Lots of people are angry at Evernote today for increasing their prices and squeezing functionality out of their Free Plan. But these upset users are a good thing and so is this decision — for 3 reasons:

1. Better monetizes their core users

Evernote’s core users are not the ones posting angry tweets, they’re the ones that find so much value in the product already that paying the extra dollar or two per month is still a great deal. Increasing prices better monetizes these users without upsetting them. I would happily pay 2X what they’re charging after the increase.

2. Pushes the upgrade sooner

Evernote has always had an incredibly generous Free Plan. So generous that most people could use Evernote regularly without any need to upgrade. A big problem was that, other than upload limits and searching inside documents, there were few limits Evernote could apply to the free plan that wouldn’t feel contrived and affect their core offering.

Recently, however, Evernote’s been integrating acquisitions (like Skitch and Penultimate) into the app and building our features that could differentiate paid plans while maintaining a useful free version.

One new limit on the Free Plan — only being able to use it on two devices , for example— is the type that precisely targets users who already see the value and are ripe for upgrading. It’s also a signal that Evernote is confident their paid plans offer enough value.

3. Focuses the company

Evernote’s biggest challenge has always been telling people what to use it for — versatility has been both a strength and weakness. To help, they built all kinds of separate apps for specific uses like Food for food photos, Hello for notes about people, and Peek, which used the iPad’s Smart Cover, for studying. This divided attention resulted in poor quality and neglecting the core app — they were not focused.

Since hiring their new CEO, they’ve closed or abandoned most of these apps or rolled them into Evernote proper, a sign they are focused on what made them great to begin with and this can only lead to good things.

Upset = Good

Upset users of your product are always hard to stomach but they’re also a good sign. It means your product was useful to them. No one gets upset about changes to a product they don’t use.

The challenge for Evernote isn’t to make their product useful, but rather to show people that it is. And now that they’ve doubled-down on their core users and core app, they’re going about it in the right way.

Personally, I couldn’t be happier about paying more because it means more features for users like me and a business that’ll be around for years to come. And as someone whose life would be in shambles without it, that’s great news.