Hollywood, megavideo and lessons I learned about charging for content online!
I have a popular documentary site which has been around for many years, streaming full length docs for small beer, it pays the hosting costs basically. But what I learned over the years that in order to survive (i.e pay the bills as hosting / streaming content is relatively expensive) is that you have to adopt the Megavideo model, i.e charge for content only after people are addicted to it. They used to force payment after 60 free minutes. I struggled to make any cash with a paywall system and only when I switched to pay in video system did it start making money. Clearly the megavideo model worked as they had 6 million in assets ceased apparently (poor sods).
I built the concept out into a standalone system in Flash and its at karsa.co.uk but for these days it would need to work in html not flash.
I had a nice little company with 30 or so staff, the first employee was a major asset but made a huge mistake when left in charge, ordered 300k of stock in one day from suppliers, then went on holiday and was off sick for some time afterward. The bills wipped out the pre Christmas profits we made and very nearly bankrupted the company. It was a hard slog for a year to get back into the blank, during which time I put him out of the office in final checking and testing. However, after about 8 months of this he landed the bombshell, he was leaving. Despite all pleas for him to stay, (despite his honest blunder he was one of those people you need, would do over and above the call of duty), alas he left. When I replaced him and modernized the management it was less than 16 months later he arrived in my office after I had called him in tears ( I don't cry) explaining the bookkeeper and general manager had scammed me out of over 100k... later I explained why he was 'demoted' I was astonished to realize he was oblivious to the problem he had created, how on earth had I managed to miss that vital information while begging he stay with the company? Being too involved and too busy, along with not trying to have a blame culture is what proceeded those events. My utter shock though at his ignorance to the real problem, and in his boots I guess I would have left too.
I work in both setting up merchant accounts and offer PCI compliance services. Penetratation testing and something called the SAQ WIZARD which makes the SAQ understandable.
The pain involved is high here are some quick tips:
1) most new startups might as well forget about applying. Unless you have prior trading history which you can prove your chargebacks are < 1% then you will most likely get a NO.
2) The business volume should be at least 5K + per month to make if worth your while (and theirs) and figures below this will probably not be worth their while = a NO.
3) Trying to get a good rate is only going to be possible if your a mum a pop store selling shoes etc., anything online will generally be high risk and have fees north of 3.5 %
4) if your transaction value is high > 500$ + then you will be high risk.
5) anything travel = high risk
6) video, gambling, adult, coupons, gift vouchers, warranties, etc are all a general NO.
7) dating = very high charge backs, block every Proxy IP and non UK non USA. Or all markets you are not targeting.
8) PCI compliance is easy if you use the gateways checkout page, However, if you want to incorporate payments direct into your own site, thus using the API (needed for recurring billing or for repeat clients where you don't want to ask for card number again and again) then PCI compliance is a big task, making sure your servers can pass about 3k5 tests and about 400 questions and standards adopted as part of the SAQ (self assessment questionnaire) + you will need to make sure your app is secure from sql injection etc. etc.
It's all about the liability. Ran into the same thing when trying to rent out desks (coworking). Since we're an intermediary we can't bare the full responsibility: the actual things we rent out are outside our control. We were denied because of that.
Luckily most consumers here in The Netherlands don't have credit cards, so not having CC checkout is not a big deal, and businesses are accustomed to paying invoices within x number of days. The number of invoices that get defaulted on is worth the risk.
I've never gotten a really solid response on someone in the know about this, so I'm curious about your thoughts about PCI compliance while using APIs similar to Authorize.NET's direct post method (http://developer.authorize.net/api/dpm/), but I've seen similar setups referred to as postback or other names.
From my developer's perspective using this setup, my application no longer "processes, stores, or transmits" credit card details as the PCI spec reads, so my server/app should be out of scope for PCI compliance, right?
So can html5 continually ping a variable (say a time point) while a video is playing, including other variables back to a third party server (if the video content was embeded via a jsonp wisget etc.) ??
That's the point - it can do whatever you can do, all technical prerequisites are available (threads, background-requests, runtime-dynamic code etc).
Once the proper tools are available providing diverse standard functions, it will spread and be easier for non-developers.
Hixie answered your specific question, but I think you're missing a very important point: "Doesn't every major browser release leave less and less that Flash alone can do?" There are some things (not this one) that Flash can do that browsers aren't yet able to do. The present limitations dictate what you can do today, but they have little relevance to the long-term discussion.
The interesting takeaway I took from this which I loved was his gorilla marketing strategy.
Basically it goes like this, attack your competitors, wind them up in the press as a form of advertising. This creates enormous attention for nothing (people actually read editorial and skip the ads) and often you need an adversary to make something newsworthy.
Be ethical but let the industry know there is battle on and you're fighting for your life, but fight on safe ground!
This is the method I personally used with some success in my former business which was also an electronic hardware, design and manufacturing company. With very little funds for marketing I had to be creative, we made impressive DPS adverts and coupled these with side stories which were often gossip over industry turf wars or other antics I would get up too.
not really as someone who's been in the ring, the same points resonated with me. The experience you are left with is that which will shape your world view and future actions.
I have a popular documentary site which has been around for many years, streaming full length docs for small beer, it pays the hosting costs basically. But what I learned over the years that in order to survive (i.e pay the bills as hosting / streaming content is relatively expensive) is that you have to adopt the Megavideo model, i.e charge for content only after people are addicted to it. They used to force payment after 60 free minutes. I struggled to make any cash with a paywall system and only when I switched to pay in video system did it start making money. Clearly the megavideo model worked as they had 6 million in assets ceased apparently (poor sods).
I built the concept out into a standalone system in Flash and its at karsa.co.uk but for these days it would need to work in html not flash.