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Facebook wants up to 30% of fan subscriptions vs Patreon’s 5%
- skilled 8y agoDamn, if Facebook actually had a face, it would be quite punchable I must say...
- avinium 8y agoBest description I've ever heard of the company.
- gnicholas 8y agoHow is this a "Patreon killer" at all? In addition to the extra 25% cut, they will also apparently demand IP rights that would continue even after you stop using their service. Are they thinking that people will sign up for this because it gives them instant access to lots of people on FB, and that justifies the higher percentage? I'm guessing that creators will end up having to pay to get exposure, just like brands, which nullifies this potential benefit.
- vntok 8y ago> By posting content to Patreon you grant us a royalty-free, perpetual, irrevocable, non-exclusive, sublicensable, worldwide license to use, reproduce, distribute, perform, publicly display or prepare derivative works of your content. "Perpetual and irrevocable" means that it continues even after you stop using their service.
- black_puppydog 8y agoWith the difference that much of what "happens" on patreon is not actually hosted there, and thus doesn't fall under that clause if I understand this correctly.
- rchaud 8y agoYeah but I would imagine Patreon is working towards introducing their own video hosting platform at some point and build out their moat. Otherwise they're a glorified Paypal button.
- zone411 8y agoI think it would make the most sense for creators to have accounts on both Patreon and Facebook.
- michaelmrose 8y agoAlternatively you could pay to promote your work on facebook which you will have to do anyway and take payment on patreon.
- AstralStorm 8y agoWhich will be promptly banned and your Facebook privileges revoked. Like YouTube tries to. Welcome to walled gardens.
- SmellyGeekBoy 8y agoWhat? Facebook will happily take your money to advertise pretty much anything and everything, it doesn't matter where the payment is eventually taken.
- michaelmrose 8y agoWhich is a great reason for everyone to get off facebook asap.
- astrodust 8y agoOh, they'll kill Patreon by deprioritizing Patreon links in user feeds.
- liability 8y agoThis seems like the sort of thing that could only move forward at a company like Facebook. If this were proposed as an independent business, it would be laughed out of the room. Of course Facebook has enough loyal users that they might actually be able to make this work..
- moonrobin 8y agoIt's interesting what happens when there's such a massive user base when Pateron's entire user base (~5M pledges) is less than a fraction of a percentage of FB's users. Albeit the rate of conversion is taken out of account, but we're still talking about differences in orders of magnitude.
- vntok 8y agoWhy would it be laughed out of the room? FYI, here's the current top comment in this very thread: > 30% is the same cut that Apple and Google take for everything that goes through their app stores, including all in-app purchases. It's the same cut that Steam takes. It's the same cut that YouTube takes for channel membership. Twitch takes an even larger cut: 50% from subscriptions. It's extremely well-established that people are comfortable with platforms taking that large of a portion.
- AlexandrB 8y agoBecause a new company would have nothing to offer for that 30% that Patreon doesn't have. Facebook has an audience.
- hereiskkb 8y agoTo actually see content creators sign up for this would be a sign of the times.
- davesque 8y agoIndeed. It's sadly not that hard to imagine them doing it.
- luckylion 8y agoWell, Facebook has somewhat transparent guidelines for banning, and will be held accountable in public if they overstep. Patreon doesn't, your business with them as a creator is as safe as it is with PayPal if you're putting out controversial content.
- ttsda 8y agoTransparent? Never heard of zucc?
- davesque 8y agoSometimes, I feel like the Facebook hate train is just too much and then stuff like this comes along.
- headsoup 8y agoSo Facebook are essentially like an email spam operator here. They have billions of targets (customers), so only have to find a small number of suckers (customer sub-set) to make it profitable. No doubt you'll need to sign up to Facebook to even view the content, so I'm out then.
