Wowio: Great Expectations and Great Disappointments
Wowio’s been in the news quite a bit lately. First there’s all the hubbub about Platinum Studios buying them. Then there’s all the noise that they’re still late on payments, post-acquisition. Now there’s a rising tide of comic book publishers/creators leaving the service and just last Friday, reports of creators sending Destroyer Lawyer to ask for their money. It seems to me there are two things going on with Wowio: unrealistic expectations from their launch and ongoing animosity towards Platinum.
When Wowio launched, they were offering $0.50 every time a comic was downloaded, $1.00 if it was longer than 100 pages. That’s a ridiculously good deal. So good a deal, I didn’t believe it was true until I started hearing about cashed checks. Everyone I know who’s in the mainstream Internet business figured the same thing: the initial rate is an artificially high promotion. It will be cut in half before the first year is out.
I’ll give them credit; they stuck it out with that high, $0.50/download rate longer than I ever thought they could. Still, you know that couldn’t last, and there are some new policies under the Platinum regime: you can still get $0.50/$1.00 for a download, the catch is, those are only available if they currently have a paying sponsor. No sponsor, no paid download. There’s also a going to be free advertising-supported single page browsing, of which the originating publisher or cartoonist will get 20% of the gross. There’s also the option of paid downloads, but nobody seems to be talking about that and I’m forced to assume there must not be a lot of action on that feature or publishers would be talking it up.
The first objection from the publishers is to the non-guaranteed availability of these free/sponsored ebook downloads. Chris Crosby is widely quoted as calling the availability of those downloads “a crapshoot.” Yes, telling people to go to Wowio and get a free download, but not knowing if it will be really be free is a questionable business practice. Unfortunately, I haven’t heard any comments on what percentage of the time sponsored downloads are available. I did go to the Wowio site and downloaded the first issue of The Trouble with Girls, which was kindly sponsored by EA Sports and Madden NFL ’09. This is where that trust issue comes into play. There are a lot of vocal publishers that don’t trust Platinum to maintain sponsorships 24/7. Alas, until you’ve watched it for a few months and tracked availability, making a judgment on sponsorships is problematic. If they have sponsorships up 95%, this might not be such a big deal. If 50% is closer to reality, you might have second thoughts about promoting your work there.
The second part of this equation is the banner ads with the free “preview” viewing. Chris Crosby, again, is widely quoted as feeling that not only are the banner-supported view a form of channel conflict with his own websites, but they also yield lower ad rates. You know what? If you put out your own webcomic and offer an ebook on Wowio, he’s absolutely right. If you aren’t putting your own material online, it’s merely an additional revenue stream, albeit not a particularly robust one.
There was some bad math going on in the Comic Book Resources article, when it comes to estimating income off banner ads, largely because there are two ads on the page, but there are three factors fueling the indignation from print people: unrealistic expectations from that download price, unknown ad rates and unfamiliarity with webcomics traffice patterns.
First off, let’s take a look at those $0.50 downloads, in terms of their equivalent ad rates. Banner ads are bundled in units of 1000 page views called a CPM. If you’re running a banner ad priced at a $1.00 CPM, you need to have 1000 pages viewed to collect a dollar. Let’s be generous and say that a comic book download is 36 pages (32 interior pages plus inner and outer covers). To get $0.50 from a person reading that comic online, with two ads/page, you’d need to be charging a rate of a little under $7.50 CPM. If you’re 22 pages of comics and a cover (23 pages for the installment), you’d need to be a CPM of approximately $10.90.
That’s assuming you can get the same price for lower banner. A below the scroll banner (and that’s what the lower one is) doesn’t get the same price as one at the top of the page. To be honest, the network I use for my personal site doesn’t have any below the scroll banners like you see on those preview pages sold right now. So figure you probably need to bumping those numbers by at least 50%.
