It's possible that you might see some changes at some of the oldest game sites on the web. Games Domain Review, Happy Puppy, and Computer Games Online (associated with Computer Games Magazine) are all owned by theglobe.com. They also own Chips and Bits.

Not only is the theglobe.com's stock price underwater right now, trading at close on Friday at $0.56 a share, but a planned sale of Games Domain Review and Console Domain Review fell through. This was going to give theglobe.com a $5 Mil cash injection. Now that the sale is off, theglobe.com has sent Charles Gray, the former editor of Happy Puppy, over to the UK to evaluate the situation. From a story at MSN's Business Wire:

"Additionally, theglobe.com is has already taken steps to significantly reduce the Properties' operating expenses, including headcount reductions, and is aggressively exploring other cost-cutting opportunities including the possibility of relocating part or all of these operations to the U.S. to achieve cost synergies among theglobe.com's other five leading games properties."

What will happen? Of course we can only speculate. Our guess is that the Games Domain properties will be consolidated with Happy Puppy as theglobe.com continues to look for a buyer. They do have a market capitalization of $17.46 Mil, but their expenses seem to be exceeding their revenue based on their last quarterly report filed on November 14, 2000:

"We have incurred net losses in each quarter since our inception and we expect that we will continue to incur net losses for the foreseeable future. We had net losses of approximately $65.8 million for the nine months ended September 30, 2000 and $49.6 million, $16.0 million, $3.6 million and $0.8 million for the years ended December 31, 1999, 1998, 1997 and 1996, respectively. As of September 30, 2000, we had an accumulated deficit of approximately $135.8 million."

Not exactly a cheery pattern there, is it? Unfortunately (especially for us!) websites are a bit of a dime a dozen commodity these days since the advertising market has collapsed � one of the leading advertise brokers, Doubleclick, has issued a statement that they anticipate that the market will remain flat or decline further for the rest of the year. This means that 2001 looks to be even a worse year than 2000, during which theglobe.com lost a bundle. We hope that the struggles of theglobe.com don't affect Computer Games Magazine.

What do you think? Is this further evidence of the collapse of the gaming website scene, or is this just an unusual situation? Will Computer Games Magazine end up being hurt by this?

"We have incurred net losses in each quarter since our inception and we expect that we will continue to incur net losses for the foreseeable future."
"Doubleclick, has issued a statement that they anticipate that the market will remain flat or decline further for the rest of the year."

So theglobe.com lost progressively more and more money, even during the good times. I suppose that means they never found a profitable business model, but just kept scaling up the losing model (a common .com problem). They admit that they don't see a time when they will be profitable. Now that the market has turned soft, I can't imagine them pulling out of that spin. All hands, brace for impact! Abandon ship!

I like CGM editorially, but their business practices managed to piss me off to the point I refuse to subscribe (I have broadband, I don't want the stinking CD cluttering my house. Don't penalize my content for that choice!). I'd hate to lose another gaming magazine, but if someone has to go on the chopping block, my sense of vengeance is happy it is them.

"So theglobe.com lost progressively more and more money, even during the good times. I suppose that means they never found a profitable business model, but just kept scaling up the losing model (a common .com problem)."

Yeah, I think that's it. They do have Chips and Bits and CGM, which are non-dot com businesses. I don't see much hope for theglobe.com to survive. The real question is what will happen to the websites and the magazine? I could see someone buying theglobe.com for a song (and hopefully changing the name!) and then breaking up the company and selling it piecemeal. The websites could be folded into a larger online company, such as AOL or USA TODAY.com, that was looking for content. The magazine could be bought by a traditional magazine publisher.

Chips and Bits -- I wonder how they are doing? They were one of the few places where you could order games online, but now there are a legion of competing businesses. One of the problems with the Internet is that there isn't a lot of customer loyalty. You may have purchased your last 5 games from Chips and Bits, but then you see that Compuexpert has lower prices, so you switch.

It's pretty gloomy when you see big places like NBCi shedding workers. People are just having a real hard time making content sites profitable. I think the ad market will never fully recover. The ads were overpriced and in many ways this is just a correction. Case in point: I was chatting with a friend who talked to someone at one of the leading game companies. The game companies are delighted to see ad banner prices come down, finally. This guy claimed that previously, for the price of running an ad banner on a busy site for just a couple of days they could purchase a foldout ad in a magazine like Penthouse. There is no way that a teensy ad banner running for a few days is as good as a foldout ad in a national magazine. That's nuts.

And finally, about CGM, I agree about their weird subscription practices. They really need to make the nice, fat issue available without the CD also. I can't remember the last time I used a magazine CD.

