It more than doubles our income while still having only a 10% overhead for users. Typical could storage overhead is closer to 40%, and that's the number I've been told many times that I should be charging, which seems completely absurd to me. Most people don't believe that we'll have enough money for development, let alone marketing. Typical cloud storage operations apparently are very expensive and have many more costs than just the hardware. We'll have to see how that works for Sia, but 10% seems like it'll bring in enough cash to me.

In terms of scaring away users, I'm pretty confident that our host-picking algorithms and erasure coding will put us substantially more than 10% cheaper than everyone else, including decentralized competitors like Storj, MaidSAFE, and Filecoin. You may be paying a 10% fee to use the network, but even with the fee it's going to be the most attractive option for both hosts and clients. (clients will need less redundancy, which means they are paying hosts more per raw TB, but less overall, and getting the same or even a greater level of security). We are planning on leaving ourselves room to reduce this number if it prevents us from being competitive in the marketplace.



We are trying to maximize the value of each siafund. We believe that by making the fee 10%, we'll be able to hire more developers in a way that gives us a stronger edge than we would have from increased users due to a reduced fee. If Nebulous has twice the money, we can hire twice the developers and end up with a much stronger product. We believe that this stronger product will be the dominant factor in the number of users that we have, and that the 10% fee will be negligible, especially when compared against a 50% savings over the competition.

Meaning, we believe that by giving ourselves more income, we believe we'll also be able to boost the value of each of your siafunds (by being able to grow faster and have a stronger product) even though the percent of the fee you are receiving is the same. The percent is the same, but we think that the total volume of usage will be higher.

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Most importantly though, I feel very obligated to stick to the 0.00039% value that I've repeated many times. I've encouraged everyone to make decisions around that number and not any other number. Changing that number means we're altering what we told people to expect when they were making their investment decisions. People who chose not to buy may have decided to buy in the event that each sianote would actually be worth more than 0.00039%.  Furthermore, if we create a precedent for changing this value, you lose the security of knowing that it won't decrease. If we decide later that a 10% fee is actually bad (because Storj, for example, ends up being 10% cheaper) and we need to reduce it, do we also drop how much a sianote is worth? How will that affect people who have been investing in the sianote?

I realize that changing the total fee is a big move, but I am trying to do the right thing. If it ends up being a major source of contention, and you guys feel universally that you are being cheated because we raised our fee without including you, all that will happen is we reduce the fee back to the original 3.9%. I feel that this would hurt Sia overall because it affects the number of people that we can hire, that affects the quality of the product. But I would much rather set the total fee at 3.9% than set a precedent of adjusting the income provided by the sianote, even if the first adjustment was upwards. I don't  think that I would ever feel comfortable adjusting the number down from a previous amount (if I did decide to set it at 0.001%, I would never lower it), and that would back us into a corner if we suddenly realized that the fee was too high, because either we have to fully take the hit ourselves (to isolate our crowdfunders) or we have to lower the value of the sianote back down from 0.001%, which would violate expectations that we had set.

I'm willing to work with you guys on this, but I'm very nervous about straying from the 0.00039% value that I've repeated so many times. I don't think it would be right to adjust those expectations.