maygra: (respect)
[personal profile] maygra
In the post here:

http://community.livejournal.com/lj_2008/3846.html

among all the rest of the news and commentary are three items that have people talking and caught my attention (and that takes some serious doing these days -- I promise you.)

Open questions:
  • Revenue sharing - Should users be rewarded for their content and contributions?

  • Advertising – What are the best ways of integrating commercial opportunities (for both users and brands) into LiveJournal?

  • Subscriptions – Should moderators be able to charge for access to closed communities?




  • The second item, I'm less concerned about because anyone who doesn't think LJ (and other for-profit journaling sites) aren't out to maximize their bottom line, really hasn't been paying attention -- not just to the upheavals at LJ but elsewhere on the webs. Making money off user-generated content is the new economic frontier, and very much like ad placement on "free" broadcast television channels, we've got a few years ahead for business and service providers tossing all kinds of ideas and marketing forays and demographic studies at us while they figure out to make money. In the USA, the taxpayers may own the airwaves, so to speak, but they don't own the content, and the licensing fees the media companies pay to lease those airwaves don't cover the costs of production of content.

    Advertising, however, is indirect profit. The other two items in that list are more direct, and in some ways (to me at least) may appeal to a kind of baseline desire to be paid for what you produce. That in and of itself isn't a bad or good thing; it just is. Whether the currency of exchange is actual cash or swap of goods, or good will and praise, or credit for services yet to rendered, the basic terms and drives of exchange aren't unique to LJ or the web.

    Concerns raised about the other two - Revenue sharing and Subscriptions - aren't actually necessarily issues for the larger userbase of LJ, where original content (as opposed to derivative) might reside. Fannish users hold a different view of the issue, because the stated goals of the OTW aside, the legal issues for fans are still, as far as I can see, still centered around the fair-use qualifier of being "not-for-profit" or not for direct profit. There may be profit of some sort, but by and large no individual directly profits from fanworks, or do so in such a limited fashion as to not be an economic challenge to original content creators (be they media companies, contracted writers, pro authors, or musicians). Yes, there are outliers and individuals who routinely challenge that aspect of the fannish hive-mind that states we "intend no infringement, and make no profit",.

    That said, I don't think the subscription model will fly if only because as so many before have realized, there's little incentive to pay when so much free content -- and free forums -- are available. I think it would require that such comms have significant amount of unique and desirable content and that's difficult to come by or build to the point where people would be willing to pay for a subscription to a locked comm as opposed to going out and creating a similar, free comm elsewhere.

    I think a bigger problem is them floating the idea of paying users for content -- revenue sharing -- which might turn out to be more a de factostatus if they do it and where people -- even those generating content that is possibly infringing might take the money and run without actually thinking about it, the way some archives or fansites take ad revenue. Ostensibly, the revenue pays for the maintenance of the site, but I think there's been posts in the past about how the ad revenue from a site like fanfiction.net may far exceed what could be considered reasonable site costs. It's entirely possible that LJ could, on accounts that are Plus, return revenue to users in the terms of site credits (although ultimately, you'd think it would be self defeating --credit enough to upgrade to a paid account would reduce the ad revenue stream and ostensibly, the site credits.)

    But still, even such a plan (revenue or credit for page views) for a comm like [livejournal.com profile] supernaturalfic or [livejournal.com profile] spnnewsletter or some of the bigger HP sites would put the fannish operators in a dicey situation -- not so much for non-fan comms though.

    It's perfectly reasonable for fans to be concerned with fannish spaces, and to want to protect them, and as with the whole FanLib debacle, to be wary of anyone and everyone who wants to make a profit form fanworks even if they offer to share the profit, but in the larger terms of LJ as a for profit business and despite the credible numbers that showed up on [livejournal.com profile] fandom_counts, and the high number of fannish users who pay for their accounts we're still only a fraction of the revenue that keeps LJ up and running -- how much of a percentage we represent I have no idea, but my admittedly casual assumptions about fan bases, and percentage of paid users versus free (even with Plus accounts) makes me think we are notable but not necessarily a majority of the user base and chances are not even close. I think someone did a break down that people who have paid accounts (as opposed to Plus or Permanent) average about $0.05 a day for usage.

