Let's talk about value4value and zaps.
Let's start with the fact that I love the idea and have been promoting it - both in podcasts and here on Nostr. I've written about it in my book Cryptocurrencies - Hack your way to a better life (the particular chapter is published as a blog below).
What is missing is the understanding of magnitude. When people say "people could make living by creating content and receiving zaps and boosts", we are missing one important aspect. Yes, technically, this is possible. In reality, quantity is important.
I'll start with a story from Paralelní Polis - Institute of Cryptoanarchy. The place literally made millionaires. We've been talking about Bitcoin for 10 years. Doing Bitcoin meetups, most of them for free. We had stickers with address for donation. People were coming, learning, buying BTC. One of our co-founders was asking people if they got some value and donated (more on the problematic use of this word below). Again, these were people that maybe doubled their wealth... Once, the answer was "I bought a 'club mate' to support you". So the founder ran a calculator app on their phone. It went something like this: A club mate costs 3$. Our margin is 20% (and that's gross margin), so $0.6. Rent of this place, with energies is let's say $100 for the meetup. There are people at the bar, someone doing the talk and few people helping to onboard people. So that's let's say $200 in wages. Not even saying that we pay rent and people to create these events, promote them, so people know about them. Let's say a real cost of the event is around $500 (very conservative estimate). So that would mean people would have to buy 833 club mates just for break-even. Do you think this math works?
While we _technically_ could be financed from people (the QR codes worked), people chose to drink sweet mate drink and thought they were supporting content creators.
I think this is the same case with Nostr zaps and value4value. Let's start with podcast. Studio rent - $100 per hour. So for 2 hour podcast, you need 3 hours: $300. You need some hardware, let's say capital is $30 per episode. The podcaster needs to film it (3 hours), edit, upload and promote it (let's say 2 hours). 5 hours at $50/hour = $250. So a single podcast episode is $550. A 5000 sat boost is $1.3 now. So you need 423 boosts just to break even.
Is it technically possible to get 423 boosts of 5000 sats on your podcast? Of course. Does it happen? Not much. Most listeners don't even know how to boost. So unless you do a Bitcoin-focused podcast, or have a specific audience, you are unlikely to break-even. (if people stream 100sats/min, then for 2 hour podcasts, you need 174 people streaming the whole podcast).
Let's talk about blogs. I won't bother you with math, but writing an article takes time. Then you need to create images, promote it, ...
If we want to move away from advertising, for both podcasts and text content, the technology is here. But it's unlikely to work in practice any time soon.
How do people make money now? They share a referral link to some product or service (unfortunately, very often some KYC bullshit). It gives listeners discount and the content creator 10%-20% of the value. If the product is $100 value, it's $10 per purchase. Will 55 people buy to cover the cost? Not so easy, but if you have a few thousands listeners, it is not unlikely.
If the product is yours, it is just a marketing strategy. I get more than 10% if I sell my book or course, there are still costs, but that's the way to support it.
I am not complaining - we have complete control in what we produce, how we share it and what our business model is. What I am saying, that 100-1000 sat zaps is not "paying for content creators", at least not anytime soon. I still love the feature, it creates a flow of value, is a form of feedback and it's beautiful. So keep zapping. But when you get value from some content, don't fool yourself that your $0.2 is "paying for the value".
What about the donations? Roy from Breez said something really nice at BTCPrague - don't ask for donation, because you will get a donation. If the blog post / podcast gives you $10 in value, give $10. Ask for people to add a price tag to the value people received and pay that. What was the value of learning about Bitcoin in Paralelni Polis and doubling your wealth? I can tell you what it's not - drinking a club mate. Plus it has tons of sugar.