- Deimorz 8y agoI don't understand why people are acting like this is ridiculous and will obviously fail. 30% is the same cut that Apple and Google take for everything that goes through their app stores, including all in-app purchases. It's the same cut that Steam takes. It's the same cut that YouTube takes for channel membership. Twitch takes an even larger cut: 50% from subscriptions. It's extremely well-established that people are comfortable with platforms taking that large of a portion. Patreon is the outlier, and they're dropping hints now that it probably isn't going to last: https://www.cnbc.com/2019/01/23/crowd-funding-platform-patreon-announces-it-will-pay-out-half-a-billion-dollars-to-content-creators-in-2019.html https://www.cnbc.com/2019/01/23/crowd-funding-platform-patre...
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- ardy42 8y agoThose cuts are egregiously large, IMHO. Those platforms should be hacked into pieces until competition forces them to fall (or have their pricing regulated like a utility's).
- vntok 8y agoTheir billion users seem pretty content to use them in spite of the numerous alternatives.
- chillacy 8y agoI have a mac app which is exclusively available on the App Store, so I pay 30% of my revenue to Apple. I could spin up my own system but then I have to build out payments (credit card processing fees), distribution, updates, beta testing, and figure out discoverability. In the end, my app isn't big enough to build these things out myself, but at least if I wanted to I could. Different story on iOS.
- maksimum 8y ago> beta testing, and figure out discoverability I feel like these two are much harder than the others. How does the app store help you with beta testing? Isn't discoverability basically a lottery?
- SatvikBeri 8y agoPatreon is selling a service, Facebook is selling access to an audience. Two seemingly similar but vastly different offerings. That's why Facebook can have a lot of crappier versions of other products that are still successful (e.g. Facebook events vs. Meetup.) I doubt they'll be able to get away with the terms as is, but it wouldn't surprise me if they manage to successfully charge significantly more than Patreon and still get a lot of customers.
- jraby3 8y agoAbsolutely correct and the best comment here imo. It’s very different to provide an audience vs. providing a service.
- mamborambo 8y agoBut pas
- mamborambo 8y agoBut once past initial audience discovery, the recurrent billing of patronage donations is just pure service. So logically creators should only use FB for access to new audience, build a relationship with the newly acquired audience, and pivot to direct billing or Patreon for recurrent collection.
- pavlov 8y agoBy the same logic, YouTube creators should only use YT to build an audience, then switch to hosting their own videos. Yet they want to remain on the platform.
- stale2002 8y agoVideo hosting costs a lot of money. Sending an API request, to the credit card company, to bill the monthly payment, does not cost a lot of money. Getting your audience to switch platforms for the monthly payments is a compartively easy thing to do, compared to setting up your own video hosting site.
- networkimprov 8y agoThis could be a huge boost for Patreon. A significant fraction of creators will seek alternatives when they hear about the FB product, or after being burned by it.
- luckylion 8y agoThe problem isn't in on the creator side, it's getting users to go, sign up and pledge. FB already has the users, it just needs to give them an option to sign up. Twitch streamers also use Patreon, but subscriptions and cheers on Twitch are more successful from what I can tell - it's closer to the content. If somebody is using FB as the primary way to release content, it's only natural to also do the donations/subscriptions on FB.
- networkimprov 8y agoI'd expect high-end buyers (who typically account for a large majority of the total market) would follow the creators to Patreon if it's creator community expands rapidly.
- DesiLurker 8y agothere is no way in hell I am giving FB my credit card number. Idont need to give them another avenue to track me offline.
- RileyJames 8y ago> But whatever cut it takes will be after processing fees and the 15 to 30 percent tax Apple and Google levy on iOS and Android in-app purchases. We’ll see if Facebook tries a workaround that pushes users to their mobile browser where it can take their subscription money tax-free. That makes it kinda ridiculous. $5 subscription. 30% to Apple: $1.5 30% to Facebook: $1.05 (of the remaining $3.50) Leaving the creator with: $2.45 I assume it will be out of control of the content creator regarding how the subscriber chooses to pay/subscribe, so the margins could be all over the place.