    The current tally at [livejournal.com profile] fandom_counts is 35,114. And that's journals, not necessarily paid journals. The upward count of actual LJ users (from the info page) is at 13 million. Assuming half those journals are paid (and I'm using my own usage as a baseline. I have several journals and comms, both paid and unpaid) that would indicate that conservatively, fans collectively provide $837.00 of revenue a day or $26,000 a month, which is significant but in terms of business, that roughly equivalent to the salary of one not-very-well-paid full-time employee a month. And that is an offset cost, not profit, (and just from subscription fees) . I have no idea what the month to month operating costs for LJ are, but I wouldn't be surprised if it topped a million dollars a month when you take in structural costs (servers, building leases, back up systems, power) and personnel costs (salaries and benefits of paid employees).

    Set that against the other 13 million users and using the same formula, the rest of the use base creates $324,122.00 of revenue a day, even if you cut that to a quarter (assuming fans are more likely to pay for their journals) that's roughly $16000.00 per day or approximately $482000.00 per month. Even a tenth of that is still significantly higher than what identified fans can provide. (and seriously, check my math. I suck at it, but it seems a pretty easy calculation).

    But, wait, you say! There are more fans on LJ than that! With multiple journals! Which may well be true, but the number is up for debate and even if there are upwards of a hundred thousand fannish journals on LJ, all paid, we're still just a single percentage point of the potential revenue stream for LJ the business.

    And I point this out, not to make fannish contributions to LJ look insignificant but to point at that if LJ wants to entice more users to LJ, and not necessarily just fannish ones, revenue sharing and possible comm subscriptions isn't necessarily a bad way to go about it. I still think the subscription model will fall on it's face, but the revenue sharing, even if for site credit? Isn't actually an immediate turn-off for the majority of LJ users. Fans, by necessity, approach it differently -- but recognizing revenue from user-content is the way most sites are trending, and the advertisers are not really waiting to see how much of return they can get before jumping in.

    So, the actual problems for fans is, if everyone (non-fans) are able to recognize revenue or even profit from LJ because of this issue, how do we avoid being pulled in willingly or no. Allowed to opt out? Resist the temptation to pull in a few bucks for the hours we spend creating content and community. I mean, wouldn't it be to cool to actually be able to offset that $19.95 per year fee, and get more features just from doing what we're doing? It's not like we'd actually be making enough to pay rent or mortgage or get more than a couple of cups of coffee at Starbucks. That's not profit, its merely compensation for services rendered. It's a thank you from the service provider for being good customers, right?

    The facts on the ground are this:

    LJ is a business. It's business model is to make revenue and profit from user-generated content. The more users and more content, the bigger their profit margin.
    Fans are only a small percentage of the user-base. Present, Active and Vocal, yes, but still a small percentage.
    Fans, by and large, don't seek to make monetary profit from their work. However, fans are not averse to other kinds of recompense, or necessarily, universally averse to covering their own costs by recompense either monetary or in terms of what they consider an even trade.

    And that last point is where fans may run afoul of their own ideals. How likely it is for LJ to actually go that route is completely unknown, but looking at it from a business perspective, it's not necessarily a bad plan for the future of LJ. It could be potentially bad for fans, but it's not dilemma LJ, as a company should or can resolve for us. It's not LJ that has to decide for us how we approach the "not-for-profit" aspect of fannish behavior. Nor is it actually a point where fandom, collectively, is going to suddenly be in accord and all follow the same route, hold the same views, or come to the same conclusion.

    In case anyone was wondering, I'm not advocating anything. I merely pointing out that railing against LJ for being what it is -- a business -- is a waste of energy. (Which isn't to say, commenting on how they run their business, or how they deal with their users, isn't a separate but related issue. As paying customers, requiring good service is a consumerist obligation as far as I'm concerned, or you know, take your business elsewhere.)