I had a subcription to CGM before they did the "bonus edition" crap.I paid for a full magazine not a cut-down one.

When I called to complain,they were snotty and arrogant.So I canceled the remainder of the 2 year sub(about 1 1/4 of a year left).Never got my money back.

So they can go to hell for all I care.

-Monkeybutt

So far they've only made one spot on fuckedcompany.com. A couple is the norm before it's all over nowadays :).

Interesting quote from their board
"
first of all who ever thought there was a business model there. Second, has anyone seen any, I repeat any evidence that this company would succeed? The founders were lucky and walked away with alot of money but the reality is that the employees aren't as lucky and now it is only a matter of time before the company folds. There is no core to this company
"

Marcus

"I had a subcription to CGM before they did the "bonus edition" crap. I paid for a full magazine not a cut-down one."

Yep, same thing happened to me. Halfway through my subscription, they decided that I wasn't paying enough to get all of the magazine content & demanded $1 an issue to upgrade. I got the same response you did, as well. I even quit shopping at Chips & Bits after that.

"Halfway through my subscription, they decided that I wasn't paying enough to get all of the magazine content & demanded $1 an issue to upgrade. I got the same response you did, as well. I even quit shopping at Chips & Bits after that."

Yeah, that was a boneheaded marketing move. They should have taken all paid subscriptions and upgraded them at no cost, and *thereafter* had the two kinds of subscriptions available.

Worse, they rubbed your nose in it. The slimfast version came with a table of contents that listed all the articles you weren't getting! It was pretty unbelievable.

The editorial staff had nothing to do with it, so don't hold it against them.

Just to clarify things, the only people getting the thinner edition are those who get it for free via various deals. There is no way to pay for a subscription without getting the large edition. People who receive the magazine without the CD receive the exact same issue as those who do receive the CD, and this has been true for the last couple of years. All paid subscriptions were automatically upgraded to the full edition almost two years ago; there was initial resistance to this from our previous management, but they are no longer with the publication.

There were regretful glitches in the auto upgrades and we ended up with a lot of angry people. Anyone that contacted our subscription department was upgraded, though.

As for anyone that had problems with the upgrades and/or customer service, there's not much to say beyond offering apologies. Due to problems with our clearing house, we recently had to switch to another. Any magazine will tell you that clearing houses have incredibly poor customer service records; we do our best to handle as many issues internally as possible. Directly calling or contacting the magazine would likely have resolved the problems.

Steve/CGM

CGO, Happy Puppy and Chips & Bits doesn't mean
much to me, but I really hope Games Domain doesn't
get into some corporate hell.

"Just to clarify things, the only people getting the thinner edition are those who get it for free via various deals. There is no way to pay for a subscription without getting the large edition. "

Not exactly. I had subscribed to OGR Magazine, and when it folded, my subscription was converted to CGM. I paid for two years of that magazine, and ended up with the incomplete edition of CGM. I insanely hold grudges against entities, so I'll never go back. Another example: my one speeding ticket in my life was in a radar trap in Idaho in 1990. I've never been back since then, and when I was thinking of incorporating a company for myself a couple years ago, I included a clause in the bylaws that the company would not do business with the State of Idaho, or any of its political subdivisions. Fuckers.

What is it with the CDs, anyway? I feel like they are always being jammed down my throat. I get PCGamer and CGW without the CD, but it seems like every renewal thing they send me only offers the CD version. I have heard that the demos are treated like ads, with the companies paying to have their demos included, so that would explain it if true.

Good question about the CDs. I have no idea, but since there's limited space on each CD, perhaps some companies do pay to get their demos included.

I write for a couple of the mags, including CGM, but the newstand prices are getting out of hand. $8 for a magazine with a CD in it is way too expensive. I almost never buy from the newstand anymore, which means I rarely get PC Gamer. My subscription to CGW ran out last month so I didn't get that one either. I'm down to the slimfasted CGM.

I enjoy them, but I don't get $8 worth of pleasure out of them.

The CGM change over helped me. I now get a full edition with CD and a slim edition. How or why I don't know.

"I write for a couple of the mags, including CGM, but the newstand prices are getting out of hand. $8 for a magazine with a CD in it is way too expensive. I almost never buy from the newstand anymore, which means I rarely get PC Gamer."

I also wonder if there are any real numbers to explain the huge disparity between the subscription price & newstand price? It gets worse, though. I just reupped my sub to MaximumPC (also Imagine media) for $12/year without the CD, and cover price with the CD is $7.99. Tax makes that $8.63, which means a blistering $103.56 annually from the newstand (but you get the CD!), versus $12 subscription price without the CD.

"I now get a full edition with CD and a slim edition. How or why I don't know."