- thucydidesofusa 8y agoHeh, now assume the creator makes $80k/yr and lives in California. Marginal tax rate - ~38%? $5 subscription. 30% to Apple: $1.5 30% to Facebook: $1.05 (of the remaining $3.50) 38% to the Government: $.93 (of the remaining $2.45) Leaving the creator with: $1.52
- michaelmrose 8y ago50% further for housing and 15% for healthcare enjoy your 53 cents.
- imtringued 8y agoRent doesn't increase if you personally earn more money. (only if everyone around you earns more money too.)
- randunel 8y ago> 38% to the Government: $.93 (of the remaining $2.45) If the invoice you give your customer says "$5.00", isn't the tax taken from that? That's how things work in Europe, the gross income is taxed.
- deelowe 8y agoThe US taxes sales twice. You get taxed on the sale itself, which is the scenario you describe. Then you get taxed on your income at the end of the year, which is the "38% marginal" rate being described here.
- agigao 8y agoI miss those times when enthusiasm used to drive the net. Seeking profit in every corner of one’s life is demoralizing to say at least.
- michaelmrose 8y agoMost regular people call this behavior... survival. Anything else is an extreme luxury reserved for a minuscule fraction of the human race.
- dingaling 8y agoThat mindset is only necessary if you intend the Internet to be your sole income. I work a tiring manual job for three days to pay bills and buy nice things. The rest of the week I have some time to take photos and write other content which I share freely online. I don't expect or demand that anyone else pay for my hobbies.
- erikpukinskis 8y agoNo, not really. And do the extent people do live that way, it’s a new phenomenon. A hundred years ago most people had vast swaths of their productive life that operated outside of the economy. Housewives cooking meals, people fixing their own cars. Dances in barns. Etc. Many “regular” people still live that way, which is where your statement is false. Over the last 100 years there has been a concerted effort by business owners to displace all of that activity and replace it with productized equivalents in the economy: You don’t cook, you buy frozen dinners. You pay to have your complicated car fixed. You don’t walk your friends dog, you get paid to do dog walking gigs. You gramma doesn’t cook you soup, you get it delivered. People don’t meet up in a barn, you go to a club and pay a cover. This is new. And I’m not even saying it’s fundamentally bad for us. But for some of us it is disorienting.
- michaelmrose 8y agoBecause the non discretionary parts of your life like rent/mortgage and medical is so expensive people don't have time after investing 50-60 hours to walk the friends dog. Note that someone who only works 40 hours but has to commute 1.5 hours to and from work because they can't live in the city where the jobs are and spends 2 hours taking text emails while not actually at work has committed 65.5 hours of their time. half hour getting ready for work, 1.5 hours driving there, 4 hours on lunch for an hour, 4 hours on, 1.5 hours getting home. People working multiple part time jobs are worse off. They may be "working" 60 hours and committing 80.
- aaronbrethorst 8y agoI wonder if Facebook will be able to pay content creators on time. Might be worth a significant drop in revenue to some folks who depend on services like Patreon in order to pay rent if they're able to at least get their money when they're supposed to get it. https://twitter.com/ericacbarnett/status/1100809443422302208 https://twitter.com/ericacbarnett/status/1100809443422302208
- kkarakk 8y agoEveryone arguing against this is forgetting that this is FACEBOOK, premier social network on the planet. sure it's unhip to actually use it for networking now but everyone and their mum is still maintaining a presence on it(no the vaunted snapchat only teens don't count, they have secret facebook accounts linked to none of their peers to participate with their selfsame anonymized peers in meme pages on facebook) all they'd have to do for this to be successful is to make reach for partnered pages the same as it used to be before they limited it. there are pages with 1million followers who have a reach of 10-100k right now coz of the new rules.imagine if facebook said "partner and you get 1 million back".