    But seriously, if LJ offered to pay the annual fee for [livejournal.com profile] supernaturalfic, which I'm paying for out of my own pocket as a community service, given my own financial situation at the moment, I'd be tempted.

    Mostly, I find that removing myself from the temptation is usually the better course. I find it slightly ironic that the reason I may finally quit LJ and go elsewhere isn't because of service, but because the potentials is there for them to offer to pay me for doing what I do.



    This post is not f-locked. Link at will.

    Date: 2008-03-20 02:45 pm (UTC)
    brynwulf: (Default)
    From: [personal profile] brynwulf
    You know, I'd be happy to pay the comm subscription fee, right?

    also, [livejournal.com profile] moveablehistory and I are working on a manisfesto outlining the use of Wordpress as a fannish presence and I truly think it might work, but that's just another drop in the large bucket of what is available.

    Date: 2008-03-20 03:11 pm (UTC)
    ext_9649: (not all who wander are found)
    From: [identity profile] traveller.livejournal.com
    if, and it's a big if, but if i felt forced to choose a relocation technique... since i already use wordpress for my site, i'd simply add another subdomain for journaling and voila, i'd be all linked in. so i'm really in support of that, tbh -- it's what i did on mrks lo those many years ago. :)

    Date: 2008-03-20 03:24 pm (UTC)
    brynwulf: (Sam spits)
    From: [personal profile] brynwulf
    Exactly!

    We will certainly need supporters of the idea to help get the word out, as neither of us has a friends base large enough to really matter, so all pimping of the manifesto is greatly appreciated.

    Date: 2008-03-20 03:27 pm (UTC)
    ext_9649: (Default)
    From: [identity profile] traveller.livejournal.com
    if I could have just one thing from WP, it would be the ability to reply directly to comments instead of just adding to the thread.

    let me know when you've got something together, i'll happily take a look/throw up a link.

    Date: 2008-03-20 04:11 pm (UTC)
    From: [identity profile] girlguidejones.livejournal.com
    I feel...uh...semi-strongly...that profiting from our fanworks, even if it would be only to offset a journal fee, negates any disclaimer I could construct. In fact, I would feel dishonest trying to claim not-for-profit in such circumstances. I fervently hope there would be an option to opt out.

    While I agree with you regarding the small sliver of LJ that is fandom, there is a particular factor which I often feel no one who's tied to LJ marketing/business planning has considered.

    Fandom is a large part of what brings YOUNG users to LJ. Of all of the tweeners I know, NONE of them are on LJ. They have Twitter, and MySpace, and FaceBook. And almost all of them have ALL of those. But they don't LJ, and, as it happens, none of them are particularly fannish either.

    I don't think LJ has a lot to offer the 18-24 year old set that they can't get faster, brighter, and with more bells and whistles at FaceBook or MySpace. What it does have is fandom and fanworks, so if you're a twenty-year old in fandom, and want to read HP fic or see Metallicar vids, share Yaoi artwork or view Ronon manips, LJ is (currently) the best place to do that it. Especially if you want to do MORE THAN ONE of those things all in one place, instead of belonging to a Yaoi discussion board here, and checking out SG-1 webrings there.

    I agree that if all of the 35,000 fandom journals left LJ tomorrow it would probably blink a few times and soldier on. But I also feel that an LJ without fandom would suffer from a drastic reduction in the new, younger membership sign-ups that it needs to remain a viable business in the future.

    And nothing I've read convinces me that anyone who has the ability to make policy has considered that possibility.

    Disclaimer: All opinions based on personal, organic theorizing, and not on any actual empirical evidence whatsoever.
    Edited Date: 2008-03-20 04:15 pm (UTC)

    Date: 2008-03-20 04:13 pm (UTC)
    From: [identity profile] dejla.livejournal.com
    You make very good points; I'm going to have to go away and think about this.

