Economics of a Website??

[WALKER]

I question how a website like this generates revenue. The owner isn't charging a membership
fee and so is all revenue a result of advertising fees?

I'm sure there are expenses to hosting a website. Are those a $100 a month, $500 a month, or
$1000 monthly.

Reason I ask is on another website the trolls always inferred that they were important as
"generated traffic." Why is that important?

Educate me a little you computer gurus

[Jsb]

I don't know about a site like this where more traffic need to be considered but I have created low traffic websites for less than $20/month which includes hosting and the url.

[WALKER]

Thanks for the reply Jsb

$20 a month is reasonable as covering $250-$300 a year in expenses seems like a possible
breakeven. I wouldn't think even a small business would complain about a $250 charge for
advertising space.

I was guessing the hosting costs of maintaining a website were much more.

[shnelson]

Jsb is spot on when it comes to smaller sites & minimal traffic. You can get a godaddy account for about $5 a month and that's usually plenty for most websites, add in the domain (url) for about $15 a year and you're in business!

Cost will increase significantly when performance, availability and content delivery are critical - but luckily it's all scalable.

Example - this site; I start with my $10 domain name (per year), put it on a dedicated server with sufficient resources for 25-50 concurrent users ($10-30/month - but in my case it's subjective to whatever I have laying around/idle), and add performance as the demand on resources increases. More resource = more cost.

Additionally, I have a certain allocation of bandwidth per month, determined by my service provider. That allocation is equal to about 500,000 individual page loads (a page load is every time a user opens a single page on the site). When users exceed that amount, I just pay for another chunk of bandwidth. Each additional 500k page loads will cost me about $25/month.

Finally, there can be significant cost associated with technical support resources - basically administrative staff available 24/7 to maintain and support your hosted website or server. The more you need these guys and their services, the more they'll charge .

Just a few years ago, endeavors such as this were far more costly - three or four times more. Advancements in server virtualization have made it much more reasonable, and as we move forward we are getting more performance for less $$$. I'm ok with that!


The primary source of income I have seen for most community or discussion sites is ad space. Website owners earn money either by users clicking on the ads (I've seen anywhere from $0.50 to $1 per ad click) or number of impressions (usually only pennies per one thousand impressions, an impression is any time someone just views an ad on their screen - no interaction with it).

I might have rambled on a bit too much here, hopefully that gives you the perspective you were looking for!

[h2ofwlr]

If say a person was to start from scratch, buy a computer/server, etc, and the associated software, that is where it can indeed cost a chunk of $$$$ for start up costs + the learning curve too (your time is worth something--right?). But when you have a guy like Shawn and others that have many clients, those costs are shared, and so more reasonable. And once the knowledge is learned you can apply it to 100 accounts Vs a do it your selfer operation.

I remember about 6-7 years ago, a HSUS ad kept coming up over at DHC and guys complained. Well Chris Hustad (the owner) basically said want to stick them good? Click that ad as I get $ if you do, implying he wanted to bleed them of their financial resources. Moral of the story--you had better know who your target audience is and exactly where they are.

[WALKER]

The primary source of income I have seen for most community or discussion sites is ad space. Website owners earn money either by users clicking on the ads (I've seen anywhere from $0.50 to $1 per ad click) or number of impressions (usually only pennies per one thousand impressions, an impression is any time someone just views an ad on their screen - no interaction with it).

I might have rambled on a bit too much here, hopefully that gives you the perspective you were looking for!

Thanks for the education Nelson.

Sooo if I understand you everytime we see an ad we should click on it as that will generate
revenue & keep this website operating. Have I got that right?

[shnelson]

Thanks for the education Nelson.

Sooo if I understand you everytime we see an ad we should click on it as that will generate
revenue & keep this website operating. Have I got that right?

No problem!

Currently, there are no ads here... And I'm not totally sure how I feel about them to be honest. Part of me hates the way they clutter up good content, but while it is relatively low cost to run this joint, there's still a cost.

If I found a way to cover my out of pocket expenses without molesting you guys with john deere and chevy truck ads, I think we would have a happy medium and this place could continue on forever.

[Bill Gilbertson]

Here is how my son initially monetized his site:

Donate.PNG (4.23 KiB) Viewed 6943 times

Currently, the button gets you to fundraise.com. I know he used PayPal at one time.

Now he also has advertising.
The back story is interesting (to me at least as his Dad).
In Jr High and High School, he was a computer geek. The best investment I ever made was to supply him with whatever computer stuff he thought he needed.
He started a forum, Unicyclist.com.
While a senior in High School, he attended Century College. He needed a car to get there, so I said I'd buy him a $4,000 car. He wanted an $8,000 car, so I lent him the extra money to be paid back from his income after he graduated from college. Fast forward to college graduation, and I was really disturbed that he was not interviewing or applying for jobs. After graduation I told him I expected him to start making payments on the balance I had lent him. He goes up to his room and returns with a check for the full amount. I was baffled, I knew he wasn't selling drugs.
It turns out that the forum software had problems displaying long URLs that spanned lines. So he developed a service the allowed a short URL to replace a long URL in text. This was earning him an income while in college. More than 10 years later, TinyURL is still providing him a decent income. He has 2 employees. I suspect he spends most of his day dealing with inappropriate use.

[shnelson]

Bill, that's awesome... I use tinyurl from time to time and never knew its origin to be here. Great example of finding a solution to a problem, vs the reverse that the rest of us (or just me) tend to do instead.

[WALKER]

Great story Bill

I'm way to old to understand terms like URL but I still appreciate the story.

I'm the guy that didn't grow up with computers & asks his grandkids to fix his computer. This
computer stuff all seems like magic to me. I do appreciate the patience shown by guys
like shnelson who take the time to explain computer geek stuff to me. I'm sure they are thinkin
"How does that old fool even operate a computer"

BTW I'm willing to make a "donation" to help with computer start up costs. Give me an address or
way to send money. Also got a new C&S call you can have for a giveaway