Where Do You Feel We Stand On Program Closures?
 

A large number of programs have either gone under or shut their program to affiliates and affiliate payments on past sales, in the last 6 months.

Where do you think we set now? Have we seen the worst of it? Halfway there? Haven't even seen the tip of tip of the iceberg?

No need to name names or trash any individual programs. Just curious about what others think will happen over the next 6-18 months.

More programs will sell out for pennies on the dollar to the 3 guys buying everything up and those 3-4 companies will have 95% of adult's traffic :2 cents:

Wary of PPS programs so only adding pure revshare proggys now for at least the next 12 months. It takes a special breed of idiot to screw up a revshare program.

I always laugh with these doomsday prophecies

It's just capitalism at work, there will always be new programs rising and old ones falling and plenty for webmasters to choose from.

Thus why I said 95% and not 100% :)

That's not saying those small new sites/programs cannot be successful; they definitely can.

I am saying the reality is, many programs have taken huge hits and are trying to cash out right now, and there are a few parties very interested in scooping them up (and have been doing so for the past 2-3 years).

I'm not sure I get what is Doomsday about that ? I prefer to call it reality.

It depends on the services they are rendering.

For example, a Rev Share program on a video chat site is expensive. On LiveCamNetwork.com for example, the girls get 50% and the biller gets 15%, leaving only 35% for the site. Affiliates won't pay attention to any program for much less than 25%, leaving only 10% for the site owner. How is he expected to pay for programmers, support staff, bandwidth etc?

Rev share is good on a membership site because the ongoing costs are much less.

A video chat site on the other hand can do better with Pay Per Sign-up. A site owner can offer 50% Pay Per sign up if he is marketing the right girls because even though he will lose or make $0.00 on the initial sale, the gamble is that the right girl will Hook that customer into becoming a long-term client.

More programs going under, conversions as a whole increasing, these are fairly certain. Affiliate programs that remain will tighten restrictions more. Some will try things like 40% revshare instead of 50% and will find mixed success. One major third party processor might go down such as Verotel, ccbill, or epoch and cause a firestorm. I'm not suggesting any of these in particular only that it wouldn't surprise me statistically speaking. Government pressure is still also very likely on the industry and may cause more people to leave the industry yet. US webmasters will have it worst with this last aspect unfortunately. :2 cents:

Sounds kind of plausible, but I think we're seeing a shake-out instead. As I mentioned in another thread, we closed our own affiliate program 4 months ago for a number of reasons, but have just quietly re-opened it. We've cut costs by keeping it easy to maintain and offering fair payouts.

Not going anywhere

It seems you are either very intelligent in mapping out this game based on the series of events, OR, you have been talking to some of the people who are working behind the curtain right now. Within the next 12 months, they will own the vast majority of the online adult traffic properties.

Either way, spot on.
:thumbsup

Consolidation is one direction.

The other direction is microniching and selling the EXPERIENCE not the content per se. Example: http://models.lifestyleamateurs.com/...php?page=model

The old model of using adult content for rebills/cross sales will probably go by the wayside once more finance industry-related reforms kick in. This will probably light a fire under many site owners to focus on quality, retention, affordability, and niche loyalty. Affiliate programs might evolve towards real long term partnerships as opposed to quick PPS payouts.

Just my :2 cents:

Visa chargeback ratio dropping to 1.5% will knock out a whack of programs.

The worst is yet to come.

True dat.

In 13 years of running pay sites, from celebrity to fetish and with different processors, I have never gotten over a half of a percent in charge backs in all that time.

you might not be but your bank accounts surely are.
:2 cents:

i dont think the number is as high as 95% but your spot on about the consolidation of the programs in this industry

very true

programs will either close out right as they have been doing and try and keep their rebills or sell their assets to the highest bidder

the worst has yet to be seen. :2 cents:

maybe a little exaggerated on the figures, but yes, that's more or less what will happen. Wait... it's already happening! :Oh crap

More programs and/or sites will close. We've only seen the tip of the iceberg. Reasons are simple and been already partly pointed out and they will effect all the models. Only the fittest and canniest will survive.

Reasons are simple. The cost of driving traffic is too high for today. Be it Rev share or PPS. Not only is it what goes to the affiliates, it's things like tools, support (how many people are moaning they don't get 24/7 support? In todays market it's not profitable.) promotion, etc. Then there's programs, staff, offices, expenses, content and more. Many are fixed costs and can't be cut on. Great in 2005 and will put some out of business in 2010 and beyond.

You can blame Tubes, free content, economy, summer, solar eclipses, etc. But the real reason is paysites have refused to meet customers needs first. So the customer ain't playing the game today.

Some will survive, small operations serving niches and mega ones buying everything else up. Affiliates in the long run will be the worse hit. Why will the industry need so many with so few sponsors to promote? The remaining few sponsors will soon figure that out.