Bait & Switch: Buy A Lifetime Account For As Long As We Exist Or Until We Get Tired Of You
from the not-so-nice dept
Via Slashdot, we learn about how Joyent offered early customers a "lifetime account," (via TextDrive, a web hosting company it acquired) in which they promised the account would exist "as long as we exist." Well, the company still exists, but it's now sent notices to those lifetime customers telling them that their "lifetime" is apparently up on October 31:We appreciate and value you as one of Joyent's lifetime Shared Hosting customers. As this service is one of our earliest offerings, and has now run its course, your lifetime service will end on October 31, 2012One would imagine that the FTC might have some questions for Joyent's management on the nature of living up to the promises of what was offered. Jason Hoffman, who apparently co-founded both TextDrive and Joyent, seemed to make things worse with his defense of the decision, basically admitting that this is screwing over their earliest supporters and biggest advocates:
Having co-founded two companies that ultimately became Joyent, growing from a tiny startup to where we are today has had its ups and downs, and this is one of the toughest decisions I’ve made. In particular because I've always been the biggest advocate for pushing a shared hosting product forward, and then here I am, the only remaining "founder" that is active.This seems to go back and forth. First off, it's not "ironic" that you're screwing over your early supporters and not giving them what was promised. It's a highly questionable business practice. As for not being able to make an argument for why the service can continue, one would think keeping Joyent's name and reputation from being dragged through the mud would be a potential argument. Also, avoiding possible smackdowns from government officials for selling one thing and delivering another.
It's ironic that our biggest advocates are the ones most affected by this and I know many of you are disappointed in me. I’ve received many questions and comments about why the service is being discontinued and I'm listening and will continue to listen. And like the past, this response won't be my last.
Making the decision to discontinue the service was extremely difficult. It was driven by some simple things: the hardware is simply old (6-8 years old), it's failing, there isn't an upgrade path from it, there's more than many of you likely realize and oddly enough it's more expensive with time (while not being used much). The rest of the Joyent's business has been paying for that, and I can't make the argument as to why it can continue.
Yet, we're only here because of the initial community that trusted us, and I'm genuinely grateful for the support. I’m sorry that I've lost that trust and I've upset you. You have a right to be upset. This was a tough decision with some nuance to it and none of this is lost on me.
I recognize that things change and businesses change over times. But the company did make the promise that these were lifetime accounts and that they'd stay up for as long as the company was around. It seems only reasonable that it should not just cut off those accounts without any sort of recompense.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Filed Under: bait and switch, ftc, lifetime account
Companies: joyent, textdrive
Reader Comments
Subscribe: RSS
View by: Time | Thread
[ link to this | view in chronology ]
?
[ link to this | view in chronology ]
Re: ?
[ link to this | view in chronology ]
Nothing New...
Two that come to mind are OpenDNS and phoneFactor.
OpenDNS is/has removed features from their free offering and phoneFactor used to make the service much more freely available.. but is now limited to 25 users.
[ link to this | view in chronology ]
Re: Nothing New...
'Cause I don't think so.
Plus, I would think that the transaction of money means you are far more "on the hook" for original promises.
[ link to this | view in chronology ]
Re: Nothing New...
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Re:
It's a poor excuse when you made a promise to a customer.
[ link to this | view in chronology ]
The msot insulting line
I can't even believe that he wrote that.
The argument for continuing it is, of course, "because we promised to."
[ link to this | view in chronology ]
Re: The msot insulting line
[ link to this | view in chronology ]
Re: Re: The msot insulting line
[ link to this | view in chronology ]
Re: The most insulting line
My pick for most infuriating line:
For "upset" read "cheated", and for "lost" read "betrayed".
[ link to this | view in chronology ]
Re: Re: The most insulting line
[ link to this | view in chronology ]
So, what's new?
[ link to this | view in chronology ]
Re: So, what's new?
[ link to this | view in chronology ]
Blatant fraud?
