Before, you could get "up to 12k emails per month" for free.
Now, you get 2k free sends once (for dev), and then have to pay $9.95/mo.
This all sounds actually great, so far (although, I think $4.95/mo would have been a better bottom-tier plan - the goal is to get rid of users that don't pay anything but send 12k emails per month). $9.95/mo is affordable to any startup, and it's sustainable (vs paying accounts having to cover the cost for the hundreds of thousands of users sending millions of emails for free).
The mistake they made was in doing anything else besides this. If they had simply changed the pricing like this, but left everything else alone, they would double their profit in 5 minutes while only pissing off the customers that aren't ever going to pay anyway.
Instead, they did what they did, and now they're no better than TWTR.
Couldn't agree more. I was sending a couple of thousand emails a month with mandrill for free. Would have happily paid 9.95 a month. But when I got their email, and read their blogpost, it was completely unclear what I had to pay. The message I got from them was, "sorry, don't want your business."
With this, and Kimono, in one week, I am moving to amamzon ses, though it has very few reporting features. Sorry Sendgrid/Mailgun, but TWICE burnt, and all that...
Sendgrid has been in the game for a long time and has it as their core business (unlike mandrill). So I wouldn't be too afraid of them closing down overnight.
> the goal is to get rid of users that don't pay anything but send 12k emails per month
I agree, but you even understate the problem. If your API-based SaaS offers a free plan, then you can't actually enforce any caps on that plan. Anyone who uses your service can just register N free accounts and multiplex their load across them, to get as much usage out of your SaaS as they like. (Yes, even if you make them register with a credit card and deduplicate by card number; registering a bunch of Visa gift cards that don't have to maintain a balance is essentially "free.") The only real way to get around this—besides eliminating your free plan—is full-on "submit your birth certificate" KYC.
Of course, this doesn't apply if your SaaS is delivered as a web service or a fancy thick client, where the raison d'être is mostly in the UX—it's hard to multiplex that. But when your service is just an API, it's dead simple.
It's not about sealing a security hole. It's about increasing the cost and decreasing the value for abusers, to reduce the amount of abuse to a sustainable level.
Firstly:
Before, you could get "up to 12k emails per month" for free.
Now, you get 2k free sends once (for dev), and then have to pay $9.95/mo.
This all sounds actually great, so far (although, I think $4.95/mo would have been a better bottom-tier plan - the goal is to get rid of users that don't pay anything but send 12k emails per month). $9.95/mo is affordable to any startup, and it's sustainable (vs paying accounts having to cover the cost for the hundreds of thousands of users sending millions of emails for free).
The mistake they made was in doing anything else besides this. If they had simply changed the pricing like this, but left everything else alone, they would double their profit in 5 minutes while only pissing off the customers that aren't ever going to pay anyway.
Instead, they did what they did, and now they're no better than TWTR.