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Peer 1, a right decision?

What kind of business model is this? If you're in the co-locating business, why would you co-locate as a favor?

If I'm in any kind of business other than consulting, I will reccomend a friend how to buy a great computer. If I sell computers, I don't mind telling a friend how to save on gasoline, but when it's about my proffession, I'll have to charge him.

You might have a few hobbies, but the one hobby that is your "proffession", charge $$$ for it!

So, why giving free co-locating when that's you business line?

Or, am I not right?

Bob Schwartz
Monday, February 10, 2003

Oh yes, I'm talking about Peer1's decision, not about Joel's decision to grab the bag of goodies...

Bob Schwartz
Monday, February 10, 2003

If you made a movie, would you charge members of the Academy to see it? Or would you give them complementary tickets?

Joel Spolsky
Monday, February 10, 2003

It could make sense for Peer 1 to comp service to Joel since they probabloy got enough value from Joel's write-up. But when I was reading Joel's write-up, I had a hard time getting past the point where he noted that he was getting free service. I think that he's getting free and it seems better service than the average customer clouds the issue a bit.

pb
Monday, February 10, 2003

I've heard only the best of things about Peer 1, so I don't think Joel's necessarily getting better-than-average service.  We're going to go with them in a few months, after doing lots of research into co-location facilities.

As for the value of trading free space for Joel's article/recommendation, remember that Joel's audience is a) large and b) exactly the kind of person who might consider co-location.  (plenty of hardcore geeks here, who might want to run their own boxen rather than share a drive with hundreds of others...)

aa
Monday, February 10, 2003

...and the next time joel gets slashdotted 500 000 geeks across the globe have the opourtunity to notice peer 1..

Id say that pays for  2Us of rackspace.

Eric DeBois
Monday, February 10, 2003

I'm also looking into using Peer1 as a result of Joel's plug, so I'd guess that Peer1's decision to offer Joel free service is one that makes economic sense for them.

Of course, Joel made it sound like Peer1 just thought, "Whoa, Joel, u've got a kewl site.  It's soo kewl we'd love to host ya for free." 

From what I'm able to tell, Peer1 is a thoroughly professional outfit and any decision to host Joel for free was purely a marketing move.

I have noticed that Peer1 is still not a profitable enterprise. That makes me a bit leery about trusting my needs to them.  They do seem to be ramping up quickly, though, and I'm guessing they'll turn a profit soon and be around for quite a while.  (Financial info is available on their site, though I don't believe they're publicly traded or under any obligation to make this info public.) 

Herbert Sitz
Monday, February 10, 2003

Perhaps Joel should not have publicly disclosed the financial details of the arrangement in the first place. Doing so appears to have had absolutely no positive effect for anyone involved. If I were in this situation on either end I would have left the arrangement to mystery.

Sic: has a business ever given you an exceptionally good deal on a product or service and said "please don't tell anyone?" This kind of discussion is exactly why.

FWIW - in my opinion, the JOS name is credible to serious developers, exactly the group that makes the sort of purchasing decisions that favor an outfit like this web host. It may not "feel fair" but it's apparently just a pragmatic business decision.

Bored Bystander
Monday, February 10, 2003

I think what's on the mind of some is that it has the line between editorial and advertising content has become somewhat blurred recently. Would the articles on Peer 1 become any less educational if the name of the company was ommitted?

I usually just skim the articles relating to bug tracking, because I simply don't know if the opinions are given just to support sales of FogBugz.  Was the article on the poor Dell service written to get better service in the future? I don't know, and will never know, but I still try to ask the question.

Maybe I'm making a mountain of a molehill, but it's always important to check an author's motives, as much as possible anyways.

D Diggler
Monday, February 10, 2003

Actually, I don't think it would have been ethical for Joel to plug Peer1 and at the same time not reveal that they're hosting his site for free.  That would be sort of like a brokerage tagging a stock as a "buy now" without revealing that it has that company as a client.  Sleazy.

I don't think anyone thinks it's unfair.  Joe's just an "Academy member" who gets special treatment.  ;)  I'll get the same treatment when I reach the same pinnacle. 

Seriously, Joel's deal is not that different from any other deal; contractual "consideration" is offered by both sides:

In Joel's case, he gives Peer1 a valuable plug and in exchange receives Peer1 services.

In my case, I'll give Peer1 some valuable money (because my plug isn't worth anything yet and they have no use for it), and in exchange I'll receive Peer1 services.

That the way the world works.

Herbert Sitz
Monday, February 10, 2003

>>I think what's on the mind of some is that it has the line between editorial and advertising content has become somewhat blurred recently. Would the articles on Peer 1 become any less educational if the name of the company was ommitted?


