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List of Web Business Models

346 pointsby pessimismalmost 11 years ago

21 comments

jabelkalmost 11 years ago
I was hoping for more fleshed-out examples of why the business models were good, but the list was interesting nonetheless.<p>My two personal-favorite business models are (in no particular order): Tesla and Miley Cyrus.<p>Tesla: evident if you&#x27;re familiar with it (<a href="http://www.teslamotors.com/blog/secret-tesla-motors-master-plan-just-between-you-and-me" rel="nofollow">http:&#x2F;&#x2F;www.teslamotors.com&#x2F;blog&#x2F;secret-tesla-motors-master-p...</a>)<p>My interest in the Miley Cyrus model might need a little more explanation. Back a few months ago, when she was releasing over-the-top videos (wrecking ball?), <i>everyone</i> was saying some variant of &quot;wow why is Miley famous she obviously has no talent and this is just lewd.&quot; But this is the crux of her brilliance.[0] She has tricked a very large number of people into advertising for her, regardless of whether she does anything requiring talent. But then there&#x27;s the obvious tradeoff: she has to deliver all of these ridiculous things, likely to the detriment of her ability to contribute anything actually meaningful to the industry. Maybe other people have made that deal but none seem to have been as successful, at least based on the data from my facebook feed. And this is a rare case in which facebook feed data <i>is</i> a useful measure of the success of the business, because it fuels the clicks and the conversations and the weird interest.<p>Anyway. Every time I see something about her, even overwhelmingly negative, I shake my head and think &quot;another person tricked into feeding her success&quot;. Her willingness to decouple her success from anything &quot;worthwhile&quot;[1] about her (talent&#x2F;skill&#x2F;beauty&#x2F;benefit to fans), at the cost of irrecoverably changing her career in what most would view as a very negative way, is sort of fascinating.<p>[0] I say &quot;her brilliance&quot; but in reality I am sure she is just the face for a manager type orchestrating the money-and-fame-for-girl&#x27;s-reputation-and-soul deal.<p>[1] &quot;Worthwhile&quot; in quotes because is anything in the pop music industry really worthwhile?
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babarockalmost 11 years ago
One thing worth mentioning for games is what Valve is doing with Dota 2.<p>The game is truly free to play, and giving them all the money in the world will not give the player any in-game advantage. On the surface, the game sells various hero skins and other cosmetic items that are little more than vanity items. Looking closer, it seems that Valve is making (or at least trying to make) money by developing a scene of professional gamers around this game. Just last weekend they held an international competition (conveniently named [The International](<a href="http://www.dota2.com/international/overview/" rel="nofollow">http:&#x2F;&#x2F;www.dota2.com&#x2F;international&#x2F;overview&#x2F;</a>) ) where the prize pool exceeded 10 million USD. This pool was partly funded by the community of viewers paying to watch the pros play their games. I paid my ticket 7.5€ (10$) a third of which went directly to the prize pool.<p>I don&#x27;t know if this model is viable or profitable. Maybe someone has more info. But it&#x27;s worth looking at. I&#x27;ve always been interested by products that are free to use by the public and make money from the pros using it.
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digitalengineeralmost 11 years ago
I came here thinking I would see detailed Busines models. I might be biased as I&#x27;m working with the Business Model Canvas right now. If you&#x27;re looking for a way to build your own here&#x27;s a link: <a href="http://www.businessmodelgeneration.com/canvas" rel="nofollow">http:&#x2F;&#x2F;www.businessmodelgeneration.com&#x2F;canvas</a><p>Edit: UX optimized BMC: <a href="http://grasshopperherder.com/business-model-canvas-for-user-experience/" rel="nofollow">http:&#x2F;&#x2F;grasshopperherder.com&#x2F;business-model-canvas-for-user-...</a>
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fidotronalmost 11 years ago
I&#x27;m very happy to see this at the top this morning.<p>HN has tended to prioritise product development at the expense of business development, when the reality is you need both. Many of us seem to come from that product dev background and like to stick to the &quot;if you build it they will come&quot; mentality, which isn&#x27;t so hot in practice. A lot of modern business models (especially those like ARM&#x27;s licensing or Google&#x27;s sublimely evil auctions) deserve respect from the hacker community for being almost as innovative as the products being sold in them.<p>Finally, I kind of wonder if the promotion by 37 signals has introduced a sort of conservatism that doesn&#x27;t really work. Their true success came from the then radical idea of software as a service, and while I admire the way they cut through a lot of start up bullshit their approach seems to destroy ambition in a way that, for example, YC doesn&#x27;t seem to.
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jonnathansonalmost 11 years ago