https://juraj.bednar.io/en/blog-en/2021/06/14/financing-content-creators-and-pocasting-2-0/
juraj / Juraj
npub1m2…lr8p9
2023-06-17 09:29:31
Author Public Key
npub1m2mvvpjugwdehtaskrcl7ksvdqnnhnjur9v6g9v266nss504q7mqvlr8p9Published at
2023-06-17 09:29:31Event JSON
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"content": "Let's talk about value4value and zaps.\n\nLet's start with the fact that I love the idea and have been promoting it - both in podcasts and here on Nostr. I've written about it in my book Cryptocurrencies - Hack your way to a better life (the particular chapter is published as a blog below).\n\nWhat is missing is the understanding of magnitude. When people say \"people could make living by creating content and receiving zaps and boosts\", we are missing one important aspect. Yes, technically, this is possible. In reality, quantity is important.\n\nI'll start with a story from Paralelní Polis - Institute of Cryptoanarchy. The place literally made millionaires. We've been talking about Bitcoin for 10 years. Doing Bitcoin meetups, most of them for free. We had stickers with address for donation. People were coming, learning, buying BTC. One of our co-founders was asking people if they got some value and donated (more on the problematic use of this word below). Again, these were people that maybe doubled their wealth... Once, the answer was \"I bought a 'club mate' to support you\". So the founder ran a calculator app on their phone. It went something like this: A club mate costs 3$. Our margin is 20% (and that's gross margin), so $0.6. Rent of this place, with energies is let's say $100 for the meetup. There are people at the bar, someone doing the talk and few people helping to onboard people. So that's let's say $200 in wages. Not even saying that we pay rent and people to create these events, promote them, so people know about them. Let's say a real cost of the event is around $500 (very conservative estimate). So that would mean people would have to buy 833 club mates just for break-even. Do you think this math works?\n\nWhile we _technically_ could be financed from people (the QR codes worked), people chose to drink sweet mate drink and thought they were supporting content creators.\n\nI think this is the same case with Nostr zaps and value4value. Let's start with podcast. Studio rent - $100 per hour. So for 2 hour podcast, you need 3 hours: $300. You need some hardware, let's say capital is $30 per episode. The podcaster needs to film it (3 hours), edit, upload and promote it (let's say 2 hours). 5 hours at $50/hour = $250. So a single podcast episode is $550. A 5000 sat boost is $1.3 now. So you need 423 boosts just to break even.\n\nIs it technically possible to get 423 boosts of 5000 sats on your podcast? Of course. Does it happen? Not much. Most listeners don't even know how to boost. So unless you do a Bitcoin-focused podcast, or have a specific audience, you are unlikely to break-even. (if people stream 100sats/min, then for 2 hour podcasts, you need 174 people streaming the whole podcast).\n\nLet's talk about blogs. I won't bother you with math, but writing an article takes time. Then you need to create images, promote it, ...\n\nIf we want to move away from advertising, for both podcasts and text content, the technology is here. But it's unlikely to work in practice any time soon. \n\nHow do people make money now? They share a referral link to some product or service (unfortunately, very often some KYC bullshit). It gives listeners discount and the content creator 10%-20% of the value. If the product is $100 value, it's $10 per purchase. Will 55 people buy to cover the cost? Not so easy, but if you have a few thousands listeners, it is not unlikely.\n\nIf the product is yours, it is just a marketing strategy. I get more than 10% if I sell my book or course, there are still costs, but that's the way to support it.\n\nI am not complaining - we have complete control in what we produce, how we share it and what our business model is. What I am saying, that 100-1000 sat zaps is not \"paying for content creators\", at least not anytime soon. I still love the feature, it creates a flow of value, is a form of feedback and it's beautiful. So keep zapping. But when you get value from some content, don't fool yourself that your $0.2 is \"paying for the value\".\n\nWhat about the donations? Roy from Breez said something really nice at BTCPrague - don't ask for donation, because you will get a donation. If the blog post / podcast gives you $10 in value, give $10. Ask for people to add a price tag to the value people received and pay that. What was the value of learning about Bitcoin in Paralelni Polis and doubling your wealth? I can tell you what it's not - drinking a club mate. Plus it has tons of sugar.\n\nhttps://juraj.bednar.io/en/blog-en/2021/06/14/financing-content-creators-and-pocasting-2-0/",
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