They give away the slim edition right and left. If you buy a game from Chips and Bits I think you get a free sub, so maybe that happened?

I could live without happypuppy but I would miss both CDMAG and GDR. Two of the best online publications available, it's a pity they have to be dependant of that "TheGlobe" thing.

Marcus

I don't hold the editorial staff responsible,but I'm like Supertanker,when somebody screws me out of my money it will be a cold day in Hell before they get anymore of my money.That goes for the Chips and Bits store too.

-Monkeybutt

"I could live without happypuppy but I would miss both CDMAG and GDR."

I suspect CDMAG is relatively safe, since they're affliated with the magazine, which I presume is profitable. Even if theglobe.com collapses, I'd suspect someone would purchase the assets. The things that weren't making money would be shut down, but the parts that were making a profit would be continued.

Happy Puppy may be doing ok too. They have some kind of syndication agreement with USA Today.com, so they may have a revenue stream beyond advertising.

GDR seems a bit dicier. It looks like theglobe.com is going to at least look at how they can shave expenses with GDR.

The bottom line is that any business that relies on Internet advertising revenue is going to feel some serious hurt this year.

Mark, What is your take then on free servers such as geocities, homestead, and hypermart? Do you think these will soon fall? I just set up my .com on hypermart and all they ask is an ad be placed on the top of the page. I don't have the money for even cheap commerical web server. Also do you have any advice to give someone starting a gaming news page? I'm not looking at making any money from my venture nor being massively sucessful. Just doing it as a hobby after all.

I don't know about the free servers. You can check their stock prices if they're publicly held.

There are still people buying ads on webpages, so it's not as if there's no money being spent. The rates have fallen dramatically, though. I have no idea what these places need to do to be successful, however. Just keep your site backed up on a local drive in case your free server goes offline.

As to advice, Tom and I are rookies at this too. You'll get the most traffic when you can put up an article and get the news portal sites (Blues, VE, etc.) to link to it.

You can also look for an angle. That was Rich's best move -- doing a site devoted to telling us when games have gone gold.

Doing it for a hobby is your best move, considering the current website market. :)

I just checked Geocities. It looks like they're owned by Yahoo now, so they're probably a safe bet. Yahoo is one of the strongest of the Internet companies.

I would rather avoid geocities and I imagine most of anyone who might want to read my page would like to avoid geocities as well. I'm happy with hypermart, I just hope they keep it up. :)

Any ideas on how best to approach game developers to do interviews or get game screen shots? My page is focused on tactical strategy and god games and its very helpful that Talonsoft, Firaxis, and Microprose are all with 15 minutes of where I live. I also know people that work at all three so I imagine they will be quite accessible. However how would someone get in contact with a company like Maxis or Bullfrog and not sound like a 14 year old get with a web page? I�m a 31 year old with a web page. Big difference I know ;)

Getting screenshots, if you mean exclusives, isn't all that easy. Tom and I ask for them and we are often turned down. A lot of it depends on how many screens the publisher wants to release and how busy the developer is.

If you just want to reuse offical website screenshots, I think you can just grab them and note where they came from. I doubt anyone will give you trouble.

As to approaching game companies for interviews, I'd just tell them who you are and hope for the best. One of the problems you're going to run into is that a rule of thumb many of the publishers have now is that they look at your site and if you're not running ads, they may not deal with you. If you can leverage any kind of association you have with Gone Gold, that might help.

Just to quickly explain how things go here, and chime in with my $.02:

The magazine and website are like siamese twins you couldn't seperate without resulting in two hideous, malformed drooling dweebs. Much of the edit staff and a good deal of the content is shared between the two--though the magazine has its art staff and the web it's HTML person and whatnot, and the each publication definitely has plenty of content exclusive from the other.

As for profitability, well, I'm just an editor so I don't know the whole picture with the rest of theglobe.com or the entities it owns. I'm also not at liberty to disclose our financial numbers. I'll say this, though: The magazine/website was profitable last quarter. Yes, as in, NOT "will be profitable sometime in the future" but as in "already IS profitable." Which isn't to say we won't have quarters where we're not--ad revenue is seasonal in this business.

It's not really possible to seperate the website's profitability from the magazine's. They share too much of the operating expenses due to staff overlap, and ad sales are sometimes packaged deals for web and print (as I understand it--I'm not an ad guy, and want no part of that business so long as I'm on the edit side).

On cancelling the sale of gamesdomain - Reading between the lines of the in-house announcement, it seemed TO ME that the situation is more like this: after announcing the sale, theglobe realized that they could get more for gamesdomain. Maybe they got offers from other potential buyers? I dunno. It seems like someone may have said "oh, I'll pay you more than THAT if you can lower operating expenses" or something. This is pure speculation--I have no idea. But it doesn't look like the situation is as grim as "they couldn't sell gamesdomain."