    Date: 2008-03-20 04:27 pm (UTC)
    From: [identity profile] onelittlesleep.livejournal.com
    Hi Maygra, I saw this through my flist o'flist, sort of.

    Anyway, I do think you're right, that the statistics seem to imply that fandom is only a very small minority of the 13 million or so user journals that exist, though I wonder at how many of those 13 million journals are even active...

    I also think that fandom has definitely adopted LJ as one of its premiere meeting grounds and we're all loathe to leave it. So fandom doesn't just represent $26,000 dollars a month, it represents a possible LIFETIME of organized, supported use and subscription, which I doubt non-fannish users can promise. And fandom is an ever-growing group of people with funds set out for fannish enterprises and interests, willing (like you) to pay for services to better fandom experience. I just think they'd be massively old-fashioned and foolish to not recognize the economic potential in fandom. Alienating us now not only shows arrogance in business ("who CARES if we lose those 13 thousand crazies!") but real ignorance.

    Date: 2008-03-20 04:52 pm (UTC)
    From: [identity profile] ethrosdemon.livejournal.com
    I have the same inclination that of all the existent ljs a large portion than seems to be the zeitgeist were created by fans--I mean think about sockpuppets and joke journals and coms and just randomosity that fans create and forget about. Over the years, I don't know how many journals I've made, 30? 40? And I'm just one person, and not even a rpger or someone who actively sockpuppets. Idk, this is just a feeling I have about those supposed 13 million journals. Who knows, maybe everyone in Moscow is an active ljer!

    Date: 2008-03-20 05:01 pm (UTC)
    From: [identity profile] onelittlesleep.livejournal.com
    I thought there was a way to see which journals out of the 13 mil. were active. Do you know?

    (and yes! There are kids with handfuls of RP journals. ALSO. 30, Kassie? THAT IS ALOT)

    Date: 2008-03-20 07:00 pm (UTC)
    From: [identity profile] ethrosdemon.livejournal.com
    idk, that might be high, but I think it might not be.

    Date: 2008-03-20 05:11 pm (UTC)
    From: [identity profile] maygra.livejournal.com
    Well, I quartered it down and that 13 million was posted last year sometime. The breakdown is this. A paid account costs $19.95 a year (Or $25 if not auto renew) That's between 5-6 cents a day per paid user. Say that it really is only a fraction of that 13 mil -- 20% outside of fannish journals, that's still $1,420,000 per day of non-fannish revenue. 10% is $71,305.00 per day.

    Versus $837.00 a day? Yeah, they might notice, but at worst they'd have to fire somebody or three.

    i.e. the proposed economic models have potential to actually increase LJ's bottom line, and at the same time, possibly wreak some real havoc within fandom, the same way FanLib could. It's the same case of fans taking all the risks and reaping little profit except as a token.

    I'm not saying it will happen or that LJ doesn't massively overstate their actual active user base (paying or not) -- and in this, I'm only talking about subscription fees for paid journals -- ad revenue is a whole other animal and if they were going to offer profit sharing back to the users, that's where it would be generated from, would be my guess.

    Date: 2008-03-20 05:00 pm (UTC)
    From: [identity profile] maygra.livejournal.com
    I don't disagree that it's a foolish move to alienate even a fraction of their user base. And even if again, only a quarter of that 13 million that isn't fannish are active and paying, they've still got the number on us.

    And quite honestly, them recognizing the economic potential of fandom is what worries me. We might be a hard sell, but I would never say fandom can't be bought given proper incentives (which may or may not include money in our pockets.)

    My concern her isn't what these kind of changes (even if only speculation) Fandom may or may not have a voice in regarding LJ/SUP, but what kind of impact they might have on fandom.

    That lifetime of organization and support are things fandom has done for itself -- LJ was just an accidental beneficiary of our desire to build those communities, in my opion. We were (and are) willing to benefit the infrastructure as long as it benefitted us.

