Edgeio's New Model for Paid Content
Posted by: Rob Hof on August 10, 2007
Edgeio, a site that aggregates classified listings across the Internet, today is introducing a new way for content creators to sell their digital wares—and for publishers to distribute it and take a cut. Although some folks, such as Jeff Jarvis, are not big fans of paid content online, even he thinks the Silicon Valley startup’s “transactional classified” has interesting potential.
Essentially, you’ll be able to view and then immediately buy premium content on a site, whether that’s a research report, a song, a video, or an event ticket, without leaving the site to pay for it. At the same time, other publishers, whether Web sites, Web stores, blogs or whatever, can provide a link to the content and take a cut of resulting sales. So Edgeio’s providing a way to distribute content much more widely than on a single site or store. A rock band, for instance, could enable the sale of an album through fan blogs, and the fans get a cut along the way to sweeten the deal.
Here’s how Edgeio CEO Keith Teare describes it:
We are making it possible for valuable content to be made available for sale on any web site. The web site does not need to have an ecommerce system, or a billing system – edgeio takes care of both. We have two customers for whom we work to make this possible. Firstly a content creator who has paid content that they would like to sell and have distributed. The content creator comes to edgeio and tells us about their content and we give them the means of publishing it. Secondly a publisher, whose main goal is to add revenue to their web site. The publisher comes to edgeio and can choose to become a point of sale for any paid content that they wish to be associated with. Any web site in the world can now become a point of sale for the things they are passionate about.
And here’s how the revenue model works, so far:
Edgeio’s business model is to enable a three-way revenue share. Firstly edgeio itself takes 20% of all transactions. The content creator takes the other 80%. The content creator can choose to enable affiliates to become additional sales points for the content and can define how its 80% is split with an affiliate. In that case their content always appears with a “Resell this Item” link, allowing affiliates to sign up as additional points of sale.
As Jarvis notes, though, the most interesting part may be less the payment system than the new distribution system, a potentially viral way to get content out there well beyond the confines of a single Web site or store.