need to bump their prices again in the future. The price bump prompted my own re-evaluation of how I use their service, what features I use and what features I don’t use. My pain points and how a change can provide improvements to my own usage of my images.
I currently host my own blog website, this blog website, on my own virtual server. I _could_ host my images here, as that would incur a total of $0 additional cost to do so. This would also be the simplest means of hosting my images. However, the amount of storage space available to me is limited, and there are other considerations for that space usage: logs, temp files, other batch jobs running, etc.
So, looking to Amazon S3 storage hosting, I would incur a charge of around $3.60/month. However, that is only the case if I decide to store my original image files on Amazon S3. Since I’ll most likely no longer be printing the images, I no longer need to keep 12MB/image files and can bring that per image footprint down to around 2-4MB apiece. Or $0.60 – $1.20 / month to host my images. I would still be able to partner with 3rd party printing services like Fotomoto or BayPhoto using their ROES applications to do print orders.
Amazon S3 also has an interesting option, where you can associate a fully qualified hostname like say… gallery.wingtangwong.com to an S3 bucket. Replicating the folder structure of the images, file names, etc. would allow me to provide backwards-compatibility with already published URL links. No additional charge for this configuration.
Features like gallery passwords, gallery displays, and RSS/ATOM news feeds would need to be implemented with some coding either in WordPress or another mini server application. (TBD).
I have until mid-2013 to decide what to do, but in the meantime, I’m building out my plan B with the intention of migrating off of SmugMug. I would like to see SmugMug continue to grow, but they have made their business decision and it is pretty clear. In order to make their business model work, they will be focusing on photographers and subscribers who are actively marketing and promoting print sales through their site.
I’m not part of that demographic, and I don’t take it personally. Landscapes change and situations change. This is a change, and I’m changing my strategy and processes.
This has also prompted me to re-evaluate my photography in general.