    The reverse is not necessarily true, and I don't think LJ has any problem at all with showing it's arrogance at this point. We are not necessarily their target user base, just as women are not, by and large, the target audience of broadcast television advertising demographics.

    I'm more worried about what holding out this kind of reward system might be more damaging to fandom as a whole than pretending we don't exist.


    Date: 2008-03-20 05:06 pm (UTC)
    From: [identity profile] onelittlesleep.livejournal.com

    I'm more worried about what holding out this kind of reward system might be more damaging to fandom as a whole than pretending we don't exist.


    Yes, true. Honestly, I've been so frustrated with the possible 'censorship' issues to even think about this until reading your post. But you're right. That is definitely a massive issue. I think it's only fair that their company benefits from 'disposable fannish income', which I know others do (conventions, etc), but for FANDOM itself to take advantage of fandom is really reprehensible.

    Date: 2008-03-20 07:46 pm (UTC)
    From: [identity profile] 1trackmind.livejournal.com
    I also think that fandom has definitely adopted LJ as one of its premiere meeting grounds and we're all loathe to leave it. So fandom doesn't just represent $26,000 dollars a month, it represents a possible LIFETIME of organized, supported use and subscription, which I doubt non-fannish users can promise.

    I disagree. I think LJ is a stepping stone to something else. Just like usenet, Bulletin Boards, and e-mail groups were stepping stones to LJ. I think it's become increasingly clear that we're all just waiting for the next big thing. We're here because our friends are here, not because LJ itself is inherently better than IJ, GJ, etc.

    Date: 2008-03-20 04:46 pm (UTC)
    From: [identity profile] ethrosdemon.livejournal.com
    Oh, god, paying people? Rly? This is going to be the New Thing That Ate Fandom. SIGH. Lj, could you just stfu and gdiaf already?

    Date: 2008-03-20 05:14 pm (UTC)
    From: [identity profile] maygra.livejournal.com
    It's a discussion point - it hasn't actually happened and for non-fannish user-generators it would probably be a pretty good deal.

    For fans? Not so much, I'm thinking.

    Date: 2008-03-20 05:49 pm (UTC)
    amalthia: (Default)
    From: [personal profile] amalthia
    This whole thing sounds like a slippery slope that I really hope fandom avoids. (though won't lie it's tempting)

    but I think for me I felt alarmed at the idea of having to pay to join communities. It's bad enough with people flocking their journals so you can't even read their stories but this just doesn't sit right with me.

    Date: 2008-03-20 06:06 pm (UTC)
    From: [identity profile] maygra.livejournal.com

    My guess that it would be an opt in and for fannish comms, I'm not sure that would actually come into play (i.e.: again, why pay for what you can get for free elsewhere. Some people might float it but I think it wuld likely not be worth their while at some point.)

    On one hand it could be seen as a 'zine mentality -- but the reason I think it wouldn't actually fly fannishly is more because if fans have to pay for service, they tend to be demanding about the level. We don't get into so many intra-fannish rows about entitlement for nothing. *g*

    Date: 2008-03-20 07:38 pm (UTC)
    From: [identity profile] 1trackmind.livejournal.com
    I think it's a bad idea. I think that while people acknowledge LJ is a business and want to see it succeed, they don't like being reminded that it's a business.

    More than that, I think there are some taxation issues. I assume if they pay you you'll be an independent contractor, not an employee of LJ. I also assume they won't do any withholding so you'll have to figure that out on your own. It wouldn't be terribly difficult because I doubt we're talking much money here, but the annoyance of having to figure it out may outweigh the small amount you'd get. I suspect the rules may be even more confusing for those who live in a state with an income tax. I don't, so I don't have a point of reference for that.

    But more than that, I think if they start letting communities charge fees while there will be some who gladly pay the cost there are a lot of people who feel like they're being nickel and dimed since I'm quite sure that the moderator(s) won't receive 100% of the fee. And if it doesn't work out, the people who paid only to have the community return to being free might be upset. It starts to feel exclusionary in a way that just f-locking doesn't.

