Facebook vs. Ning: The Cost of Free Social Media

Posted by · October 24, 2011 11:57 pm

It started in Q&A. Then last year, the New York Times brought it to mainstream media. And now, the free versus paid debate has spread social networking.

In an article for tech website Smallbiz Technology, contributor Ramon Ray wrote a brief expose on “an undercurrent of companies” that have chosen to decrease their dependence on social media emperor Facebook. What are they doing instead? Ray notes that several companies have resorted to private social networks, which allow companies to exercise more autonomy in the way that their communities are administrated.

Moreover, Ray continues, favoring the use of such private social networks has enabled businesses “to grow their audiences within a more private and controlled wall.”

Examples of such private networks include Ning and Contain. The upside of private social networking for businesses, at least according to Contain, is threefold. First, private social networks are said to give companies “real say and control” when it comes to the creation and organization of their social community. This is contrasted with the “several restrictions” imposed by social media giants like Facebook and Twitter. Second, companies are able to advertise within their community. This benefit, suggests Contain, results in increased traffic, sales, and overall ROI. Finally, private social networking lets businesses “minimize the risk” of having negative publicity circulate among consumers, media, shareholders, and other parties vital to company success.

The argued downside, however, is the cost of these private, more business-friendly social networks. At a startup cost of $30,000 and a monthly cost of $3,500, Contain can be quite an investment for some companies. Charging a price that’s a bit more appealing, Ning’s PRO package, which is likely most conducive for business users, costs $59.95 a month.

Because of this unavoidable cost-benefit dilemma that follows, Ray seems to conclude that private social networks actually aren’t for most business owners. Instead, he thinks companies “would be best using a public network like Facebook or Twitter,” making more elite networks like Ning and Contain appropriate only for “some brands.”

However, I’m not so easily convinced. After all, cost is not exclusively monetary.

You see, for some, free social networks like Facebook and Twitter are more than enough. Free of charge and open to everyone, these networks are a bastion of riveting conversation and beneficial interaction to some. And yet, to others, they can be the bane of one’s online existence.

For those who resonate with the latter, the word free is synonymous with nuisance. To engage in one successful interaction, it requires far more time and effort than could ever be justified by avoiding a monthly or yearly fee. To them, it’s worth paying a relatively low price to know that their time is well spent.

In other words, both have their purposes. While monetary cost may trump the cost in time, effort, and inevitable frustration brought about by a free service for some, an increasing number of businesses and individual consumers alike seem to be interested in the idea of trading money for efficiency and reliability…and more money.