On theglobe.com's troubles: yup, they're bleeding money, like every other .com (and like just about every publisher with a major games publication for that matter). They've got a specific plan to break even by the end of the year, and go profitable after that. In the past 3-6 months, a LOT of costs have been cut, and now the trick is to bring in more revenue. From ZDNet:
http://www.zdii.com/industry_list.asp?mode=news&doc_id=ZE507039

Anyway, should theglobe.com go under, I really don't know what would happen to us. The whole "Computer Games" division has books and branding that seems to me like it would be valuable for someone else to pick up. But I'm not a businessman, I'm a hardware gaming dork.

Disclaimer--this was all just my personal opinion, and certainly not the opinion of theglobe.com at large, necessarily.

Jason @ CGM/CGOnline

"Anyway, should theglobe.com go under, I really don't know what would happen to us. The whole "Computer Games" division has books and branding that seems to me like it would be valuable for someone else to pick up. But I'm not a businessman, I'm a hardware gaming dork."

Yeah, I would think CGM/CGO would be a profitable asset that someone would want. You guys have really done the best job of establishing a synergy between print and web.

I'm pretty pessismistic about any web business that is centered around ad revenue at this point. Some of the other assets of theglobe.com don't look so promising.

" I'm pretty pessismistic about any web business that is centered around ad revenue at this point. Some of the other assets of theglobe.com don't look so promising. "

I mostly agree, with one caveat: some web businesses have learned how to manage their operating costs quite well and can survive, or even thrive. I hear that Cnet does quite well because it has a relatively small staff and owns enough of it's servers and connections that hosting and bandwidth costs don't kill it.

Take Happy Puppy for example. All other aspects of that site notwithstanding, there's no way in hell that the cost of hosting all the downloads it does is worth it. The traffic, ad revenue, or whatever other way it makes money by people going to download demos there isn't nearly what the bandwidth costs are for serving them up. My guess is that they're either going to have to do something different with downloads or scrap them altogether to start turning a profit.

Jason @ CGM/CGOnline

Demo downloads might actually be something that people would be willing to make a micropayment for. I wouldn't pay a lot, but I'd probably be willing to pay $0.25 to download a demo.

I have no idea how well CNET does, but I know that the CPMs for ads that they and ZDNet used to ask for and get are hard to come by these days. I think at one time they could get a $20 CPM (or higher - I've heard $50 CPM but I find that hard to believe), but I'd be surprised if they're even getting a $10 CPM now by the time you factor in unsold ad inventory.

So, what I'm saying is that their business model in part was based on a higher ad rate than they're likely to get this year and possibly ever again. I expect that even CNET will have to make some big adjustments. Their stock price is at $16.25, which is pretty low compared to their 52 week high of $75.

What the gaming sites need that they don't get is advertising from the game companies. It's pretty hard for any focused site to make it if it doesn't get ad dollars from the market niche it serves. You're putting a big burden on them to start.

The niche sites are probably doomed. Even at a $4 CPM (and there's no way in HELL a focused site could possibly demand that), there just aren't enough relevant ads. Their possible target ad radius is too small.

Steve had a good idea a few weeks ago where focused and portal game sites could do like so many porn sites do: develop a one-fee access network and share in the revenue. Like the Adultpass and stuff--pay $10 a month for access to these 1,400 gaming sites. Pay $15 for a "Gold" membership which each site would use for access to special, more costly items. Like maybe downloadable movie clips, demos, downloadable .pdf versions of game guides, etc.

That might be a way to get gamers to stomach paying for access while getting away from the pure advertising model.

Jason @ CGM/CGOnline

The CGM/CGO situation seems a little twisted to me. It wasn't so long ago that print publications were scrambling to set up an online presence, kind of a "keeping up with the Joneses" if you will. Having a website was essential if you wanted to be a leading content provider, and now it looks as if the situation has reversed itself.

I think people are finally waking up to the idea that the current system of ad-based revenue is not going to be sufficient to carry the web economy forward. I'm only comforted by the idea that my favorite sites were founded based upon content instead of commercial intent (e.g. quartertothree), and therefore stand some chance of escaping the economic pressures.

- Alan

Heh -- well, we certainly don't have a lot of money invested in this site -- it's been time but not money.

