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Post by milowent on Sept 17, 2006 1:38:34 GMT -5
Thought it might to be nice to have a thread discussing how and whether the Creators can turn LG15 into a profitable venture. Clearly, it seems they started this venture off without a big plan in the profit department. So, to borrow BaileysMom's phrase Internet MiniSeries (IMS), how does this IMS, and future IMSes make a profit? Because without reveue, you can't survive for long.
These seem like the obvious revenue options. I've never done web marketing, though. I'm really interested in hearing others' opinions.
1. Advertising based - banner ads
2. Advertising - product placement in videos -This was something often speculated about in the old forum, it was anticipated that if it occurred, it would prove LG15 fake. If we suddenly noticed her holding a can of diet coke and/or saying "I luv Diet coke!"
3. Subscription based. That is, people pay to gain access to LG15's episodes. I highly doubt this would ever work, it would kill 99% of the audience.
4. Revver.com model -- I.e., Revver is supposed to pay the authors of their content for views? Does anyone know how much they pay? (This reminds me of the old mp3.com pay for play program from around '99.)
5. Others?
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flwright
I Know More About Internet Video Than Wikipedia
Human Bean
Form follows function
Posts: 365
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Post by flwright on Sept 17, 2006 7:38:16 GMT -5
Interesting topic, milowent. There are many creative sites that are struggling with the same dilemma. We all know ccmixter, a music site and home to several of my favorite lonelygirl15 songs ( Brilliant Daze, a collaboration between Pat Chilla and Lisa Debenedictis, it's brilliant!). I wish there was a better way to pay the musicians for their effort. I use Flickr as my photo site. Like ccmixter, it's based on the Creative Commons license. There are lots of very high quality photos there. The strength of the site is it's emphasis on sharing. I wish there was a way to reward the starving photographers with something more than a nice comment under their work. That's the problem. Is the free and unfettered sharing of creative content compatible with commerce? I'm intrigued by the Revver model. It's a Creative Commons based site. Runs on Open Software. It's also a very old revenue model, content mixed with commercials (Your option #2), tried and true. The Internet is killing the TV box, but drinking from the same life source. I hope YouTube is paying attention. FLWright
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BaileysMom
Cove Sr. Investigator
I Bring Home the Bacon...Yada, Yada, Yada
Posts: 248
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Post by BaileysMom on Sept 17, 2006 8:25:40 GMT -5
The kicker of all of this is that big companies, that would traditionally spend millions and millions on TV, know that with the advent of 600 channels on TV plus the internet, none of it is an economical spend. New cable channels are added every day, each more specialised than the last. The number of special-interest magazines continues to grow. Media fragmentation is killing every brand manager that seeks a broad or diverse market.
On top of that, if you have a product that you would market to children, the consumer groups are brutal these days. And anything marketed to teens cannot feel like it is marketed to teens or they turn it off immediately.
Revver has the potential to be the correct model FOR ARTISTS but there are a few things that are not working in their favor to draw CONSUMERS:
1. The advertisers they have currently are not ones that I would ever click - so the artist will not see a revenue stream from me, even though I might be fiercely loyal to that artist.
2. I think consumers are becoming more wary of clicking on any web advertisement - spyware, cookies, etc. I mean, come on. If buy anymore penis enlarging products for him, my husband is going to really be offended. (this is a joke, just in case you missed the sarcasm)
3. Revver, the brand, (yes, here I go again) does not explain to me exactly what it is all about. So they were lucky enough to have their logo plastered behind Jessica, Yousef and the Creators' heads during their MTV appearance but I'm not sure if it was a strong enough visual cue to cause consumers to seek it out. Alternatively, anything overt turns off that much-sought-after teen demo who does NOT want to feel marketed to (it's okay to market to them, but it better be subtle!).
4. White folks everywhere! The fastest growing demos are non-whites. But all I see on Revver are white folks, the english language, and more white folks. Yes, I know there is one African-American dude on the front page...but do the math. Lotsa white folks.
