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by rwbhn 1721 days ago
> need to start charging for the core product

I think you've misunderstood what their core product is. They charge good money to their customers - companies placing ads.

2 comments

Seems like there's roughly four revenue streams. Some companies dip into all of them!

* Sell you a physical product

* Sell you a service

* Sell information about you: your conversations, your clicks, your friends, etc

* Sell you ads

Smart TV's are an example of all four at once.

What about digital products? I guess you left that out for a reason, what would that be?
A variant of #1 or, usually, #2: most of the time when you "buy" a digital good, you're really renting it out under extremely limiting terms.
I got your point, it's valid, specially membership sites. But some stuff is different. Ebooks, audio files.
It's still correct regarding ebooks and audio files, you're not paying for the files but the rights to keep a copy of the file and use it personally.

If the files are not protected by DRM, then there's no technical limitation on copying or redistributing the file, but according to your license agreement you're not permitted to do so.

In practice, no one is probably going to come after you for copying your music files or ebooks across your devices or sharing it with friends, but you don't own the file. Try mass distributing it or reselling it long enough and you'll attract someone's attention.

Which ebooks and audio files? Two mainstream providers - Amazon (Kindle) and Spotify - both rent out access, not sell actual ebooks.
I bought a lot such files on various web pages. I am not sure what your question is. Good point re Kindle/Spotify.
I think you misunderstood the point.

If it becomes possible for users to access the product without also driving ad revenue, they will soon discover that the service they offer to users is just as much a part of the core product you describe as the ad platform. Without eyeballs, ads are worthless.

Then there are two choices:

1. make people pay for that service directly (i.e. acknowledge as a product, separate from the ad business); or

2. make the part of the product with ads good enough and palatable enough thast users keep visiting.