The ones that are going to have problems are the ones with a good-sized staff and fairly expensive hosting costs. I'd guess that from this time last year to this year they've seen their ad rates drop by at least two-thirds, if not more, and they may have trouble selling as much of their ad inventory. No one wants to invest in them anymore because the business model right now is so shaky. UGO got a $10M investment, but they had to slash payouts by two-thirds and I'd wager they gave up a significant share of the company also.

A lot of sites started out as fansites, like Blues News, so they may be able to weather this downturn and hold on until the market improves, if it will improve. You tell me how long a site like Blue's can last after seeing its revenues cut by two-thirds, though?

I just checked Blue's and the ad banner they're running is for IWIN, part of the Uproar network. I have to wonder just how long advertisers like these will last? Uproar is trading at $1.56 a share, down from a 52-week high of $35. They have great traffic but they're still losing money because no one's figured out how to convert traffic into profits, at least in the current market.

So you've got this situation where ad rates are down and you have a lot of the advertisers who are other online networks that are in trouble. Not a good combination if you're projecting forward. I don't think we'll see an upturn until you see more traditional businesses advertising on the web. Maybe with the depressed rates some will take advantage of that.

"Steve had a good idea a few weeks ago where focused and portal game sites could do like so many porn sites do: develop a one-fee access network and share in the revenue. Like the Adultpass and stuff--pay $10 a month for access to these 1,400 gaming sites. Pay $15 for a "Gold" membership which each site would use for access to special, more costly items. Like maybe downloadable movie clips, demos, downloadable .pdf versions of game guides, etc."

I don't know about anyone else, but I would pay for that. In the back of my mind, I always figured the free content would come to an end. I just can't justify paying $4 per site per month like combatsim wants. If a minor monthly fee and more ads (even, God help me, popups) are the ticket to keeping my bookmarks intact, bring it on.

Now, which is more embarassing for an adult to have on their credit card bill: a porn network or a gaming network? ;)

"I don't know about anyone else, but I would pay for that. In the back of my mind, I always figured the free content would come to an end. I just can't justify paying $4 per site per month like combatsim wants. If a minor monthly fee and more ads (even, God help me, popups) are the ticket to keeping my bookmarks intact, bring it on."

We may see this at some point, but I think we're at least a couple of years away from it. It may have to be coupled with some kind of matching service like Gamespy provides to add more perceived value.

Kali sold pretty well. That was a one-time $20 fee. They might have done better to charge $2 per month for their software and bundle in a network of gaming sites as well.

We'll probably always have some free sites, though, and they'll draw away traffic from pay sites. Too many people do this as a hobby and also like doing the HTML as a hobby. They may not be able to make much for their pageviews, but if they can cover their expenses they're happy.

Mark you make us hobbyist sound like we are going a bad thing. Lets be honest, out side of Computer Games not one of the paper mags have produced a sucessful web site either. Next Gen did ok for awhile but that dried up and blew away.

I don't mean to make the hobbyist sites sound like a bad thing. I'm just discussing the economics of the situation. Forget the term "hobbyist" and replace it with "free information" and maybe that it's a bit more palatable.

So far as I know, only the porn sites and the Wall Stree Journal have been successful in charging for content. When you can get information for free instead of paying for it, most people will choose free, thereby making it hard for a fee-based site to survive.

Comic-geek reference that has a bit of relevance here.

Anyhow, online comics, like anything else, are experiencing a crunch when it comes to actually making money via this fancy new "Internet." Scott McCloud, best known for "Understanding Comics", has an interesting column about a way to pay for content that differs from the fixed-fee subscription-based system, and the goofy ad-revenue-based system.

Warning: column is in comic-form. Be prepared to read pictures and word balloons together. The point is still there, though.

http://www.thecomicreader.com/html/icst/icst-5/icst-5.html

-Thierry

One point that Scott McCloud misses is that people are already paying for the net. Warehouse clubs excluded its hard to convince people to pay for the right just to buy something else.

Rob has a very good point. A lot of people consider their $20 a month (or more, if you use DSL or Cable) as paying for the content. It's like the old days when Cable TV was first introduced. People were used to paying their $400 for a Television and then getting their ABC, NBC, CBS, and public access networks all for free. Then along comes this new thing called Cable TV that says "Yes, we know you paid for your television set, but now we want you to pay us $20 a month plus another $4 a month for every premium channel you want to watch". People went nuts. Pay for television? It's free!

Now cable TV is a staple of the entertainment industry. They offer targetted programming (like Animal Planet or ESPN) and the premium channels go so far as to be commercial free.

If people can wrap their minds around the thought that the $20 a month for internet access is like paying for your cable box every month, then I think the industry can survive. It makes the internet a service that gives you basic news and information along with some public access stuff. However, if you want the exclusive interviews, the demos, the custom made UT levels, you need to pay an additional fee. Having that fee in a package format (like $15 a month for the entire UGO network) would be like paying $15 for the HBO and Cinemax package. It makes it feel much more palitable than paying $4 a month for each individual site/channel.