5. I am fluent in french, and I do not mean the kind you speak in Paris (well, okay, speak that kind too). I can hold my own with any sailor this century or last! But even still, I am mortified by the nonsense in the YT comments. Revvver is smart to allow consumers to rate a video without the comments. Unfortunately, though, I think one of the things that appeals to people so much is the ability to interact. This is the conundrum marketers face today - damned if you and damned if you don't.
6. Revver is rating the movies just like the theaters do - G, PG, etc. Um, great for parents. Big turn off, again, for teens. But what happens when Mom stumbles across Joey's Myspace, full of rated R videos courtesy of Revver?
7. I know there is another point, but my puppy is whining at me. So I will come back and add another point or just admit that I already said enough.
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Post by VanillaFlava on Sept 17, 2006 9:21:02 GMT -5
Nice post BM, I completely agree.
I am a little puzzled by Revver. The site itself is pretty non-descript and not very engaging. It is also a real b&$ch to navigate, despite, or maybe, because of the spiffy Ajax interface.
The real advantage that they have over YT is that their model still works, even if the videos are distributed or embedded somewhere else. I mean, what does YT gain, if I embedd their videos on MySpace? Lotsa extra bandwidth, and maybe a bit of branding ... not very good at all. So, I think people will start embedding the Revver content on their pages directly, instead of sending their audience there, which is also much nicer for controlling your brand.
I think the Revver model will not generate lots of revenue for it's artists, however. Especially if it is click-based. The MPU format shown at the end is essentially a branding format, not a click format. I don't know about the US, but here in Europe it still has very nice CPMs (from my side of the revenue stream, i.e. in selling it). The clicks also do not seem to work correctly ... possibly pop-up blockers, Quicktime quirkiness or whatever. I would suspect they will become more aggressive soon start embedding streaming ads, possible even more intrusive ones in front of the content (urgh).
One thing that Revver has going for them though, and that has not been explored at all is Mobile content. Revver seems to be trafficking to Mobile channels as well. And the snack-size LG15 content is just perfect for mobiles. This might not be such a penetrated market in the US, but here in Europe it is huge! Operators like Vodafone and T-Mobile are increasingly pushing mobile video content, and this is usually upfront paid, or subscription based. It is funny, but as soon as something shows up on a handset, people are just so used to paying it isn't such a big deal anymore as it is on the Web. Vodafone is interesting, as they are also trying to muscle in on the broadband market in a big way, with a real hunger for content.
Additional revenue can then be created around mobile community content. I am sure that operators will stumble over themselves to get a slice of the LG goodness. Maybe this is a little japanese-culture based, but I could see people watching their latest IMS on the subway to work.
The catchphrases that are buzzing around the industry right now are convergence (yes, back from the grave) and tripple play (i.e. serving your media over various channels, telephony, broadband and audio-visual channels). I could very much see LG15 becoming a flagship service here. With the content and community spread over these channels. On the move you can watch and vote, back at home you can interact with the rest of audience.
I would expect a revenue stream as follows, dominated still by advertising (~70%), mobile premium services (~20%, possibly lower in the US) and other including sales of DVD content etc (~10%).
The conundrum is where the big chunk of advertising is coming from. I am unsure about Revver. If it is web advertising, either CPM-based (banners, MPUs) or keyword-based (i.e. Overture or Google). This could be done in a pretty subtle way, and with minimal effort to the content creator. The further you remove yourself from the sale, the worse your cut of the campaign revenue will be though. And the real driver here would be page impressions ... lots and lots (I mean it!) LOTS of them. This kind of model only works with scale.
How large do we think the total audience is right now? 200.00 unique visitors maybe? That is not bad at all, but you really need a whole lot more, or get a really good ratio of PIs per UV to get to a model where you would show up on the map for advertisers. Otherwise you would just get the generic traffic that your sales partner (i.e. AdLink, or in their case Vantageous) can traffick on your PIs.
Uhm, I think this is about as much as I can say publically about these topics without people starting to wave NDAs in my face. But I see some interesting models here, for sure. This comes at a very intersting time in the market.
