Internet & media, Non-profit & public

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Many online content providers are struggling with their online business model. Nothing new of course. The same goes up for the scientific publishers. In contrast with the news industry where an off-line publication (newspaper) has a rather low price tag, scientific publications are valued at a much higher price. Therefore many of these publications are today locked behind webshops and not accessible to the public. Often the abstract doesn’t give enough information to convince people to buy the full article. DeepDyve tries to offer a solution for that. The scientific search engine now offers the possibility to rent full articles for 24 hours for only $ 0.99. The articles will be accessible online in a not distributable and printable format, at least that is what they are claiming. A part of the revenue will be shared to the scientific publishers.

The business model itself is not that unique. This is again a layered freemium model. Part of the content is accessible for free (abstract/summary) and people can pay to have access to more information. When articles are very long and on top of that complex to read, the 24 hour time frame will probably be not enough for most users. Renting more days or buying the article will often be a better choice. The difference with other micro-payment services is that the small $0.99 teasers are not the only revenue stream for the company. This is only a step-up to convince people to buy full articles. In contrast with news, scientific articles remain valuable over time what makes it more interesting to buy the articles instead of ‘renting’ them.

Internet & media

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The Emoji Dick project is again a good example of how communities can work together to achieve big tasks. In order to translate a copy of Moby Dick, founder Fred Benenson is looking for a crowd to assist him. He may need all the help since he will be translating English into Emoji, a Japanese emoticon language. His working crowd consists out of so called Amazon Mechanical Turks who deliver micro-services in exchange for micro-payments. Some will focus on making multiple translated suggestions of sentences while others will choose the best versions out of them. Other people (the backers) give donations to support the project. In return they will receive one of the exclusive versions of the book, depending on the amount of money they donated. Hopefully this generates enough money to start the project so ambitious Fred can enjoy a small profit as well.

Technology makes it possible that more people than ever are offering basic services that can be delivered worldwide. So instead of contacting a professional company, one may prefer to tap into a crowd of such micro-workers. To lower the risk the Emoji Dick project will only start when enough capital has been raised. Also Quirky, another social start-up we discussed earlier, makes use of these upfront payments. An interesting strategy! More and more start-ups are using such a business model, as a result (software) services that give support to such concepts will become more important in the future. So can we conclude by saying that A bright idea + the right Technology = a Risk-free innovation. Or are these business models to good to be true? What important risks do remain?

Other-industries

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The new start-up Irehab.com tries to take a different approach to health care. Patients can get free advice on how to treat specific complaints. By answering a few questions and looking at several 3D animations, these users should be able to diagnose themselves. To treat for instance ‘back pain’ they can follow step-by-step instruction videos made by physical therapists but personally selected by external doctors to fit the needs of that specific patient. The first 10 consults are free of charge, both for the patient and the doctor. On the platform itself, they will have a private area where they can keep track of the results. After the first 10 consults the doctors will have to pay $0.99 for each patient that they want to follow up in the future. For further advice the patient will have to pay a fixed nominal fee per month directly to the clinic or doctor. On average this fee will be around $9.99. The only money that Irehab.com” receives will be the $0.99 per month, so they will need a large database to make this Freemium concept profitable. Within a few years it will be common practice that people will diagnose and monitor themselves without the hassle of expensive expert consults. Many companies are looking for ways to monetize this evolution. Google Health and Microsoft HealthVault are only a few of the large group IT services that are around these days. But also beyond the normal web experience we see these experimental concepts. Recently Apple presented the Lifescan’s New Diabetes iPhone App that communicates with a seperate glucose monitoring device. The latter works similar as the VirtuaGym concept we presented earlier. There people could monitor their offline exercise habits to benchmark these with other peers online. This D.I.Y. health care market is nearly unexplored so you may expect a boom of new concepts and ideas in the coming year. Many of them will fail but some of them will change the way we look at health care forever.

Banking & professional services

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The business concept of Nexicon is quite exceptional. Their monitoring service tracks down IP’s of illegal content distributors on bittorent and other peer-to-peer networks. I suppose that this service towards copyright owners like movie studies and record labels can be bought with a some form of subscription. Once identified Nexicon’s system will automatically send out a settlement agreement to the ISP who has to forward it to his own client. In such a letter Nexicon threats with legal action if this distributor doesn’t choose to settle within 10 days by paying 10 dollar per illegally shared item. Nexicon will take a commission on each transaction. Although 10 dollar is far less then normally asked in settlement agreements it can generate an reasonable profit for Nexicon if they are able to track down these p2p-users in large amounts.

‘Experiences’ as we use it in our business model framework are characterized by the emotional impact on a user. Contrary to other ‘experience’ sellers Nexicons tries to offer such a negative experience (fear) that will convince a user to pay a small amount of money. An example of the opposite would be a pay-what-you-want restaurant that tries to offer such a pleasant experience in order to receive a reasonable payment from each client. In the end this shows that you as company should take control over the experience of your customer, even when this is a negative one.

Entertainment & tourism

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For years game publishers could rely on the sales of relative expansive game discs to gain their profits. But then together with internet the peer-to-peer networks came up which made it easier for consumers to find cheap alternative solutions to play their most favorite games. After years of fighting against this change in consumers behavior EA now tries to find a new business concept where they could actually make use of this new network possibilities. Buying a disc (or downloading the game) is only a one-time transaction. Once games are connected to the EA server network then extra recurrent micro-transactions are possible. Extra levels, game add-ons or even third party sales could take place inside the game in order to expand the game experience. Possibly this second transaction could become so large that in the end the first transaction would become insignificant. In that case pirated versions of game are just a part of a demo program of a game publisher.

Once you understand that revenue could come from these kind of transactions then you know why Apple for instance doesn’t force old iPhone user to buy new iPhones in order to make use their new software updates. Apple will earn the biggest amount of money with the sales inside the different apps. So when more users have access to the iTunes iPhone store, the more revenue can come in. Then you also know why Apple doesn’t focus on a broad range of iPhones. Nokia on the other hand does and by doing this they still are trying to make their money on the margins of actual cell phone sales like EA did with the actual sales of game discs.

Internet & media

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Get paid to tweet! Yesterday Super Chirp was launched as a tool for twitter users to get paid for their content stream. The application allows twitter users to send direct messages to people who pay to subscribe. Adding new vocabulary, a ‘chirp’ is a direct message sent via twitter to a paying subscriber. Any twitter user can sign up for Super Chirp with his or her existing twitter account (unlike twitpub), and set a monthly price between $0.99 and $9.99. Subscribers pay the small monthly fee for a stream of information. Super Chirp keeps a cut of 30%, leaving 70% for the publisher.

We have touched upon twitter’s monetization before with 77 Ways Twitter Could Make Money. Super Chirp illustrates how 3th party apps are monetizing twitter’s free service by offering paid premiums. Why does twitter refuse to enter the arena? From a user perspective, Super Chirp is another new tool for ‘prosumers’ and organizations to earn money. Think of celebrities (f.e. Britney Spears), stock tips, “the funniest guy on twitter”, horoscopes, charity, authority bloggers, early info… Do you have something unique to sell in small messages?