If he wants to default on creditors he needs to declare bankruptcy. Whining that old customers lured in at a low price are subsidized by new customers then he has only his ponzi-scheme business model to blame. Just defaulting on his contractual obligations isn't, AFIK, a legal option.
[ link to this | view in chronology ]
Re: Re: So, what's new?
Breach of contract is where one party unilaterally changes the deal (nearly always to the disadvantage of the other party). The contract has already been entered into at that point. Breach of contract is much more serious because there is no easy way for the victim to avoid being victimized. They have to take legal action, which many victims are very reluctant to do.
[ link to this | view in chronology ]
Re: Re: Re: So, what's new?
This is a unilateral contract; any changes made by the 'writer' of the contract that benefit the other party (non-writer) are considered liberalization of the contract -- not breach.
Further to the whole situation:
[ link to this | view in chronology ]
Some companies keep their promises
I'd love to see the early customers band together to launch a class action lawsuit against these clowns. No one really wins in those things except the lawyers, but if it makes the company keep their promises, great. Otherwise, they deserve to go out of business.
[ link to this | view in chronology ]
We can't tell which businesses keep their promises until the business ends.
In this way, it's like losing weight and keeping the weight off—the implication is that the dieter kept the weight off for the rest of their life. Hence, a dieter can never make this claim about themself because this claim can't be made until after the dieter dies.
But some responsibility should go to the would-be customer too: it's not reasonable to expect that any business can last by devaluing their goods/services for a one-time payment.
Magnatune.com offers a "lifetime" membership for a one-time payment of at least $240 (you're free to pay more if you wish). Given that "50% of membership fees go directly to the artists who are listened and downloaded", I still don't quite understand how lifetime membership payments are doled out to artists since Magnatune can't really compute how much to give an artist until the lifetime membership ends (only then would Magnatune know the complete download list for lifetime member). But I bought into this account figuring that when it ends I think I'll have downloaded at least $240 worth of music, and I enjoy supporting art that is licensed to share. I can only guess that Magnatune pays the bills based on licensing music, and ongoing-payment customers (like $15/month members). If they ever discontinue a lifetime membership like Joyent did, I'll consider them to be a disreputable organization with which to do business; as others have noted here the business chose to offer this deal with these terms. But for now I have no evidence things will go that way.
[ link to this | view in chronology ]
Re: We can't tell which businesses keep their promises until the business ends.
It's just like with the dieter; no one (may except for you) actually think that they mean that they will keep the weight off for the rest of their lives, just that they have done so so far.
[ link to this | view in chronology ]
Re: Some companies keep their promises
[ link to this | view in chronology ]
Re: Re: Some companies keep their promises
[ link to this | view in chronology ]
Re: Re: Some companies keep their promises
> like many other internet related companies.
Well, if the company can change the contract at their whim, so can the users. That sword cuts both ways.
[ link to this | view in chronology ]
Yes, you are getting hosed over
Now THERE is a business model that sounds familiar.
[ link to this | view in chronology ]
Uhh, self-fulfilling prophesy anyone?
[ link to this | view in chronology ]
Uh...Bait & Switch?
"denoting a deceptive method of selling, by which customers, attracted to a store by sale items, are told either that the advertised bargain item is out of stock or is inferior to a higher-priced item that is available."
This is just straight up fraud.
[ link to this | view in chronology ]
They're not all like that...
[ link to this | view in chronology ]
Re: They're not all like that...
[ link to this | view in chronology ]
Major bogosity!
So, I say to Jason Hoffman this: don't expect to keep many of these customers around, and expect that the back-blow from this to seriously and negatively impact your company's sales and profitability. Personally, I think you just kissed your company goodbye...
[ link to this | view in chronology ]
A form of self-fulling prophecy
The net result is that those lifetime accounts in question lasted approximately "as long as [the company] exist".
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Typical, sadly.
Winamp was a tiny little MP3 player application. The nerd that created it sold tiny little licenses. Basically, it didn't do much more than help defray some costs but at least you got a regcode and the satisfaction of helping Nullsoft succeed.