A CPM of $10-$15 for comics? Not unless you’re able to target some specific demographics. I’m not saying there aren’t some people doing it, but run of network advertising in the entertainment category of a decent ad network is probably going to be in the $1-$5 range. And then you have to give the network 40%-60%, depending on who you’re dealing with, so your net is a $0.40 – $3.00 CPM range. (I think you’ll find the average CPM closer to $2, currently.)
Platinum/Wowio is only giving you 20% of the advertising net. Let’s say, for the sake of argument that by hook or by crook they’ve got the same rate for both ads, which would give you a theoretical net income of a $0.20 – $1.00 CPM. Using rough estimates, that’s ½ to 1/3 of what you could get from a general ad network. If Platinum can get much more expensive targeted ad buys, things will be closer to even. That remains to be seen.
That’s also assuming they don’t have any unsold inventory, which would result in revenue-free page views, which does happen to most people from time to time.
Platinum/Wowio hasn’t given out ad rates to their publishers. They just want to give publishers a number at the end of the payment term. And, with that negative trust factor, there’s howling from the publishers. Here’s the deal: it is very legitimate not to want to predict what your ad rates will end up being, in terms of a guaranteed rate. There’s ebb and flow to pricing. Nobody tells you what the rate will end up being next month, because they don’t necessarily know. Now, if you’re in an ad network, you _will_ know what rate you’re getting while a campaign is running. Of course, if you’re using an ad network, you always have the option of switching networks on your site and that’s not the case with Platinum/Wowio. In Wowio’s defense, they may not have their infrastructure set up for real-time ad reporting. Still, that’s a legitimate gripe and they’d be well advised to set that up. It’s not like the whole world isn’t going to know their functional CPM five minutes after the payments go out.
There are two more trust issues that should come up, but haven’t yet.
One: Platinum has a vested interest in promoting their own titles on Wowio. As I type this, the number one title on the “Top Comics” list is Atlantis Rising: The Complete Collector’s Edition, published by Platinum. Will Platinum titles be getting a little extra push on Wowio? It is their sandbox, after all.
Two: Who’s auditing the banner ad rates? If the numbers look low, this will eventually come up.
Look for Platinum/Wowio to cut a deal for downloads only (no free preview) if they’re smart. If you’re a print publisher, that preview ad money is just free money if you’re not putting your comics on your own website. If you are putting comics on your own website and you have hooked up with an ad network, you are almost certainly getting a better ad rate there and you’ll be able to supplement your income with merchandising. If you’ve got comics on your own website, this is a clear case of channel conflict.
The questions Platinum/Wowio publishers need to be asking themselves are:
Are those sponsored downloads available frequently enough to be worth my time?
Can I use Wowio to bring new users to my own website?
Will low functional CPM rates cause publishers to ditch Wowio? Of course it will. Just in the field of webcomics, Blank Label Comics is a well-known example of a web cartoonist group that split off from Keenspot with setting up their own advertising as a key agenda item.
The other reality of the situation is that while the inflated income from the sponsored downloads is a good and tangible thing, those free preview pageview numbers for comics as reported by Publisher’s Weekly and Comic Book Resources are very small compared to that of a popular web comic. Bill Williams talks about 14K pages viewed. Darren Davis talks about his titles being “viewed for free nearly 90,000 times.” (I can’t tell if that’s page views or unique visitors.) Questionable Content, a popular webcomic, will get 150K-200K unique visitor each WEEKDAY. Wowio doesn’t seem to be generating that kind of traffic for a single publisher, and that’s the realm they’re now competing against with ad-supported views.
I hate to rain on the Wowio parade, but sites like this grow traffic by having a strong network of content providers and if the more popular ones go away, it bodes ill for the site as a whole. That nickel stock price Platinum is sporting as of my typing this isn’t terribly encouraging either, especially with the stock market as unstable as it is.
The ball would seem to be back in Wowio’s court to react or not react to the complaints of their content suppliers. We’ll see what happens, but don’t blame any publisher for making contingency plans.
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