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Ask HN : A different Business Model

2 points by bo_Olean ↗ HN
I personally do not favor Apple's way of making cash. (When most of your users won't pay for your service you are dead. I don't want to charge users for the service or may be my users are not in such a sophistication to pay online.)

Also, I am not big fan of Google's way of not being evil in advertisements for making cash. When a conscious internet user realizes that you are being tracked everywhere from your website to email to preferences for your favorite videos - the conclusion could be Google Sucks!

My concern is can we live without ads and users paying for your online service ? Are there any other business models except these two for a web startup ? Could you please share anything that you ever counted as a business model for web product?

5 comments

[ 3.2 ms ] story [ 23.7 ms ] thread
japhyr
What about the Red Hat model? People wondered how Linux would ever make money because it was open source. Then Red Hat was founded on providing support around open source software. If a service is useful to organizations, rather than just individuals, some kind of support contract might be profitable.
rch
I've been wondering why open source projects seem to avoid the co-op business structure... imagine if Mozilla regularly distributed some of those google dollars to the entire pool of code contributors. Maybe there are not many serious external source contributions now (though there may well be), but that equation could change in a hurry if there was a meaningful disbursement involved.
pedalpete
Apple has multiple ways of making cash, which one are you referring to specifically? They make cash on hardware, services (warranties), and distribution of media and apps.

It seems to me you are asking, how do I make money from end-users without charging them for my product and not selling advertising.

I know nothing about your business, so it is difficult to say what the possible business models are. You're clearly going to have to think outside the box. Take a look at what secondary information you get from the usage of your service.

For a business I am currently looking at, the actions of the user result in a small yet valuable piece of data for other businesses. The data is not in any way 'user specific', and would actually be less valuable if it were tied to a single user, but I'm considering analyzing the data I get and then selling that analysis to other businesses. Of course you have to be VERY careful with this sort of business model, as you don't want to offend your customers buy sharing any info that they may not want shared. For my industry, it isn't a concern.

However, I would take a good look at what you are offering, who else is in the space, how they make money, and question why you don't want to charge.

A big initial fear I am still learning to get over is the fear that people won't pay, and that means the business is not successful. If app stores, netflix, e-books, etc.etc. have taught us anything, it's that people will pay for what they are able to get for free. People pay for apps, even though the app provides the same info as can be seen on the companies webpage.

My recommendation (and the reason I say this is because I have in the past struggled with the same challenge of wanting products to be free) is to spend time looking at what people do pay for. Talk to other businesses about how customers react to their pricing and business model.

We've were introduced to a 'free-web' where we thought everything to consumers could be free, but it turns out that may have been a bit of a utopian dream, and people really don't mind paying for things.

bo_Olean
Yes, I was asking about how do I make money from end-users without charging them for my product and not selling advertising (in context of a web startup)

analyzing the data we get from users and then selling that analysis to other businesses - this models seems nice. Also, as japhyr suggested charging for the support would be good idea too.

Any other ways out here ?

ianhowlett
Why don't you just find something that people will pay for, and charge for it? If nobody will pay for whatever you're offering, maybe that's a sign.