This is a fantastic list, and it is extremely helpful to have everything in one place. The next step, IMO, is for folks like us in the HN community to put a little more meat on the bone. Annotate or link to this list with specifics for each model.<p>I might quibble, on a very minor level, with calling these &quot;business models.&quot; More accurately, they are revenue sources. One could argue that this is a small distinction, but there is a real difference. A revenue source is necessary, but not sufficient, for the operation of a healthy business. Plenty of other things go into the mix, even leaving aside the obvious (product): COGS, logistics, competitive differentiators, etc. There is so much more to the success of Uber, for example, than just the &quot;excess-capacity market&quot; revenue model. All of what Uber does with its drivers on the back end, for instance, is quite sophisticated -- and equally responsible for the company&#x27;s success as its top-line, nominal model.<p>Further annotation -- and I&#x27;m happy to get my hands dirty and contribute -- will also help us flesh out the pros and cons of some of these models. &quot;Pay-what-you-want,&quot; for instance, lists Radiohead as the example. That&#x27;s fine. But what a lot of folks don&#x27;t realize is that Radiohead made approximately 80% of its money from the &quot;In Rainbows&quot; album release by selling collector&#x27;s edition box sets for $81 a pop. In that case, pay-what-you-want served as a loss leader and demand driver, and the collector&#x27;s sets earned the real money. Either of these tactics, without the other, would not have worked as well. The combination of the two was a stroke of genius -- allowing the band&#x27;s customers to segment themselves, and in effect, adding an ultra-premium tier to the top of the &quot;pay what you want&quot; curve. The operative lesson of Radiohead&#x27;s experiment was that pay-what-you-want <i>can</i> be effective, but you need to structure the pay scale to account for your customer segments&#x27; different willingness to pay for different versions of the same product. Give them suggestions, at both the low end and the high end of the product&#x2F;price spectrum. If you don&#x27;t, you&#x27;re anchoring everyone towards the low end. And that leaves a lot of money on the table. This lesson has carried over to sites like Kickstarter, to great effect. (I have no idea if Kickstarter took any inspiration from Radiohead&#x27;s experiment; this is just a thematic observation.)
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1337bizalmost 11 years ago
I feel a bit like being on hn for too long - but are these actual business models or just forms of revenue streams? I would argue for the second because business seem quite often to have not just one of those revenue streams in place.
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applecorealmost 11 years ago
Here&#x27;s another list of software business models, comprised mostly of smaller companies, e.g., SaaS.<p><a href="https://github.com/cjbarber/ToolsOfTheTrade#hn-tools-of-the-trade-2014-edition" rel="nofollow">https:&#x2F;&#x2F;github.com&#x2F;cjbarber&#x2F;ToolsOfTheTrade#hn-tools-of-the-...</a>
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kristofferdkalmost 11 years ago
Great link! Thanks for sharing :)<p>Related, I really enjoy St. Gallen&#x27;s 55 business model patterns <a href="http://www.im.ethz.ch/education/HS13/MIS13/Business_Model_Navigator.pdf" rel="nofollow">http:&#x2F;&#x2F;www.im.ethz.ch&#x2F;education&#x2F;HS13&#x2F;MIS13&#x2F;Business_Model_Na...</a> (starting from page 8). Might be inspiration for further development.
GBondalmost 11 years ago
Maybe too unique to include but one of my favorites is FreeConferenceCall.com&#x27;s &quot;provide a free service and get paid by exploiting a loophole&quot; model:<p>Through this service, we generate long distance fees for interexchange carriers who pay a portion of their fees to local networks to compensate for use of their networks. We receive a relatively modest fee from local networks for generating traffic.<p><a href="http://www.freeconference.com/blockingfaq_press.aspx" rel="nofollow">http:&#x2F;&#x2F;www.freeconference.com&#x2F;blockingfaq_press.aspx</a>
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swombatalmost 11 years ago
Missing: all the service-based models?<p>Success fee based, Time &amp; Materials, Fixed Cost, etc...
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pessimismalmost 11 years ago
It’s an old list by now, but I keep updating it; you can also contribute to the original list (<a href="http://news.ycombinator.com/item?id=4924647" rel="nofollow">http:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=4924647</a>) on which this was based.<p>I’m sure you have more great suggestions for what can go on the list; new models keep popping up with companies like Patreon.<p>Feel free to—also—post your suggestions on the Gist. GitHub currently does not support notifications for gists, so don’t get mad if I don’t get back to you. :)
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ztalmost 11 years ago
This isn&#x27;t meant to be a comprehensive list, but it does have some holes I&#x27;d point to primarily in (1) Consulting &#x2F; services, (2) Enterprise, (3) Hardware &#x2F; manufacturing. On the first you have time and materials, fixed fee, etc. On the second you have on-premise solutions, enterprise licenses, etc (Think Oracle, tons of security companies), and the third is, well, I&#x27;m not sure anyone needs examples: you make physical stuff that does something and you sell it.
mrfusionalmost 11 years ago
This has me hoping HN will do another ideas post soon. I got a lot of value from the last one, and I&#x27;ve got five new ideas to share.
johnbenwooalmost 11 years ago
Worth adding Swagbucks (www.swagbucks.com) to the list - they give out rewards points to members for consuming ad-supported content
Kiroalmost 11 years ago
It&#x27;s well-known that adding yourself to link directories are bad for SEO. How is this different?
icebrainingalmost 11 years ago
No crowdfunding? I suppose it could fit in Commission, but it doesn&#x27;t sound quite right.
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lifebeyondfifealmost 11 years ago
IaaS - Amazon Web Services, Microsoft Azure<p>I thought that would be a fairly obvious one.
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snorkelalmost 11 years ago
I especially like the recursive &quot;Service As A Service&quot;
Goladusalmost 11 years ago
How is &quot;site take-over&quot; a business model? (Pandora)
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flibblealmost 11 years ago
I think they missed rake based games - eg. online poker.
source99almost 11 years ago
Where is Amazon?