- jelv 8y agoLiberapay takes 0% https://liberapay.com/ https://liberapay.com/ It's European non-profit and open source. It's funded by the donation on it's own platform.
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- nspkr 8y agoVery careful with this option, as it's based in the EU which means free speech is not considered; that makes it a very dangerous option for podcast and youtube creators, opinion bloggers, etc.
- DuckyC 8y agoAre you saying that there isn't free speech in the EU? What are you basing this statement on?
- nspkr 8y agoMany countries in the EU have blasphemy laws and the European Court of Human Rights says they are okay: https://www.theatlantic.com/ideas/archive/2018/10/its-not-free-speech-criticize-muhammad-echr-ruled/574174/ https://www.theatlantic.com/ideas/archive/2018/10/its-not-fr... If someone criticised Jesus Christ in their podcast (for example), they would be putting Liberapay at risk. I don't believe Liberapay would allow that, so they'd just ban the user. That's what makes Liberapay a risky option.
- rjtavares 8y agoThat's quite different from "free speech is not considered". Every country has free speech exceptions: for example, in the USA "there are several common-law exceptions, including obscenity,defamation,incitement to riot or imminent lawless action,fighting words,fraud, speech covered by copyright, and speech integral to criminal conduct" In th EU: > The Charter of Fundamental Rights of the European Union has been legally binding since December 1, 2009 when the Treaty of Lisbon became fully ratified and effective. Article 11 of the Charter, in part mirroring the language of the Universal Declaration of Human Rights and the European Convention on Human Rights, provides that > 1. Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers. > 2. The freedom and pluralism of the media shall be respected. The European Court of Justice takes into account both the Charter and the Convention when making its rulings. According to the Treaty of Lisbon, the European Union accedes to the European Convention as an entity in its own right, making the Convention binding not only on the governments of the member states but also on the supranational institutions of the EU. So, is speech in USA "freer" than in the EU? Yes. But in both cases free speech is recognized as a right. https://en.wikipedia.org/wiki/Freedom_of_speech_by_country https://en.wikipedia.org/wiki/Freedom_of_speech_by_country
- sofaofthedamned 8y agoAm I being paranoid that, by collecting CC numbers, Facebook will then use that to share data with retailers to collect the precise purchase history of a user?
- tdeck 8y agoYou mean like this product Facebook already has? https://www.facebook.com/business/help/1278167592274041 https://www.facebook.com/business/help/1278167592274041 I'd say not that paranoid.
- thiagocsf 8y agoNo, you’re not. I can’t give details but I was working on this 4 years ago in SF. Major shopping centre corporation.
- hokus 8y agoIts nice to see the multinationals agree 30% is a decent taxation level.
- ebalit 8y agoEven 30% of the revenue, while most taxation is based on the profits only.
- Asooka 8y agoThey've learned their lesson - taxing profits means everyone will pull off bullshit accounting tricks to make their profits as close to 0 as possible.
- ardy42 8y agoThe US government just needs to rebrand itself as an app store & platform, and we'd be done with all this controversy around tax rates.
- DanielBMarkham 8y agoI remember when reasonably smart cellphones first came out. You could hook them up over USB and change things like ringtones or backgrounds. It was fun. Then manufacturers and cell phone companies started realizing the money train they were on. They made billions by selling this same crap to people who didn't know how or have the time to customize their own phone. As it turns out, billions of dollars tends to get people's attention. Now those same companies are locking down PC boots, taking out headphone jacks, and all sorts of other things to "help" us have better computers. Each of them will involve trying to keep those cash cows lying around, maybe grow the herd a bit. My point is this: smart people caught on to this bullshit. Facebook, Patreon, and the other fan/audience aggregation systems are doing the same thing, just with a different platform. I'm not sure, but I think the folks are catching on faster this time around. We're going to end up with an internet where the tech elite use services that actually facilitate their lives while the rest of the world use various subscription and "helper" services that try to extract as much money as possible from them at every turn.