    Right now the extras you get as a paid member seem like benefits, not a punishment for not being a paid member. But start charging for communities and I think that changes.

    Date: 2008-03-20 11:03 pm (UTC)
    ext_2451: (Default)
    From: [identity profile] aukestrel.livejournal.com
    You raise an interesting point I hadn't thought of in terms of fandom as a community in itself.

    Fandom runs along fairly free wheeling lines; whether they are anarchic lines or socialist is probably up to the individual to define. I have noticed in my time in fandom that people have contributed generously, financially especially, to those who do not have the means to get a website, or a paid LJ, or even to go to a con. In short, it seems to me, at least, that fandom as a community is used to a communal economic model rather than a capitalist model.

    There's an interesting parallel to the other community with which I am involved to a significant degree: the Sims 2 custom content creation community. There are people in the community who charge for the custom content they create, and there are people in the community who decry them for charging (for various reasons, ranging from the fact that charging seems to violate EA's license agreement to the fact that many players are teenagers who may not have access to funds). The debate in this community crystallised how I feel about charging for content, whether it's fannish or Sims 2: I feel it violates the spirit of the community. Thus I subscribe to the Sims 2's largest free content site. It's not very much, but it helps defray their costs, and they do not require anyone to ever pay any money to use their site or download their content (so no one is excluded on the basis of ability to pay).

    This is REALLY very important to me, I discovered.

    Since I can afford $5/month, I contribute that because of the service the site provides to the community as a whole. That was initially the reason I joined LJ as a paid user: I could care less about a dedicated URL or 50 fucking icons. I don't use the icons I have. I subscribed because I felt they were doing a service to the fandom community. I would hate to see anyone excluded from the community because of race, colour, gender... or ability to pay. When I don't renew my paid account, it will be because I don't consider LJ to be providing a service to the fandom community, not because I don't think LJ isn't a business or doesn't deserve to make money.

    Wow, thanks for listening. Didn't mean to go on so long.

    Date: 2008-03-23 06:36 am (UTC)
    From: [identity profile] 1trackmind.livejournal.com
    The debate in this community crystallised how I feel about charging for content, whether it's fannish or Sims 2: I feel it violates the spirit of the community.

    Yeah. I was really sad when my favorite Sims skinners decided to go pay. I haven't been able to get into Sims 2 to the same extent I was into the original Sims, though I will say I've liked the pared down Sims Stories. While I miss being able to add content, the fact that it takes only a few minutes to load rather than 10+ is a trade off I'm willing to make.

    Did you see Sims 3 is due out in 2009 (http://www.gamedaily.com/games/the-sims-3/pc/game-news/the-sims-3-coming-to-your-neighborhood)?

    I subscribed because I felt they were doing a service to the fandom community. I would hate to see anyone excluded from the community because of race, colour, gender... or ability to pay. When I don't renew my paid account, it will be because I don't consider LJ to be providing a service to the fandom community, not because I don't think LJ isn't a business or doesn't deserve to make money.

    Exactly. Becoming more exclusive is a move in the wrong direction and that's likely to drive me away even faster than poor communication with management.

    Date: 2008-03-20 10:53 pm (UTC)
    ext_2451: (wounded)
    From: [identity profile] aukestrel.livejournal.com
    The reason the idea of revenue sharing alarms me is because - look at who would be implementing.

    That's right. LJ.

    Revenue sharing would end up giving them yet another tool to exercise more power and control over LJ users, particularly fandom, and yet it would bind more users to LJ, and possibly lead to issues such as, oh, incest-type fanfic comms being charged "more" or receiving "less" revenue and then if the moderator decides to move elsewhere, possibly being told, "sorry, that's our content, we paid you for it, you can't post it on IJ."

    Given what we've seen of LJ's customer relations abilities, this does not seem to be an unreasonable fear. Sadly.

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