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Post by noasinger on Sept 17, 2006 9:37:18 GMT -5
I can't speak from any stance but an interested, uninformed layman, but....
Can you fascinating people weigh in on the Salon.com model? Salon doesn't embed many ads. They have a waystation system, requiring that people coming to view their content must first view an ad, usually flash-based. But unlike most waystation formats (what is the actual term I should use for that?), you may opt out by subscribing to salon.com.
Salon has been using this model for a few years now. What do you percieve as its strengths and weaknesses compared to Revver's current model? Would this be a good alternative model for an interactive media supersite which hosted several different IMSes?
Edited to add: Flav, I've read over the years that Mobile content is also a monster profit generator in Japan, largely due to (or assisted by?) the long commutes to and from daily activities for students and the workforce. (And, oddly, the Japanese passion for all things small and cute, making small mobile screens and keypads less of an irritant to them.) The American workforce outside the NYC corridor and a few other urban centers seem to have an aversion to commuting. We couple this with a common distaste for public transportation. This leaves our consumers with comparatively few moments of forced idleness away from our homes and offices and may have slowed the initial growth of mobile content in this country. Is there any correlation between mobile content popularity and forced idleness in Europe?
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Post by VanillaFlava on Sept 17, 2006 9:52:52 GMT -5
Hmm, the formats you are referring to are called interstitials. And yes, this is where a lot of the media formats are moving toward. The click-rates of classic banner ads are just becoming too miniscule (we're talking way less than 1%) for anybody without massive scale (i.e. portals still being the exception because of their immense reach).
The basic trends are:
- The advertising must be targetted (the narrower the better, hence the need for scale or you reach too few people) - The advertising needs to be visible (bigger is better, full-size banners are already mentally screened out. Widebanners and MPUs are better, Skyscrapers have pretty much joined the Dodo). - Very much moving toward streaming and branding content
Very few advertisers can actually pay you on acceptable CPAs, because their customer lifecycle revenues are too low, and again there is the traffick problem. There is a shift in the market though. The Internet bubble burst because the principal advertisers were actually .Coms themselves, so everybody simultaneously ran out of cash. Now, the market is picking up because traditional brands are starting to devote increasing slices of their marketing budget to the web, and the potential is huge, as they are still spending way more on TV and print.
The flipside is that for the users, interstitial formats are really the max in intrusiveness (one step short of making you sit through TV commericals), so this hurts the content creators obviously. An opt-out model like you describe also only works for content you become loyal too, i.e. you would only pay if the site was one of your top visited destinations for entertainment, community or news. Anything else and your involvement is too low.
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flwright
I Know More About Internet Video Than Wikipedia
Human Bean
Form follows function
Posts: 365
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Post by flwright on Sept 17, 2006 12:14:02 GMT -5
Noasinger, I happily subscribe to Salon (well-written articles on a variety of subjects, very funny comics, but not much fiction). It reminds me, at times, of a Web-based New Yorker. And all of the content is available free to those who are willing to put up with the ads. At the time I subscribed many cyber-centuries ago (two years), the ads were pretty intrusive. They consisted of a full window "you-will-watch-this-before-you-read that" imposition on the surfer. I hated it so much I was willing to pay to make it go away. BaileysMom, The "white-folks everywhere" comment is very thought-provoking. I grew up white in a small southern town, called Washington, DC, where there were "black-folks everywhere". It was the best experience of my life. For most of us on this forum and others, our first introduction to others is pretty color-blind. We can only really judge by the quality of our thoughts. That's very cool. VanillaFlava, Your comments are always thoughtful and terrific. It's hard to believe that English isn't you first language. I loved Twin Peaks (at least the first half-a-dozen episodes). I think of the theme song everytime I see your avatar of Agent Cooper. Twin Peaks would make a really fine ARG. (Edit 9/18-You may want to spell out BaileysMom in the future. In English, BM could be taken the wrong way.) Another beautiful day in New England, gotta get some fresh air, FLWright
