The reverse business model

I’ve been championing for a while what I call the ‘reverse business model’, so I’m glad to see it applied more and more often – most recently in a deal struck between Google and Mozilla, securing significant funding for the browser developer in return for making (keeping) Google as the default search engine.

In short, the reverse business model is about charging the service/product provider, instead of the end consumer: instead of having an end user pay for a service, charge the original service provider for it, this way making sure the end user gets (the appearance of) a ‘free’ service (of course, at the end, he will pay up – but through a different channel). Examples of this model include charging web sites for premium connectivity from the end user (say hi to non-neutral net) or charging companies using social network sites such as Facebook – see my post about monetizing social networks. Google’s deal with Mozilla falls clearly into this category, making sure that Firefox’s users will use Google instead of Bing or Yahoo.

Will this model prevail for web based services? I believe it’s the only way for monetizing some of the most popular on-line services, such as social network sites; incidentally, it’s one of the ways e.g. operators can monetize over the top delivery of web and cloud services.

But more about that in another post.

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