That's a good point.


On one hand, Joel's candor re: the free hosting arrangement allows the reader to make up their own mind and puts everything on the table top w/o apparent buried motives. If he had done as I suggested above (kept "mouth wide shut" about the arrangement) his endorsement of this web host in his article may have appeared suspicious to some readers. But it would have been easier to deflect criticism via "deniability" both for Joel and for Peer 1.


I posit that you'll *never* avoid offending anyone when you take a distinctly positive editorial position. As soon as you say "X is good" many jump in to suggest that there's collusion going on.

Bored Bystander
Monday, February 10, 2003

Maybe Peer 1 read Joel's articles, and thought, "Hey, this guy's writing is really great stuff, let's do this guy a favor, we can afford it."

And maybe the free advertising didn't even cross their minds.

I can't believe how obsessed you people are with "why Peer 1 gave it away for free."  People do nice things all the time for people in their community/cohort/tribe.  Haven't you ever read stuff about how geek culture is a "gift economy"?

It's silly to obsess over it.

programmer
Monday, February 10, 2003

Um, Joel, if your reply below is your way of saying you have Academy Award Tickets, I'd like some!

Steve Walker
Monday, February 10, 2003

I was merely reacting to how it was presented:

There are 3 types of hosting providers:
1) snobby
2) small
3) free

I thought #3 was going to be totally qualitative.

I find Joel ultra-credible so I didn't really mind. It just struck me as unexpected and easily mis-perceived. And the Academy analogy would only work if hosting service was a one-time, $9.50 charge.

pb
Monday, February 10, 2003

Bored Bystander said:
Perhaps Joel should not have publicly disclosed the financial details of the arrangement in the first place. Doing so appears to have had absolutely no positive effect for anyone involved. If I were in this situation on either end I would have left the arrangement to mystery.

D Diggler said:
I think what's on the mind of some is that it has the line between editorial and advertising content has become somewhat blurred recently. Would the articles on Peer 1 become any less educational if the name of the company was ommitted?

*****

I don't think there is any problem at all. Movie critics get to see movies for free so that they can tell everybody else if they like them. And movie critics are usually pretty honest about their opinions. In fact, most movie critics seem to hate most movies, yet they still keep getting free movies.

And, whether Joel posted a favorable review or a review that totally trashed them, the value of a link from a site like Joel's is valuable in and of itself. Google's page rank system keeps track of how many sites link to your site. And they keep track of how many sites link to the sites that link to your site. So, if you've got a link from Joel, your own page-rank will increase, because Google assumes that you yourself must be important in order for someone else important to link to you.

And when your business sells a product that is essentially the same as the product of all your competitors (i.e., server co-location), being differentiated by a higher position within a Google search can give you at least a slight advantage over the competition.

Benji Smith
Monday, February 10, 2003

Nice way to look at it Benji!

Prakash S
Monday, February 10, 2003

Not really. You're comparing something that's a one-time $5-10 transaction vs. a recurring $400-1000 payment.

Secondly, do we really even know if movie reviewers get comped tickets?

Thirdly, critics like restaurant critics and Consumers Reports specifically do *not* get comped for the very reason that they want their experience to be average.

Fourth, if the service being rendered truly is commodity-like, price becomes the most significant factor.

pb
Monday, February 10, 2003

p, just to clarify, i meant the google part Benji refers too.

Prakash S
Monday, February 10, 2003

Restaurant critics don't want comps because they want to make sure they don't get special treatment. Movie and theatre critics do get comps; because its a little hard to give the reviewer a specially good version of the movie.

David Clayworth
Tuesday, February 11, 2003

Believe it or not the Academy actually pays total nobodies (and i'm not referring to the movie stars real worth!) to hang around in tuxedos and evening dress in case the place looks empty.

So Steve shouldn't be looking for free Academy Award tickets, he should be charging for accepting one.

Of course, he would have to look presentable, maybe even a little sexy!

Stephen Jones
Tuesday, February 11, 2003

So Joel are you implying that you're a celebrity?

celebrities__detector
Tuesday, February 11, 2003

Special message for "Bored Bystander":

From Webster's 10th Collegiate:

Main Entry: sic 
Pronunciation: 'sik, 'sEk
Function: adverb
Etymology: Latin, so, thus -- more at SO
Date: circa 1859
: intentionally so written -- used after a printed word or passage to indicate that it is intended exactly as printed or to indicate that it exactly reproduces an original <said he seed [sic] it all>

Your English teacher
Tuesday, February 11, 2003

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