To be pedantic they are giving away $150k of their own cash but they also provided 10 lifetime accounts which are visionary accounts that you never have to pay for.
Visionary accounts cost ~30 euro/month (assuming yearly subscription). That's currently more or less 30 USD/month and works out to 360 USD/year. Assuming those accounts get 60 years of use out of them that works out to 21600 USD in value/lost revenue. If you assume inflation of ~4% as a random number pulled out of my ass then that's 85k USD instead.
For 10 of those accounts that's 216k USD assuming no inflation and 850k USD assuming inflation.
So all in all that works out to closer to 360k USD in the naive case but more realistically it comes out to 1M USD flat with the inflation matched increase in service cost over that 60 year estimate.
Given this I don't think it's too terribly unfair to say that they are personally footing the bill. That's not to minimize the community's substantial contribution but the reward for this raffle realistically costs Proton as much to run long term as the raffle itself raises.
To be further pedantic, Visionary accounts are priced at ~30 euro/month. They likely cost Proton significantly less than that.
I would also suggest utilisation of those free accounts would be much lower than your estimates (though I appreciate I’m just countering your subjective opinion with one of my own).
Oh 100%. It's not a for sure thing but at the same time I know those plans also historically have been auctioned for a lot of money and as a result the people who end up with them tend to use them quite extensively.
And their cost is probably a decent bit lower than the sales price but given Visionary plans aren't sold directly any more to my knowledge, there's a chance the profit margin on those accounts dipped below a feasible amount and they've just kept the plan for existing users out of goodwill.
That all to say, those lifetime plans are definitely super expensive and probably make up a respectable amount of the raffle income but their exact cost to Proton themselves isn't exactly clear.
It's not pedantic at all. They cost so much less that it renders the entire calculation meaningless. Almost all of the cost of a consumer VPN account is user acquisition (a cost they don't bear in this case). Operations cost peanuts - maybe $1/mo, if that.
It's worth noting that the service isn't just a VPN but also a mail provider and cloud storage provider. And the visionary plan comes with several terabytes of storage.
No, inflation doesn't increase the present value. If anything, the proper way is to discount the future (potential) costs by say 5-10% per year, as the business may not exist forever etc. The net present value of an annuity of 360 dollars with 10% discounting rate is 360/0.1=3.6k. So for ten accounts 36k.
Sure if you discount by less, say 5% (due to e.g 5% yearly price increase) thst doubles to 72k, but it's still much much lower than your wrongly calculated 360k.
How much would you be willing to pay for that lifetime plan? Not 21k. Surely not.
> Assuming those accounts get 60 years of use out of them that works out to 21600 USD in value/lost revenue.
Has any lifetime account for anything ever lasted for an actual lifetime? Short of the gold airline tickets that airlines have been weaseling out of recently?
It's a tech company. I'd charitably assume that "lifetime" means min(how long has the company been offering this service, 5 years (3 if company took VC funding)).
> Has any lifetime account for anything ever lasted for an actual lifetime? Short of the gold airline tickets that airlines have been weaseling out of recently?
I think most lifetime accounts end up lasting an entire lifetime. It just happens to almost always be about the lifetime of the service, not the lifetime of a human.
> Assuming those accounts get 60 years of use out of them that works out to 21600 USD in value/lost revenue. If you assume inflation of ~4% as a random number pulled out of my ass then that's 85k USD instead.
I bought a raffle ticket just for fun last year. If I won, I’d use my account for the foreseeable future. But to say that this would have been “lost revenue” for them is a leap I don’t agree with. I am a user of their free plan. Them giving me a lifetime premium account does not make them lose revenue, when I currently don’t have any plans to buy a premium account and pay for that for 60 years.
And meanwhile, this raffle also works as a form of marketing. Who is to say that among all the other people there isn’t some number of people that will decide to start paying for premium due to the raffle reminding or informing them of premium accounts existing?
Yeah it's definitely marketing and users who win definitely aren't guaranteed to have been paying users anyways however lifetime proton plans historically have auctioned for tens of thousands of dollars and presumably whoever ends up owning those auctioned off plans intend on getting their money's worth out of them. So it's no guarantee of lost revenue but I'd be willing to bet the bulk of those plans get some heavy use.
Visionary accounts cost ~30 euro/month (assuming yearly subscription). That's currently more or less 30 USD/month and works out to 360 USD/year. Assuming those accounts get 60 years of use out of them that works out to 21600 USD in value/lost revenue. If you assume inflation of ~4% as a random number pulled out of my ass then that's 85k USD instead.
For 10 of those accounts that's 216k USD assuming no inflation and 850k USD assuming inflation.
So all in all that works out to closer to 360k USD in the naive case but more realistically it comes out to 1M USD flat with the inflation matched increase in service cost over that 60 year estimate.
Given this I don't think it's too terribly unfair to say that they are personally footing the bill. That's not to minimize the community's substantial contribution but the reward for this raffle realistically costs Proton as much to run long term as the raffle itself raises.