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Table 5 Common expense buckets for online publishers

From: Economic Essentials of Online Publishing with Associated Trends and Patterns

  Description Sample expenses
Content & production • Expenses associated with the creating, producing, purchasing, and acquiring of content
• Costs will vary depending on type of content (flat vs. video, etc) and type of business (tv shows vs. social/user-generated content)
• Crowd sourcinga is a relatively new and sometimes viable option (google “Netflix Prize”b)
Designers, editors, project managers and coordinators, site directors, producers, content licensing fees, research and analytics, production costs
Software development • Mostly labor and some software license costs associated with building and maintaining the software systems for managing, publishing, and distributing content
• Can be enterprise content management, to digital asset management, to custom programming applications
Software engineers, quality assurance analysts, project/product managers, development tools, software licenses
Infrastructure • Costs of hardware, software, operating systems, hosting and bandwidth for the storage and distribution of content
• May include enterprise IT operations, desktop support, test environments, Internet connection fees
Hardware (servers, routers), bandwidth and hosting, software licenses, operations and network engineers
Traffic acquisition • Aka user acquisition costs
• Costs associated with acquiring unique users, increasing pageviews, and promoting site activity
• SEO = improving organic (non-paid) traffic
• SEM = paying for sponsored traffic
• Social = marketing via social networksc (Facebook, MySpace, Twitter, YouTube, etc)
• Goal is to be viral!
Traditional marketing (print, online banners, etc), SEO, SEM, social media marketing
Sales & business development • Cost associated with ad sales, partnerships, and business development Sales analysts, business development analysts
Other operational • Bucket for everything else IT operations, desktop support, legal, rent, facilities, other misc costs
  1. aFor more info on crowdsourcing, see Wikipedia: http://en.wikipedia.org/wiki/Crowdsourcing
  2. bPopular 2006 contest where Netflix offered $1 million USD to the contestant that improves their movie recommendations by 10%. This contest spurned the participation of many, many smart people—including the world’s foremost experts in statistics and engineering—much more brainpower than Netflix could’ve paid, in salaries, with the same $1 million: http://en.wikipedia.org/wiki/Netflix_Prize
  3. cFrom Wikipedia http://en.wikipedia.org/wiki/Social_media_marketing