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As you browsed the World Wide Web, you would have certainly encountered the infamous ‘404 error’, signifying that a web page is ‘not found’. What you have not seen is a similar code 402, which stands for ‘payment required’. This was the piece that Tim Berners-Lee and his team left unfinished when they were fashioning the web decades ago. The original intention was that every visitor must pay something to view a web page, but the schema was never built, and even now, there is no standardized encoded way to send or receive money online.

The fact is that ‘user-pays’ was never the business model of the web. Initially, most of it was free. Then, Yahoo and others scaled up publishing and advertising as a business model, which Google and Facebook took to another level. Besides ‘advertiser-pays’, another business model started taking shape—that of commerce, which Amazon began to dominate. Of late, we have begun revisiting the payments and commerce business model again. The reason: All of advertising is $470 billion a year, e-commerce is 10 times, at $5 trillion, albeit with thinner margins. E-commerce makes up about 18% of the overall retail market and is growing fast.

Companies like Square, Paypal and platforms like the Unified Payments Interface (UPI) in India are building the online payments infrastructure to address the original 402 error. But the company that’s making it as simple as Berners-Lee perhaps envisaged is the San Francisco-based Stripe. It burst into prominence with its latest funding round that valued it at $95 billion, making it the most valuable unlisted private company ever. With its ambitious mission statement to ‘increase the GDP of the Internet’, it heralds a far more dramatic shift in the business model of the World Wide Web—from advertising to payments and subscriptions. The signs have been there. The ‘techlash’ against rampant data monetization and its impact on privacy is the most prominent. Facebook has added shopping tabs on Instagram, started payments on WhatsApp in India and Brazil, and even debuted its own cryptocurrency. Twitter is testing a way for users to charge for content, TikTok is treading into e-commerce via a partnership with Shopify.

But nothing signifies this titanic shift as the rapid rise of what is being called the ‘creator’ or ‘passion economy’. This concept, of enabling people with an online following to make money from sales, was initially popularized in China. Then came Twitch, which did this in gaming; Patreon, which enabled crowdfunding for artists; and then Substack, which helps writers monetize their blogs. The pioneer, though, was perhaps YouTube, with kids in the US three times more likely to want to become YouTubers than astronauts.

The term was introduced in a seminal blog post, The Passion Economy and the Future of Work, by Li Jin of Andreesen Horowitz, in which she talked about how this trend will shift the current mass standardization to “monetizing individuality". Venture Capital firm SignalFire says that this new ‘economy’ has as many as 50 million creators, of which 2 million are making more than $100,000 a year. Covid has turbocharged this economy. Etsy, an original creator economy company that lets individuals sell artisanal objects, had $346 million in mask sales. It was in 2006 that Chris Anderson predicted this trend in his book, The Long Tail. His thesis was that products in low demand can collectively equal the market share of blockbuster rivals: “When the tools of production are available to everyone, everyone becomes a producer." Fifteen years later, his prophecy is coming true.

Small live streams on Twitch compete with the Oscars. OnlyFans users pay for niche conversations and viewings of individuals, rather than watch blockbusters. YouTube has 30 million channels, with those earning over $10,000 growing at 40%. The top 10 authors on Substack collectively make over $15 million per year. The top content creator on Podia makes more than $100,000 a month. NFTs or non-fungible tokens, which help digital artists monetize their offerings, are one more offshoot of the creator economy, which is rising in India too, with startups like GoSocial creating platforms that help artists monetize their wares. The ‘long tail’ is getting longer and rewarding.

“In the future, everyone will be world-famous for 15 minutes," said Andy Warhol in a 1968 exhibition of his work at the Moderna Museet in Stockholm. What he did not foretell was that everyone’s fame would be experienced concurrently and monetized so well.

Jaspreet Bindra is the author of ‘The Tech Whisperer’, and founder of Digital Matters

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