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In the physical world, practically nothing is unlimited. From food to energy to freshwater, there's a limit to just about everything.

But in the world of technology, where the cost of a megabyte of storage or a minute of computer processing has effectively dropped off a cliff, things are different.

That has been good news for many internet businesses. Businesses like online backup service provider Mozy. Confident in its ability to provide backup storage space, it offered a plan with unlimited storage space. For those with huge amounts of data, particularly photos and videos, Mozy's offering was particularly appealing.

But Mozy discovered that there really is no such thing as 'unlimited', and yesterday had to tell its customers. Launching a new pricing model, Mozy President Harold Kodesh explained:

We’ve noticed a growing shift in people’s storage behavior. Photo storage demand has steadily risen as higher and higher megapixel cameras became cheaper and cheaper. With the advent of inexpensive video capture devices, including the first video-capable iPhone (and subsequent Android devices), the trend in demand for video file storage began to increase rapidly. From Mozy's unique perspective, we can see that as people become accustomed to having a video device on hand at all times, they get into the habit of capturing memorable life-moments as video.

He went on:

These two trends—increasingly better quality capture devices and our growing tendency to use these devices almost reflexively—necessitate that the online backup industry must adapt. Companies like Mozy must now account for the storage demands of customers who are increasingly more habitual about capturing memories as digital media.

Clearly, when Mozy launched, such trends may have been difficult to anticipate in terms of their magnitude, and now Mozy must adapt to continue operating in a viable manner. That's fair enough. But needless to say, there will be more than a few unhappy customers, and having to go from 'unlimited' to 'limited' -- in any form -- is not a fun experience for most businesses.

That's because, even if customers should understand where you're coming from, you're still going to be perceived as taking something away. And these unhappy customers sort of have a point: if unlimited is only available to customers until providing it puts a burden on you, was the offer ever really legitimate?

Mozy's move highlights an important lesson for business executives, entrepreneurs and marketers alike: just as there's no such thing as a free lunch, there's no such thing as an unlimited one. There are always limits, whether you're selling widgets or storage space. When starting out, those limits may seem unreachable, and it's often easier to sell 'unlimited' to prospective customers. But if you're lucky enough to grow to the size at which those limits become apparent, you'll be unlucky to have to tell your customers.

The better, if less expedient, approach: don't offer anything you technically can't provide anyway, like unlimited storage space. In the long run, you'll probably be better off for it.

Patricio Robles

Published 2 February, 2011 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (1)

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What Contract

Calling something 'unlimited' when it's clearly not isn't new, take broadband or mobile phone contracts with 'unlimited texts' for example. All refer to a fair use policy usually well hidden from the visitor. At least Mozy is coming clean.

over 5 years ago

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