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Post by milowent on Sept 18, 2006 22:17:56 GMT -5
A Marketing article re LG15, Associated Press: home.hamptonroads.com/stories/story.cfm?story=111133&ran=82224Come look at this! Marketing lessons of Lonelygirl15 By KARLA STARR, Associated Press (ASAP) September 18, 2006 You spend all day avoiding commercials, deleting spam from your inbox, and ignoring billboards entirely. But Lonelygirl15? That, you passed along to a friend. As it turns out, everyone did. But the YouTube phenomenon Lonelygirl15 -- millions of people viewed her 31 videos -- was made by 28-year-old Miles Beckett, 26-year-old Mesh Flinders, and 27-year-old Greg Goodfried with a $130 digital video camera. In other words, it was made with nothing but a few sound ideas. And now, the three Creative Artists Agency-repped men have some of the year's best buzz. asap takes a look at how Lonelygirl15 became the viral event of the season -- and how advertisers can turn that chat into some serious coin. 1. Content: New! Real! When customers spread the message themselves, the payoff -- viral marketing -- is a dream come true. Ads typically become viral when their content is so unexpected (Samuel L. Jackson's personal phone calls for Snakes on a Plane), bizarre ("The Extreme Diet Coke and Mentos Experiment") or funny (Carlton Draught's audio ads) that you have to share it. Lonelygirl15's quirks -- religious rituals and a Richard Feynman obsession -- were a little bizarre, but not outrageous or hilarious. And the quality? "Of course the quality is mixed. That's real," says Seth Godin, marketing guru and author of "Small is the New Big." "They paid attention to getting it right, and resisted the temptation to make it 'better.'" Something that's too slick reeks of a corporate campaign, but having access to a pretty unknown's secrets was tantalizing enough. People want to see something real and raw. "A lot of times when companies are putting out stories about real people, they lack that true underground feel that would make you want to forward it on -- it's overly done," says Lisa Johnson, author of the new "Mind Your X's and Y's: Satisfying the 10 Cravings of a New Generation of Consumers." 2. Use pathways that are already there Lonelygirl 15 wasn't making people find her -- she put herself on YouTube, which gets more than 20 million hits a month. Are those really numbers you want to compete with? Exploiting pre-existing social networks like Facebook is a better way to get eyeballs than creating a corporate site. And by keeping things on their own terms, "people feel a greater sense of ownership with the brand," says Joe Chernov, director of public relations for BzzAgent, a Boston-based marketing firm specializing in word-of-mouth campaigns. 3. Interact with customers Bree begins one video, "A Peace Offering," by mentioning how many viewers wanted her to make a peace offering to Daniel. The perception of interaction -- dubbed "collaborative storytelling" by the filmmakers -- was key. "HP's campaign, 'The Computer is Personal Again,' was so brilliant. They really understood that people want to take what's out there, personalize it and leave their mark on it," says Johnson. These interactions can be simple, like Burger King's "Subservient Chicken," which allows people to direct a man in a chicken suit -- and racked up 400 million hits. Or, they can go further: companies from Converse to MasterCard have recently tapped into the customers' creativity, and their desire for a big break, by sponsoring contests to let them design ads. 4. Success breeds success Lonelygirl15 made enough videos to let its fanbase grow and eventually cross the "Most Watched" threshold. After that, each new video earned a visible spot in that coveted YouTube section. For thousands of time-strapped Web surfers, it's an unbeatable seal of approval that's destined to earn a bundle of blog links. "There's an element of Darwinism to those sites, where certain success begets success, and that helps certain programs, videos or profiles propagate and take on a life of its own," says Chernov. And if you can't earn your way there, you can buy it: Google Video and YouTube will place videos in visible locations on their Web sites for a fee. 5. Be mysterious Look at Lonelygirl15's room -- do you see a huge Nike poster in the back? Did she ever lift up a Starbucks cup or talk about how much she wanted to see "The Last Kiss"? Nope. "We are sick and tired of advertising. Instead, people are drawn to spaces and brands that feel like advertising-free zones," writes Johnson. Remember the "Blair Witch Project?" Like Lonelygirl15, people initially thought the brand-free video was unscripted entertainment, no strings attached. The directors waited to pull back the curtain until they'd gained a captive, gossiping audience. The key to making your message a part of your customers' lives is to give your product the lowest profile possible. According to Godin, "There will be exceptions, of course, but in general, we want people, not corporations to be part of our lives."