Then AOL bought them. And, the thing that *really* burned me, aside from the bloated software and higher pricing, was the loss of my regcode. My cachet, so to speak, of being an early adopter. I was there. I helped. My brick is in that wall. And Justin sold the building and threw the brick in the garbage.
It's these kinds of things that stay with you.
-C
[ link to this | view in chronology ]
Re: Typical, sadly.
(I do remember the regcodes—there was some debugging tutorial which, as an example, showed how to set a breakpoint and read a valid code from RAM.)
[ link to this | view in chronology ]
The Road to Hell
Promises made, money collected, bankruptcy filed.This happens all the time...thousand of businesses fail every day.
The Road to hell is paved with good intentions...
You move on.Nothing else you can do.
[ link to this | view in chronology ]
Re: The Road to Hell
[ link to this | view in chronology ]
Re: Re: The Road to Hell
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Re:
[ link to this | view in chronology ]
Seems simple to me...
I'd be looking at a nice class action for this. Even if you lost, you'd at least drive this 'Dodgy Brothers' company into the ground. Since you're going to lose anyway, might as well take the scumbags with you :-)
[ link to this | view in chronology ]
Re: Seems simple to me...
Thus allowing the shafted customers bring final justice to the end of the bargain.
The company said it was a "lifetime account", and since they are cutting everyone off who purchased one, it's only logical for those "everyones" to make sure that it's because the company is actually gone.
Fair is fair, balance of power, revenge is a dish best served cold, Mutually Assured Destruction (the company launched it's nukes, time to launch ours), etc... and all the fallout that comes with it. Goodbye, business that I used to know.
[ link to this | view in chronology ]
The "why".
In other words, they cheaped out on technical support, maintenance, and upgrades. Now where have I heard that before? Well, pretty much everywhere I've worked in IT. After all, it's much more important for the execs to maximize their salaries and for the shareholders to get their dividends and ever rising share prices than it is to ensure the damned Rube Goldberg contraption continues to do what "Sales" said it would do.
"Ah, but IT is a cost centre, don't you know?"
I don't often find myself in the "Sue!" camp, but in this case, I am. People like this are a blot on the industry and it would be better if it were rid of them. Joyent doesn't deserve to live. I'm a bit surprised that some cracker/hacker/Anonymous hasn't ripped 'em a new one if this's how they do things.
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Life Sucks, Move On!
The company could probably phase this out more gradually. If the hardware's failing and it's going to cost them too much to virtualise then what else can they do? Sticking to the line "we promised" isn't a viable business model.
Techdirt is always ready to criticize companies and organizations for sticking belligerently to failing business models. Well when things change there are often casualties. You can't have it both ways.
[ link to this | view in chronology ]
Re: Life Sucks, Move On!
If "we promised" means "we signed this contract", then yes; sticking to it is a viable business model. Or more correctly; breaking the contract because you miscalculated is NOT a viable business model - it's breaking the law.
[ link to this | view in chronology ]
Shallow as a pane of glass. You don't see any difference between the MafiAA's way of sticking to an obsolete business plan, and some jerk promising the moon and then yanking it out from under paid customers whenever they feel like it? Promises mean nothing in your Universe? I'm glad I'm not your customer.
If Joyent can't honour its deal, its only recourse is to go out of business with apologies for failing, not to screw over its paid customers.
You must be a manager, yes? MBA?
[ link to this | view in chronology ]
You cruel people - have you no souls?
See?! Not just difficult, but *extremely* difficult. All that money his company saves for simply ignoring the contracts with their long standing customers... sure, that is a abhorrent behaviour generally, but not if its difficult decision or even extremely difficult decision.
I mean, put yourself in his shoes for a minute. Can you image having to receive questions and comments? Do you know how difficult it is to listen? He's promised to make sure that he isn't even going to cease responding...
What more do you want from him? Blood?
[ link to this | view in chronology ]
The Last Word
“