What does the "Media Business Model" mean?

Fred Wilson says: 

Most web apps will be monetized with some kind of media model. Don't think banner ads when I say that. Think of all the various ways that an audience that is paying attention to your service can be paid for by companies and people who want some of that attention.

This is the core of FREE, at least as it exists online. Both media and most online businesses are based on "software economics", where the cost of creating something of value is relatively high but the marginal cost of distributing it to each consumer is very low. So you can look at the web as the ultimate extension of the media business model to a wide range of other industries. 

But when people think of the "media business model", they usually just think of advertising. That's a big part of it, to be sure, but as those of us in the media business know, it goes far beyond that. 

Here's my start at a list all the revenue models you can find in the media industry, all based around a core of free or almost-free content:

• CPM ads ("cost per thousand views"; banner ads online and regular ads in print, TV and radio)
• CPC ads ("cost per click"; think Google ads)
• CPT ads ("cost per transaction"; you pay only if the customer brought to you from a media sites becomes a paying customer. Here's an example.)
• Lead generation (you pay for qualified names of potential customers)
• Subscription revenues
• Affiliate revenues (think: Amazon Associates)
• Rental of subscriber lists
• Sale of information (selling data about users--aggregate/statistical or individual--to third parties)
• Licensing of brand (people pay to use a media brand as implied endorsement)
• Licensing of content (syndication)
• Getting the users to create something of value for free and applying any of the above to monetize it. (Like Digg or our own Reddit)

UPDATE: Michael Cader suggests a few more good ones (some of which are exhibited in his own Publishers Marketplace)

• Upgraded service/content (ed: aka "freemium")
• Alternate output (pdf; print/print-on-demand; customized Shared Book style; etc.)
• Custom services/feeds
• Live events
• "Souvenirs"/"Merchandise"
• Co-branded spinoff

UPDATE2: Fred Wilson adds: (see his comments section for even more)

• Cost Per Install (popular with top Facebook apps who can help others get installs)
• E-commerce (selling stuff directly on your website)
• Sponsorships (ads of some sort that are sold based on time, not on the number of impressions)
• Listings (paying a time based amount to list something like a job or real estate on your website)
• Paid Inclusion (a form of CPC advertising where an advertiser pays to be included in a search result)
• Streaming Audio Advertising (like radio advertising delivered in the audio stream after a certain amount of audio content has been delivered)
• Streaming Video Advertising (like streaming audio but in video)
• API Fees (charging third parties to access your API)

Finally, one of my commenters gave this example, which speaks to how much more diverse the media business model is than people think:

"My main business is a site that sells classified advertisements. I can make money from any of 4 sources:
- The people placing the advertisements, or
- The people paying to see the advertisements (in my niche market, this is possible, although in most advertising markets it isn't), or
- Commission from sales for related products, or
- Direct sales of related products"

What other revenue models am I missing? Additions and other suggestion in the comments, please, and I'll update this list accordingly.

(image: GapingVoid)

Comments

[برامج]

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[xocai]

Brian and Sarah McCoy offers home based business by selling or marketing xocai products.

[Extenze]

This list of media models for monetizing online media illustrates the wide range of possibilities driving digital abundance from a commercial standpoint.

[cheap flights to chennai]

The point is, give the content away, make it compelling and the ad revenue will come. We have seen a drastic increase in advertising revenue in the past six months.

[Mesothelio]

They are micro economies where trade, commerce and personal interaction are all intermingled with each other. Think of Second Life and their booming economy.

[Monavie]

Thank you for this wonderful, There probably is a seperate set of models underlying the commercial and personal drives to create free software and extend digital abundance.

[detox body]

Thanks for listening. It would be instructive to develop a similar list of why people create media works where they are not concerned about the commercial potential.

[bath and body]

Thanks for the info. This will illuminate the strong commercial, institutional and personal driving forces that are working to create digital abundance on the web.

[coimbatore flights]

Really useful list, thanks very much for spending the time to put it together.

[Joshua Russak]

Before CPT, I have included CPA ads ("cost per action" where you pay only if the customer brought to you from a media sites performs a certain action.)

[Ram]

thank you all for the exhaustive lists. I think i was impressed by economies of communities and tipping as two new ideas. Another revenue stream that i think will gain currency will be ad revenue share with power users of the net. Then screen - reals estate to be sold for media companies like TV screen - 15% on right and bottom sold out to sponsors etc.,

Also all these millions of websites can become local store fronts focusing on their likes/strengths/audience profile at the same time be loosely associated with others for seamless transfers if reqd.

One more revenue model could be like google ad words - domain specific sites can be profiling /research sites for companies to understand and market- our sites are like MRI scans a lot of times.

we are also webaholhics searching for our string revenue streams but these suggestions from all of you kinda inspired me!!!

[Ari Lestariono]

Like yourblog, but I was looking for new business model for my health blogs as to attract visitors and monetize it including educational and tutorial, if someone can pull me an articles about this I appreciated very much

[Jeff Paul Internet Millions]

My friend and I have started our own small website and internet marketing the site to attract some visitors to buy products from our clients. This can really help make good money.

[Jeff Paul Internet Millions]

My friend and I have started our own small website and internet marketing the site to attract some visitors to buy products from our clients. This can really help make good money.

[cashback]

nice read, good bog!

[kabin]

thanks...
Kabin
Konteyner

[Internet Marketing Tools]

It's becoming more difficult to separate ads from content these days. One can hardly visit any major news source without being forced to view an advertisement before viewing the content. It seems the over the air broadcast model is working its way online. Media outlets are continuing to funnel customers to there websites and then force feeding the ads.

[Seo blogas]

This would be similar to clicking through to Amazon affiliate books, except that they keep all of the revenue from the sale. The free content then leads to paid-for content.

[accessoires xbox 360]

When for-profit publicly-held media companies don't produce high profit margins -- it may be time for media to pursue a nonprofit business model. Thank you so much for sharing this type of interesting information with us..