The Money Shot! or That vid is MONEY!

By Ivan Gevirtz

created: Thursday, May 25, 2006
updated: Monday, January 07, 2008

Community Media

My son AJ has been taking Tae Kwon Do for almost a year now.  He started taking it at a private academy through an introductory class offered by the township.  Since then, he has been taking classes 3-4 times a week, and I've been considering putting out a bumper sticker: "My son and my money go to Tae Kwon Do".

AJ has shown his dedication at the two competitions he has attended.  After the first, as a white belt, he came home with a bronze medal.  And after the second, he came home with a huge first place trophy, inspiring another sticker: "My son and my money are good at Tae Kwon Do"

On the morning of each of the competitions, one of his sisters has wound up being sick, and I've had to stay home and play doctor.  As a result, I have never actually seen him compete: "My son kicks butt when I'm not looking".  Boy would I have loved to see him in action.  But now, and forever, I've missed the opportunity to see his face when he won his first TKD trophy.

Clique can fix this.  Why doesn't the owner of the TKD academy broadcast the competitions, so every parent with a sick child can see?  Why doesn't he sell DVD's of the competition so the children can relive their glory days?  Because it's hard and annoying and expensive and stuff.  I would have loved it if they set up CVP so I could watch the competition from home, in real time.  In fact, I would even pay money for this!  Now, traditional pay per view focuses on very valuable media (Hollywood on demand, or one time exclusive events) with a mass audience.  But with the web, we can make this technology available to the masses.

What if the TKD master set up Clique, and could earn $5 for everyone who watched the competition in real time?  What if he could also get $0.50 every time someone pulled up the clip to show to friends and family.  What if I could pay him $5 and be allowed to post AJ's trophy winning kicks on my family website?  "Check out what my money can do --"

What if every soccer mom who captured her kids game had the opportunity to not only archive her footage, but also to earn a little side cash (to pay for the tape and the gas) for it?  What if some soccer dads edited the games down into highlight clips (for their personal collection), but allowed everyone in the school to see it, and got paid for his efforts?

What if I wanted to know, today, which was the best: river to fish, trail to hike, or bar to patronize, and could see videos, from today, of the areas under consideration?  What if it cost me $2.50, but saved me $10 in cover fees or gas money to get this time-relevant information?

The way to get around the problem of the network effect is to shrink the community to a size where you can get some level of saturation.  AJ's TKD master would not find a wide audience for his videos.  But if he could make them available to all his current (or even potential!) students, he can reach that small subset who would be willing to pay for them, or who would bring him other value.

Small Media

One of my favorite businesses is Getty Images, in the artsy Fremont neighborhood of Seattle.  They're headquartered on a beautiful river right by a cool little drawbridge.  On the other side of that bridge are the boat houses featured in Sleepless in Seattle.  What I like about them, aside from their uber-cool digs, is -- and I don't know how to put this any other way -- their business basically prints money.  Last year they had over $500 million in gross profit on revenue of $750 million.  They have about 1800 employees, meaning they gross almost a half million dollars per employee.  Microsoft beats Getty's ratio, but they have over 35 times more people.  Getty's a lean, mean, money machine.  And what's most amazing is that they don't sell anything real!  Getty sells people the right to use images they own.  They sell to newspapers, magazines, publishers, graphic design firms, and the like.  Now, Getty's images are generally of high quality; They compete with the Bettman archives(owned by Gate's Corbis), which are commonly lithographed into high resolution "coffee table" books.

I see another market for images which is below Getty's reach.  Websites don't require high quality graphics.  Rather, they need small images.  These days, even corporate websites often just copy images from their competitors sites because they don't have a way to get their own images.  And, news websites often just scale down and crop expensive images for their websites, making for a less rich experience.  News sites could post low resolution images that were even more relevant than their high res ones, captured by the onlookers camera phones before the real reporters arrived.  And these news sites would provide a unique and enriching experience, distinct from their print or broadcast cousins.  If the images or videos were particularly interesting, as in the case of the grainy video of Rodney King, or the tourist videos from 9/11, they could even make it to the higher "quality" mediums.  And if the people who captured this valuable content were paid to do so, they would be motivated to capture and publicize their work.

Vlog Crazy

I have identified three models for users to make money.  The first two are the Pay Per View and the licensed content models.  This model is appropriate for corporate and media outlets to buy amateur generated content.  It may be possible to find compelling content in specific small communities that consumers would pay for.  However, it has been proven that consumers will generally not pay for content.  However, in this case we still want to pay content generators for their valuable content.  The way to do this on the Internet is via an advertising model.  This would basically be a revenue-share program where the content generator would get paid a portion of the advertising revenue their content generates.  These ads could be prepended trailers to the media itself, could be banners on the page -- such as VlogCrazy -- which embeds the content, or could be in a special area on the Clique media player itself.  This model also supports allowing other sites to show the content, as long as they also show the associated ads.  These sites would thus continue to generate revenue for Clique (the aggregator and provider of the media) and the original content generator.  This model is similar to Revver.