Originally Posted by Nathan

This quote is just a placeholder for everyone suggesting mobile/sms billing for this...

At 1.50 customer cost, you are going to pay 50% to affilaites? <G> That's already MORE than you are getting from the providers out of the 1.50!?

The logic is flawed, I am sorry... affiliates will never understand why you are only paying them 50% of .74 if the user paid 1.50...

On top of all of this, anything below $2 (or 1.99 to make it nice) is useless the second it comes from europe, since you will lose another roughly 18% to VAT.

I do disagree with TheDoc and such though, since this is working in europe, maybe not at 1.99 a clip, but it works at a per minute pricing logic very very well.

I think only option though is to pay affiliates around 25% or 50 USD PPS (which is doable if a big enough company does this).

Stocktrader, regarding billing.. you are not understanding I think why billing is so expensive... microbilling never worked before because of TRANSACTION charges, not %age... At $1 the transaction charges alone will account for at LEAST 10%. For most people out there using merchant accounts it is more like 25%. (25 cents flat per transaction). On top of that, the actual %age of around 5% for most people out there, and you already lose 30% ... at $1.99 it will still be 17.5% lost to billing right away.

At a normal growth rate that anyone big will want to achieve, you are likely looking at another 5% because of rolling reserves (after the first 6 months of 10% until the old reserves are being paid back).

So 22.5% for $1.99 or 35% for $1. Nobody out there is going to run this if they have to pay affiliates 50%... I for sure will not... I can buy traffic much much cheaper for this than paying affiliates 50%... paying $50 pps I would see no problem with though... Possibly more after testing for 1 year.

But, never compare this with itunes or such, as someone else mentioned, the difference in size between itunes and any porn site out there is huge. Simply because of age and gender you lose 60-70% possible targets, and the other 30-40% maybe, if we are lucky, half of them would ever surf porn and out of those, 10% will ever buy. So you are at 2% if you are very lucky...

This is reality... does not make your idea horrible, it just makes it very hard to handle... We make very good money with a similar logic in europe though, so it is doable.. and we will move it to the US soon.