Followup to what I posted:

McCloud has voiced the micropayment idea before, elsewhere. A lot of comments I've heard in these other circles, express the sentiment: "It's a great idea, but banks want to deal with dollars, not cents."

-Thierry

I wonder if it would be viable to have a credit system. You send a site, say, $20 and you then use that $20 up over the course of the next month or two. $.25 for a demo, $.10 for each custom map, etc... When you run out of credit, you send them another check. This reduces the problem of having banks having to cash 25 cent checks, and it gives the sites the money upfront where they can toss it in the bank to pay the bills and maybe make a little interest on it (assuming enough people buy credit).

The problem with micropayments is the same problem that a fee-based site will have -- why pay for something when you can get something similar elsewhere for free?

Yes, a micropayment reduces the barrier in one way since a $0.25 payment is easier to take than a $3 monthly subscription, but if I'm surfing the web and every third site is asking me for a quarter, I'm going to start to shut them all out and just go to the free sites.

I think the best chance is for fee-based networks to arise. Then you could mix in modest subscription fees that would be split up among the sites that comprise the network, and they could still run banner ads for some advertising revenue.

I'm dubious about that, even, for sites that are content sites. What exactly are you going to give me that will make me pay a couple of dollars a month, especially if there's similar content on the web for free? Like Rob said, I'm already paying for net access -- in my case $40 per month for DSL. That's a lot.

www.paypal.com seems like a pretty reasonable, working-in-practice and successful implementation of a framework that could be used for micropayments.

Yeah, paypal could work. What do they get out of the transaction? I used them to buy a game via eBay once. Seemed pretty reliable.

"So far as I know, only the porn sites and the Wall Stree Journal have been successful in charging for content. When you can get information for free instead of paying for it, most people will choose free, thereby making it hard for a fee-based site to survive."

....since no one else mentioned it yet: Why not combine gaming sites *with* porn? I'd bet the number of visitors would just skyrocket. :)

Ugh!! I don't like that idea at all! Plus, the video game market is very teen-oriented. And, if you start integrating porn with video games, what's next? No, some lines shouldn't be crossed frivilously, or frequently.

Paypal is just about the best suggestion I've heard yet. Especially if there was some way for them -- or someone else -- to manage the micropayments. You set up an account with paypal, every time you need a download, you give them a quarter. Once a week (month, whatever) they send full payments (dollars, not cents) to the respective companies, and keep take five percent (or whatever.) So, they make a little, we don't feel like we're paying large amounts, and websites don't have to deal with all the quarters. Sounds like a win/win/win situation to me!

It's still true that there's no way people are going to pay for something they can get for free. The only way it would work is for a network to get exclusive commitments from game companies. For example, lets say the Gamecenter Alliance (pulling the plug on Feb 1st, but we'll still use the name) signed an agreement with Interplay that all demos would be released to Gamecenter Alliance sites 1 week before they are released to any other sites. This would still allow Interplay to get its demo out into the real world, but anyone who wants it NOW needs to pay $.25 or whatever. You'd still have problems with people giving copies to their friends or posting them on Usenets.

I don't think pay-per-article sites will ever really be able to get off the ground. Lets take the Sega thing for example; if, say, BluesNews was charging $.10 to read the Sega Dreamcast rumors, everyone would just go to SegaNews or CNN or whatever. You need to be able to give someone something that they can't get anywhere else, and that's going to be a real challenge on the net

"You need to be able to give someone something that they can't get anywhere else, and that's going to be a real challenge on the net"

Yep. That's the challenge. No matter how good the editorial might be at Computer Game Center Spot Online, rather than pay a couple of bucks per month to read it (or even $0.25 for a weekend's access) I can go to Joe's Game Site and read a review or preview or see those new screen shots, or if Joe's doesn't have it, I check out Jim's site, or Tim's site, or....

Plus, there would be people pirating the content from Computer Game Center Spot Online if it was a fee site.

A setup like the recently defunct Barrysworld or Gamespy, where they run game servers or game matching might be worth a couple of bucks per month for people. In fact I read that Barrysworld had a micropayments system they were about to put in, Barrybucks. I'm not sure enough people would pay for matching.

Hate to tell ya this Mark but the big sites have no problem pirating from the hobby sites. My Might & Magic page got worked over no less than three times. (That I know of) Probably what happens is someone has a deadline and if the reporter steals from a hobby site, no one cares since the hobbyist doesn't have the money to sue.

