If they offer a free service, how does Discord make money? So as Discord continued to gain popularity, many people started wondering how this company supports its operations.
Discord was launched in 2015 as a free VoIP app designed specifically for the gaming community. It allows text, voice, and video chat through its platform that runs on almost any device. By the middle of 2018, over 130 million users were using Discord software.
It offers a free application and does not appear to have any revenue stream. So if you have been watching this application and the company behind its development, here is what you need to know about Discord.
What Is Discord and Where Do You Get It?
Discord is a video, text, and voice chat application designed for gamers. It was conceived as a social gaming platform and has expanded into other areas.
The company manages 11 data centers to support its servers, which provide low-latency voice chat. The software also requires fewer resources compared to its competitors, such as Skype and TeamSpeak.
You can download the application to almost any internet-supported device. Discord has released versions that are available on Windows, MacOS, iOS, Android, Linux, and web browsers.
The framework used to design the application allows it to be multi-platform. A person using Discord on a personal Windows computer can communicate with someone using Discord on an Android smartphone.
The ease of use and quality voice and video connections made Discord popular in the gaming world and other online communities. With over 130 million users and 450 Discord servers, this application has become a big hit. However, it is still free to use.
Discord also released a free tool called Gamebridge. This tool allows developers to integrate Discord into their games or applications. You can now integrate Discord into Twitch and other popular applications.
There is also a growing list of games and services that support Discord. In fact, Microsoft recently announced that they will provide support for their Xbox Live users. Xbox Live users will be able to link their Discord and Microsoft accounts to access features from both services.
The Core Discord Services Are Entirely Free
After Discord was released, the application quickly began attracting users. The biggest attraction for new users is that Discord is entirely free. You do not need to pay to use the core services offered by Discord, including the basic text, video, and voice chat.
With these types of free services, you typically expect the application to display advertisements. If the business does not charge for their services, advertisements are a common source of revenue.
Discord does not display ads. In fact, the business stated that they have no intention of ever displaying ads through their applications.
If they do not use ads, how does Discord make money? After ad revenue, selling user data is the next most common way for applications and services to make a profit.
Many businesses sell the information that they obtain about their users to third parties. They may sell the names and email addresses or any other information that you provide when signing up.
Discord does not sell user data. They have explicitly stated that selling user data is a breach of trust. Along with not displaying ads, they do not intend to ever sell information to third parties.
Without these two common sources of revenue, how does Discord make money? At first, the company relied on their startup capital to fund their operations. However, that is not a sustainable revenue stream.
Discord Sells Merchandise Containing Their Logo
To start making money, Discord began selling merchandise. They offer a variety of merchandise featuring their logo. You can buy t-shirts, hats, hoodies, and other items with Discord branding.
While Discord may generate a small amount of revenue through the sale of merchandise, it is unlikely that branded clothing will cover their operating costs.
Discord Launched a Paid Subscription Plan
Discord eventually introduced a real strategy for generating revenue. They introduced a paid subscription model called Nitro, which includes two different plans.
The paid subscription does not impact the initial Discord services. Users can still download, install, and use Discord for free. However, the paid plan does offer a few added features, such as:
- Higher quality video
- Large upload file size
- Animated GIFs
- Custom tags
These features are available with either of the two Nitro subscription plans. These two plans are called Nitro and Nitro Classic. With the standard Nitro plan, you receive unlimited access to a library of games that support Discord chat.
The games in the library include a mixture of indie games and AAA blockbuster games from major developers. The list is still growing. You can download these games and play them for free if you keep your Nitro subscription.
With Nitro Classic, you get to enjoy the same perks offered with the standard Nitro plan at half the price. However, you do not get access to the game library.
Does Discord Have a Viable Future?
The people behind Discord do not believe in using advertisements or selling user data to support their company. They want to offer an open source platform for text and video chat. They have succeeded in this effort, as more people and developers continue to adopt this service.
To remain afloat, how does Discord make money? They started selling merchandise, which is a common tactic. Unfortunately, selling t-shirts and hoodies is not enough to support a technology company like Discord.
The release of a subscription plan may offer Discord a viable strategy for long-term, sustainable revenue. The subscription model is often effective when paired with real benefits. The benefits offered by the Nitro subscription should attract gamers.
With Nitro, users can access a growing library of games for free. These games already have Discord chat integrated into the game, which should help with overall user retention.
In the end, Discord is on the right track. It took nearly three years to release a real source of revenue. However, with Google shutting down Hangouts in 2019, there may be more demand for free VoIP services like Discord.