Ask HN: does pay per use pricing method works?

[meerita]

I'm tired of seeing the same pricing systems on every startup it comes out: plans. I understand they are designed well and is common in the industry at this time but I think we can improve more. Some pricing plans are well distributed but some others, not. They just list a bunch of stupid features just to fill up the list and become something important to show.

I am developing a SaSS system and I want to implement a different approach for pricing. It starts with $10 for everyone, but you need to pay extra when you need to use or do other stuff.

Let's say you're 37signals Basecamp and, one feature is SMS alert. You either can pay the pro account extra 200 a year or instead you pay those SMS you need to send that x month for that x project you're working on. If it becomes a must feature, you pay a fee and you have it for default in your account. If not, you pay per use.

I've researched a lot for my project and I found people doesn't need all the features all the time. Most of the features I've been researching to put on the system are, more used occasionally than usually. I want to charge for the occasional use and, if it becomes a must, you can pay it too instead paying for something you will never use.

Has anyone tried this system and can share results? I don't know the side effects of this in real world projects. The only effect i tested with people told me that plans makes things attractive because "it has that and that just in case i need it to use" and that's all.

[namenotrequired]

The pro of plans from the business side is also that people pay for what they may not use. If you now have a plan that charges $40 for 400 uses and change that so that people pay $.10 for every single use, the revenue will simply be a lot lower - because these people may use 200 or 300, and if they were planning to really use around 400 they'd probably get a plan that offers them more to ensure they don't run out too early. So ultimately you'll need to charge quite a bit more per use if they only pay what they really use.

[caw]

I think you just re-invented the cell phone data plan in the US. You can sign up for a dataplan with XGB, or you can have 0GB and pay per MB at a much higher cost. Your baseline pricing of $10/month is analogousness to the minutes that you have to have with your phone. Seems to work out well enough for the telecoms.

[meerita → caw]

Do not get me wrong. I have not re-invented anything :), just want to see if the system currently used by some operators can be applied to communication systems startups. The television broadcasters also use the pay-per-use model.

[focuser]

I'm investigating this too -- in fact I almost post the same question here until I found your post.

One of the concerns I have is that this kind of pricing method may be a lot more complicated to design and implement. Also it may confuse customers if you have a huge feature list rather than 3 simple plans for them to choose.

[meerita → focuser]

I'm thinking the advantadges too. Let's say you have a hosting company and in the future you want to add XXX feature wich is new to the market. You can add it easily and charge it later. With packs you need to address wich plans will have it, then apply and everyone will have this even if they don't use it.