Rob Merritt -- http://www.moonbasetycho.com

What do you mean got "worked over"? Did someone actually lift your text?

You should contact the editor if this happens. Chances are he or she doesn't know and is in fact paying money for an original article. Really, don't keep your mouth shut. Some site stole a couple of my reviews and reprinted them almost word for word without my name on them and someone else's name. I contacted the editor and they were promptly taken down.

The three incidents were...
1. A major game site (One you worked for I believe) Took all the FAQs I wrote and put them up with someone elses name and their copyright information. That took near six months to straighten out.
2. A certain planetblahblah linked screen shots directly from my page. To get even I changed them to porn and reported it to gamespy. I never saw the guy run another page since
3. A major game site copied exclusive screen shots from my page. They claimed they got them from a press kit. If they did they used mine any ways since I altered each picture and knew they were copied. 3DO said I violated my contract by giving this major site my pictures (I didn't) and threaten to sue me. I was given the picture to create an official screen saver for HOMM3. I had permission to post the pictures. I told them than any image could be copied from any web site but they didn't quite understand. At which point I said fuck it and took down my site.

Rob Merritt -- http://www.moonbasetycho.com

"On cancelling the sale of gamesdomain - Reading between the lines of the in-house announcement, it seemed TO ME that the situation is more like this: after announcing the sale, theglobe realized that they could get more for gamesdomain. Maybe they got offers from other potential buyers? I dunno. It seems like someone may have said "oh, I'll pay you more than THAT if you can lower operating expenses" or something. This is pure speculation--I have no idea. But it doesn't look like the situation is as grim as 'they couldn't sell gamesdomain.'"

--------------------

I would say the situation IS as grim as "they couldn't sell Games Domain." TGLO entered into a letter of intent with Ice. They couldn't back out without being subject to breach of contract. If someone had been willing to pay more, and Ice had the financing in place, they would absolutely have done the deal, or sued TGLO if they had tried to pull out.

Some of the financing for the deal was coming from direct investments by senior staff there. I'm guessing the whole thing just collapsed because Ice Securities could not come up with the cash. Reading TGLO's financials, and knowing the fact that Games Domain has never, ever been profitable, I'm almost certain TGLO would have sold had Ice been able to close the deal. But they weren't.

Yeah, I agree that TGLO wanted to sell. They're looking to cut costs; getting rid of one of their three game sites and getting $5 MIL to boot had to look pretty good.

There just aren't many game sites worth $5 MIL now. What's the use of buying page views if you can only sell them to cover costs? CGO is in a better position because they promote the magazine and Chips and Bits.

Does anybody know approximately how many unique users sites like QT3, Gone Gold, and the bigger ones like Avault get? The reason I ask is while I may not pay $3-$4 a month for any one site I wouldn't hesitate to pay 0.25 for a month's access. If a site had 10,000 "subscribers" a month that would be $2,500 a month, plus any ad revenue. Probably not enough for sites with large staffs but it might be okay for some of the smaller ones.

Looking at my favorites list, I would probably pay up to a dollar a month for the fifteen I check almost every day. It would still be less than I spend on print gaming magazines every month.

Getting 10,000 subscribers would be pretty tough for all but a few sites, I suspect. A site might have 50,000 unique visitors a month, but how many would they retain when they went to a subscription plan?

That's why I was suggesting that at the price of a quarter, many more people would be likely to subscribe. If you have 50,000 unique visitors and 50% subscribe, that 25,000 subscriptions, or approx $5,000 a month.

One of the biggest hitches to any pay website IMO is the fact that its difficult to "browse." At a newstand I can look through a magazine to see if its worth my while to buy it that month. Most subscription sites offer examples of content or offer free trials where you have to go ahead and give them all of your credit info and remember to cancel before the trial membership ends. Neither of these is as effective.

For example I just when to combatsim.com and I don't think I found I single full article that I could preview. Oh sure, there was a long list of the articles available with brief summaries but I couldn't see any actual content without being a member. Who in their right mind would subscribe to that site without seeing the quality of the articles first?

Well, you could make it like a newspaper or a magazine, I suppose. Offer people the ability to see headlines and then check out that days' content for, say, a quarter (which would mesh nicely with the name, BTW). They could use credit cards or PayPal. Once they did it for the first time they'd have an account that would remember their billing info, and they could just click on the Bloodshot quarter icon to read the news that day, if they saw something they liked. Regular daily subscriptions could be sold for anywhere from a nickel to a dime a day, with the option of automatic emails that cover the headlines (and maybe provide links) being sent out to subscribers daily. This would be six days a week at current service levels, so probably around 25 billable days a month, or a whopping $2.50 a month for the dime rate, $1.25 a month for the nickel rate.