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Post by jayhenry on Sept 19, 2006 12:40:08 GMT -5
A year or two ago, this video "Epic 2014" circulated in media circles. It's a look at how technology firms could change the mediascape. It's 9 minutes long, but for my money, well worth it. www.youtube.com/watch?v=dKWK3xfvs-kThis video was written with news media in mind. But its implications are the same for entertainment media. The idea is common, especially in Web 2.0 circles, that someday everyone who produces content on the internet will receive a teeny-tiny piece of a giant, giant pie. Revver hopes to be a portal for collecting crumbs, billions of pennies after all is tens of millions of dollars. Whether or not these models actually work remains to be seen. In theory, the most talented creators will leave for sites like Revver because of the potential pay-off. The masses will follow the content.
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Post by noasinger on Sept 20, 2006 9:38:12 GMT -5
These are also themes which have been playing out in cyberpunk fiction for almost twenty years now -- especially check out Bruce Sterling's Islands in the Net.
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Post by jayhenry on Sept 20, 2006 10:57:19 GMT -5
These are also themes which have been playing out in cyberpunk fiction for almost twenty years now -- especially check out Bruce Sterling's Islands in the Net. For those unfamiliar, cyberpunk is a sci-fi sub-genre, often traced back to books like Neuromancer and Do Androids Dream of Electric Sheep, which has morphed into movies like the Matrix or great video games like Bullfrog's Syndicate, which I for one loved as a kid. The reason that the near-future sucks in the cyperbunk world is usually because giant corporations use technology to oppress everyone. This is interesting, because I don't think cyberpunk has ever really looked at what happens to the artist of the future. These cyberpunk worlds usually have a lot of Bansky types, but not a lot of discussion regarding the future of mainstream entertainment. So the question with Lonelygirl15 is this: does this represent a defeat for corporate entertainment media? In order for that answer to be "yes," I think Lonelygirl15 has to 1) make enough money to keep the five people happy (happy enough to stop Hollywood from stealing them away) and 2) be taken seriously as art. If this project can't sustain itself, with all the hype and fans, what are the odds that anyone in the future is going to follow the model? And if it's not art then who really cares about pop-entertainment merely because it's not being produced by a major studio?
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Post by milowent on Sept 21, 2006 8:45:05 GMT -5
I found this link off lg15.com (foremski): 21st.blogspot.com/2006/09/ads-videos-better-content.htmlRevver is one of the first video sharing sites to offer cash in exchange for uploading or sharing videos. If you create content and upload it, you get 50% of the ad revenue every time someone clicks an ad in your video. If you just share it by posting it on your blog or site, you get 20% of the ad revenue. [Milo Notes: So you have to actually click on the ad for LG15 to get some $$? What is the percentage of clicks? It must be real low.] This strategy is reminding me a lot of the first dot-com craze where you could earn cash by viewing ads on your computer or stock up on points-for-prizes by using a certain search engine. Still, this might be a good way to catch up with Youtube. Early signs of success include Lonelygirl15's shifting her video distribution from Youtube to Revver. [Milo notes: Not proven they're really doing this yet, at least exclusively. Her revver hits are a fraction of her youtube views]To really monetize your videos though, Metacafe might be a better choice. You get $5 per 1000 views. Pay-per-view versus pay-per-click. Time will tell if explicitly monetizing videos will allow these sites to beat out sites that rely on the sharing principle. For those who want to view more professionally composed or entertaining videos, these sites might be a good place to start. If the creators seriously expect to make money from their work, there might be a higher than average chance of finding something worth watching.
