
Buffeted by the Web, but Now Riding It - codelion
http://www.nytimes.com/2012/12/17/business/media/buffeted-by-the-web-but-now-riding-it.html?pagewanted=all&_r=0
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JacobAldridge
Having launched last week on a business model of affiliate and advertising,
this concurs with my research (too soon to say it concurs with my experience).

I do disagree that advertising will only get worse and not be profitable - our
plans assume that that decline will be the case with AdWords, remaindered
banner ads etc, but that the opportunity for good margins will remain when
directly linking advertisers with relevant content and an audience. Again, too
early to speak from experience.

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panacea
Sounds a lot like what Ryan Block did after leaving his Editor-In-Chief post
with Engadget and set up gdgt.com.

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jacques_chester
This exact problem has motivated my major startup project (and the major
project has indirectly motivated the other project).

Basically, here are the major ways to make money:

1\. Advertising.

This sucks and will get worse. The supply of eyeballs grows slowly, the supply
of inventory can grow at an unlimited rate. Thus, rates are always falling.

2\. Merchandise.

Jerky, jittery cashflow. Sucky. Difficult to scale. Hit-driven.

3\. Subscription.

Now you're competing against everyone else with the same idea. You're about to
learn about subscriber fatigue. Plus you're competing with everyone who's yet
to work out that advertising sucks.

4\. "Other"

Affiliate programs pay well but there's a lot of dodginess under the hood.

Micropayments have been tried. Nobody's hit the right model yet.

Naturally I have a dog in the game under "Other". I call it
"microsubscription", as it combines elements of micropayments and
subscriptions. Going on the reference class, I can forecast with some
confidence that I will fail (several others have tried this model or variants
of this model -- Contenture, Readability -- and failed).

What I do have is foolish optimism and a patent pending on a reliable tracking
protocol. I'll be back to announce it ... when it's ready.