- Can_Not 8y agoWe're leaving capitalism to enter into a new type of society. Rentierism. Everything is already owned. It's like feudalism, but you can have as many feudal lords as you want to live under--as a service.
- rchaud 8y agoShould coincide with a new technological paradigm in on-demand labour contracting. They should give it a catchy name, like VaaS: Vassal as a Service.
- DanielBMarkham 8y agoYou know, renting out by the hour the right for services to give you free stuff and vie for your attention span might actually work. E-gads we live in a weird world
- 0xcde4c3db 8y ago
- oliwarner 8y agoSteam takes 30%. Apple, Google Play take 30%. Physical stores can eat 60% unless you're selling something that's demonstrably saleable. Those sorts of markups aren't at all weird for access to a market... And that's what it is, as SatvikBeri has already said. People typically don't go to Patreon to find new content. They consume the content elsewhere (YouTube, Facebook, etc) and then go to Patreon. Facebook et al are packaging together a huge userbase as well as a very targeted marketing service amounts. In the big scheme of things —because I'm sure some people do browse— Patreon is just the money processor. Edit: Should also point out that YouTube has a similar system. Users can pay 100K-sub channels a fixed £4.99/month and Google keeps 30%. It's all about the point of contact. YouTube, Facebook, established app markets, etc all have near-monopoly access to people. That's why they can demand the big bucks.
- pluma 8y agoIt's a bit more complicated, which is why many content producers still use Patreon even if they want an alternative. Patreon not only collects money, it also provides a way to assign rewards, define goals and notify patrons (filtered by reward level) of new content. It's not a publishing platform, but it's not just a payment processor, it's also a kind of marketing platform. That said, the most appalling part of Facebook's "competitor" is not the 30% rate, it's that their ToS try to pull the same bullshit stunt they try to pull on their social platform: tricking you into believing you owe them perpetual transferable rights to everything you share via their platform. They know this isn't actually enforceable (at least not in all jurisdictions internationally) but they still try to trick people into believing they unknowingly agreed to it and are comfortable exploiting those in jurisdictions where this nonsense works and those who don't know any better.
- buboard 8y agoYou need to take into account that fan subscriptions are a miniscule percentage of the overall user base. It's not like an app store where a whopping 1/3 of users buy apps. Just because facebook has a larger userbase it doesn't mean people are going to use it "out of convenience". If creators don't see a financial advantage , they 'll redirect their sponsors to patreon or another cheaper medium.
- andrestc 8y ago"The policy document attained by TechCrunch shows Facebook plans to take up to a 30 percent cut of subscription revenue minus fees, compared to 5 percent by Patreon, 30 percent by YouTube, which covers fees and 50 percent by Twitch." Looks on par with other providers.
- mnort9 8y agoFB is charging a premium for accessing an economy of scale (audience). As a content creator that charges $25/mth, would you rather: 1. Patreon - 500 subs 25x500x.95=$12,500 rev 2. FB - 5K subs 25x5000x.70=$87,500 rev 10x growth doesn't seem unrealistic given FB's scale and $$ motivation to grow your audience
- AlexandrB 8y agoThis is great news! Hopefully it will keep Facebook's Fan Subscriptions from becoming popular.
- calimac 8y agoThink for a second, what income tax did Facebook pay last year? What is the actual after the creator pays the commission to Facebook then pays their personal income tax on it what is the creators net net profit? I would boycott Facebook payments
- quadrangle 8y agoGeez, none of the comments here mention surveillance! That's the ONLY focus Facebook really has. The point of this is OBVIOUSLY not just profit, it's about figuring out how to get more and more stuff to live in Facebook, be run by Facebook, and tracked by Facebook. Zuck and Sandberg can't tolerate the idea that people are donating to things and they don't know about it. They want to know who donates to what and all the other details. And they'd like to eliminate the existence of any content that's outside of the Facebook ecosystem.