It's not perfect, and it sounds pretty cheap, but that can add up to a lot of change if you get enough people doing it. Get a thousand cheapo subscriptions, and you are making either $2500 or $1250 per month, right? Get 2000 subscribers and I bet Tom won't have any trouble finding the time to do Shoot Club again. The web, at least for me, is in big part about convenience. Can I get this info for free somewhere else? Sure. Both the principals in this arrangement are writers, who make a living selling their creations off to anyone that will pay for it. But is it worth more than ten cents of my time each day to hunt all of it down? Nope. As long as it's cheap and convenient, it will probably work. people, I find, are essentially lazy, unless they are riled about something.

Also (and back on the lazy vein), once people START with subscription services, unless it becomes a noticeable cash drain, they tend to stay with those services. I used to work for an online service. We'd get calls, tons of calls, every day, from people who were cancelling their service. When we checked, we found a great many of them had not logged in for YEARS. They paid @ $9.00 a month, not $2.50. Most people are far too busy or lazy to take the time required to go through a cancellation process for $2.50 a month. I promise.

It's also a personal theory of mine that people will buy almost anything if it comes under their definition of "cheap enough." If the outlay is so small that they do not even notice any impact from it, they can be very free with the junk they buy (Not Q23, BTW, just an example I was making). I also worked a lot of years of retail, and have seen it. McDonald's built a worldwide (alleged) food empire based on it. Why wouldn't it work here?

"They have great traffic but they're still losing money because no one's figured out how to convert traffic into profits, at least in the current market."

That's because the first part of the equation: That a more effective way of advertising-has already been recognized by advertisers. But because of the second part- because it is radical and new- everyone is still fidgeting around with ways to make it work. Maybe part of the problem is that I don't think it really hit anyone that the first idea they came up with (banners) wasn't the way to go until just recently. It worked fine, after all, until it became completely ubiqitous. Then everyone just started ignoring banners. There are a lot of minds looking at this. It'll be figured out before long, not to worry. There's too much potential revenue involved for it NOT to be, IMO.

Oh, and about the "banks deal with dollars, not cents," arguement, that isn't a problem. You can charge a per-use rate, and just keep track of the charges. People can then be billed when they either a) hit a fixed billable number, and/or b) have not used the service for a pre-determined period of time. Everyone gets billed, but the banks see less of the mini-charges. I'm also not convinced, BTW, that most banks really care about micro-charges now that transactions are all computerized. I believe that went out in the early '90's.

"It worked fine, after all, until it became completely ubiqitous. Then everyone just started ignoring banners. There are a lot of minds looking at this. It'll be figured out before long, not to worry. There's too much potential revenue involved for it NOT to be, IMO."

A big problem with the banners is that they're in the same place all the time. I read a Delphi forum where the banner ads are in a lower spot, and I notice that I read them much more often as a result.

People hate advertising though. They have to figure out a way to make it more noticeable without it being more annoying.

If everyone had broadband it would be a bit easier. You could actually run streaming video ads. Maybe that's how you do a micropayment. Instead of asking for money, you make the reader sit through a 30 second commercial and then give him or her access. Maybe you only make the reader do that once per week and combine that advertising revenue with banner ads.

I agree in principal that there's too much potential in the web for people to not figure out how to make ads work. They'll figure out something that's more effective than the current scheme but not so obnoxious as to drive away readers. The only question will be what the kind of advertising is worth.

I use a great little utility called WebWasher (www.webwasher.com). It blocks all banner adds and has some other features.

It is great for me on my bandwidth challenged 28.8k link.

" If you have 50,000 unique visitors and 50% subscribe, that 25,000 subscriptions, or approx $5,000 a month. "

Yeah, and if you have an honest 25,000 PEOPLE, then you're serving up like 2-3 million PAGES per month, more if your visitors are the "three times a day" type. If you're cheap and dont host any downloads, that $5,000 will pay for about five days of bandwidth.

Jason @ CGM/CGOnline

(I guess I'll go register for the forums...)

"Yeah, and if you have an honest 25,000 PEOPLE, then you're serving up like 2-3 million PAGES per month, more if your visitors are the "three times a day" type. If you're cheap and dont host any downloads, that $5,000 will pay for about five days of bandwidth. "

Yeah. I think the reality is a lot closer to 5,000 obsessed people visiting the same sites over and over. Not that I would be one of those people. Or anything. Er, yeah.

wumpus http://www.gamebasement.com

Have you been to Iwon.com lately? They are doing some interesting popup-like ads. They appear to be Flash animations that appear in the middle of the page. I wonder if they get better results from them.