Is running a subscription web site your ticket to profitability? We take a closer look.

If there is one clear lesson from the dot.com crash it is this - you can't give everything away for free. At some point, you have to figure out a way to generate revenue - if you hope to stay in business.

A lot of people learned this lesson the hard way. They spent millions developing grand web sites, yet never figured out a way to generate any revenue. And now the money spent and the sites themselves are mostly memories.

But not all internet sites disappeared.

Some discovered that their road to profitability lay in subscription sales to access the content on the stied. For many of these sites, the revenue generated by subscription sales kept them in business while sites that pursued other business models floundered.

Subscription Web Sites

Basically a subscription web site is one where only those visitors who have paid a membership fee (subscription) are allowed to access premium content on the site. It's the same concept as a newsletter or private club - only those who have paid to join, can get in.

The main advantage of running a subscription web site is obvious - it allows the site operator to generate revenue to cover the cost of creating and maintaining the web site.

Other advantages are less obvious.

For example, many free sites have high overhead required by the large number of visitors to the site. The more visitors that use the site, the heavier a load on the server, and other site infrastructure. This load usually equates to much higher dollars spent in support and site maintenance.

With a subscription web site, you only have a fraction of the visitors using the site - and this equates to much less load on servers and maintenance.

And while fewer visitors sounds like a bad thing, many site owners have discovered that it is far better to have lose 99% of your free visitors in return for the revenue that the 1% of paying members generate. (In essence you lower your overhead, and raise your revenue at the same time.)

There are advantages to subscribers who join subscription web sites.

Much like an exclusive gated community or 'members only' country club, subscribers gain access to unique content within the members only area, usually not available anywhere else on the web. This content often includes exclusive articles, exclusive access to an expert, and exclusive access to software and file downloads not available to non subscribers.

Like private country clubs, there is the social aspect of being a member of an exclusive 'club' (subscription site), where members find a community of like minded people that come together with a common focus or goal. Often members of subscription web sites make valuable contacts and connections through the private discussion areas on the site.

Another major benefit of being a member of a subscription web site is that the 'members only' walls delivers a certain degree of privacy and protection from forces that might want to interfere or disrupt forums and other resources within the site. (If you have ever participated in a free discussion group, you probably have seen how just a few bad eggs can cause its ruin.)


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