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LibraryH3lp is software used by libraries, educators, and non-profits for better customer service.

Thursday, May 3, 2012

Price restructuring ahead

We wanted to let everyone know that we're changing our subscription rates very soon.  The new rates will go into effect for subscription terms beginning on or after June 1, 2012.  Some of those invoices will begin going out next week.  We'll get down to the financial details in a bit. But first up, here is some background information.

When we very first started charging for LibraryH3lp, we had a very coarse payment structure because we were using PayPal for credit card processing, and that only let us have 5 payment categories.  We started out with PayPal because, honestly, we did not begin as a typical start-up venture, with investors, seed funding, and a lot of emphasis on business model.  We were primarily trying to solve a tricky technical problem in order to let libraries provide more modern chat reference services.  PayPal was the quickest, most convenient way to take payments.  Now, we have much more flexible credit card processing and can try to be more fair by being more fine-grained.

As LibraryH3lp grew, we introduced new features, primarily targeted at large organizations and collaborative services: reports, profiles, tag-for-followup, fine-grained permissions, api access, with more to come over the summer.  LibraryH3lp is under constant new feature development.  We're also running nearly two dozen servers worldwide, including several regional servers to provide better response times for libraries outside of the US, and we're currently averaging 1,000 visits to a LibraryH3lp-enabled web page every second.

We are aware that not everyone is interested in or wants to pay for the new features, so the bigger increases are for larger libraries that tend to use those fancier features more heavily, and we're even lowering prices for the very smallest places.  After looking at use data over the last few years, we can see that resource usage is tiny for our smallest customers, but it can scale up quickly once we start getting into population bases of around 5,000 FTE for academic institutions.  So now, we will have four payment tiers at the below 10,000 FTE/100,000 population level, whereas that used to be one single payment tier.  The average price across those four tiers is actually nearly the same as the old price.

We could instead charge per feature or capability, and we may have to do that in the future, but LibraryH3lp has always been about affordable flat fees for unlimited use.  One major benefit of this approach is that it allows you to restructure your service and add new queues, operators and service capabilities without having to ask permission from your vendor or purchasing department.  Also, as a small company, we'd have a hard time pricing everyone on an individual basis.  Creating a system that controls access to features based on whether or not specific features have been paid for would require a fair bit of programming effort. We'd rather devote our programming time to improving the virtual reference capabilities of the system for everyone.

So, what does our rate change look like?  Typical small to mid-sized libraries will see an increase of $100-200/yr.  Our very smallest customers will pay a little less than they have been.  Roughly half of our customers are under 10,000 FTE and will continue to pay < $1/day for unlimited use of an extremely flexible virtual reference platform. Please note the per month break down in the table below simply provides another way of looking at the annual rate; we are retaining our annual subscription model and will not bill on a monthly basis.

FTE (academics)Population (publics)Per MonthPer Year
less than 1,000less than 10,00015180
1,001 - 2,50010,001 - 25,00020240
2,501 - 5,00025,001 - 50,00025300
5,001 - 10,00050,001 - 100,00030360
10,001 - 15,000100,001 - 150,00035420
15,001 - 20,000150,001 - 200,00040480
20,001 - 25,000200,001 - 250,00045540
25,001 - 30,000250,001 - 300,00050600
30,001 - 35,000300,001 - 350,00055660
35,001 - 40,000350,001 - 400,00060720
40,001 - 45,000400,001 - 450,00065780
45,001 - 50,000450,001 - 500,00070840
50,001 - 60,000500,001 - 600,00080960
60,001 - 70,000600,001 - 700,000901080

Bigger populations for individual schools or library systems not covered in the table above will scale up the same way.  We're also getting more interest recently from collaborative services that span multiple institutions; for these, we need to generate custom quotes since there are so many variables, but they always work out to less than the sum of all the partners paying for individual subscriptions.  Please write to us at support@libraryh3lp.com if you would like to discuss a collaborative service.

As always, we'll work with libraries that truly will have difficulty with an increase.  We'll also work with those that are in the trial phase and have done budgeting based on the pricing in place at the time the trial started.  And of course, if we gave you a quote earlier with a different price, we will honor that.  But we think/hope that these rates are still extremely affordable for most libraries, and we hope they will work for you.

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