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Post by jayhenry on Sept 21, 2006 10:59:12 GMT -5
I found this link off lg15.com (foremski): 21st.blogspot.com/2006/09/ads-videos-better-content.htmlTo really monetize your videos though, Metacafe might be a better choice. You get $5 per 1000 views. Pay-per-view versus pay-per-click. Time will tell if explicitly monetizing videos will allow these sites to beat out sites that rely on the sharing principle. But even this is not good news for our IMS producer. Bree and her 16,000,000 views, even if they had all been on Metacafe, would have only generated $80,000. So you have your logitech and your outdoor cam, your Target props, etc., you split the paycheck 5 ways and everybody is making about $15,000... It seems to me that, in order for an IMS soap opera to work, it needs to get back to basics -- it needs to get back to the soap. The whole reason they're called soap operas, is because originally the soap companies were their big sponsors. The problem, then, is the violent and irrational revulsion that the MySpace generation has against advertising. Remember early on, when everyone assumed Bree was somehow pushing a product, and a couple hundred people would post some variation of "f*** off and die, viral marketers" on every video? The question becomes, how do you have a sponsor and not have the MySpace legions go berzerk?
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Post by milowent on Sept 21, 2006 11:28:35 GMT -5
Good ppoint, Jay. There's not a lot of money in these current ad-based models for the content producer.
product placement would be very touchy, but it seems like it has to be explored.
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Post by VanillaFlava on Sept 21, 2006 13:54:05 GMT -5
I think you guys got it wrong. Forget looking at the videos. You'll not be making money with them. Click-rates are abysmal (way below 1%), product placement and sponsoring is hated by the audience and will turn people off. So, the videos are what gets people into the shop.
You'll make money on the interaction. The, hopefully, millions of page impressions you generate on the forums etc. These you can monetise with a select few ad formats. I would go for either Overture or Google sponosered links, as well as a juicy big branding format like an MPU (it's a rectangle, I bet you've seen it). If you can find a partner who sells your inventory consistenly (and you make sure it's targetable) you should see ok revenues. Nothing to retire from but it's a start.
Then you get the music downloads etc. into the mix. The coolest thing about the WB/YT deal is that all of a sudden, people can use licensed big-name artists in their video, by buyng a cheap broadcast license ... the viewers in turn can download the songs ... ka-ching!
@noa: Yeah, I think there are two factors which make mobile huge in Japan and big here in Europe. One being, excellent public transport and people commuting and most of all unified standards. For the first, both in Japan and Europe we live in pretty packed-in places. People don't have to move city, if their job is in the next one over, there's trains taking you there.
As per standards. Japan had DoCoMo's i-mode which was a mega-hit in Japan, and in Europe we at least had GSM, GPRS and WAP from the start. Which means potential content providers only have to target one platform, instead of having to support rival systems from various different operators. We also have pretty much total coverage, even in subways, on trains, etc.
The US is only slowly adopting comon standards and compared to Europe coverage is pretty shoddy.
The next revolution is right around the corner and some heavy-weight technologies will be fighting it off. Either it's going to be 3G technologies (UMTS, etc.) or actually, it's going to be WiFi and WiMax. I put my money on the latter because it means your phone is pretty much like your computer a multi-purpose client hooked to an IP-Pipe. Then you could put stuff on it as you like ... don't like to pay for voice? Well, Skype. Don't like to pay for SMS-text messaging? Well, put a Messenger on it. Want video? Well, there's plenty of web services that offer a mobile portal.
The thing is, that will majorly piss off the Mobile Operators, i.e. Vodafone, T-Mobile, etc. because they're being cut out of the deal and will only see the money for the traffic, not the service anymore. And it's pretty much flatrate anyway. So, these guys are pretty heavily funded, and they look toward the future and weep. If they could get excellent content on an exclusive deal, they will pay you handsomly, trust me.
This strategy (I mentioned it earlier) is called tripple play. Basically, you can offer content over mobile, broadband and av channels. LG15 seems tailormade for a tripple play service provider. You would stream the big episodes over the web, you can have them on the phone as well, or create special ones just for the phones (people want to see everything so they pay for that), you will have the interaction on all these platforms as well. With messenger and boards availble. Heck, you could even put a social network for your community into the mix. It would be huge!
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