Sunday, May 17, 2015

Explaining the HubPages Business Model

Once you examine the HubPages Terms of Use in detail, it's completely understandable why Robin Edmondson would want to invest time and resources into programs like HubPro and Editor's Choice.

Instead of removing low quality content from the site, it's far more enticing to "tweak" content that gets the most traffic.

Especially if you get to keep 100% of anything that content earns (ad share, Amazon, and eBay royalties).

What could be better than profiting off the backs of others and their hard work?

So when "active" authors are baffled why HubPages ignores the content they flag, I say to them this:

"HubPages needs to split the profits with you, right? The pages that you flag (that do not get removed) are probably pages that HubPages keeps 100% of the revenue from."

In my article HubPages: The Truth Behind Editor's Choice, I go into greater detail about why the HubPages domain is lousy.

But conservatively speaking (and based on their biased statistics), I came up with a couple of diagrams that might help you understand the scope of how HubPages makes most of their money.

In this first pie chart, I estimated that half of all the "registered" users on HubPages were "inactive" by HubPages standards. Marina Lazarevi, Product and Quality Manager of HubPages, stated: "The reality is, the EC opt-out rate is only 3%."

And I believe she's being truthful.

Especially in light of the fact that the majority of the pages on HubPages are by "inactive" users or those producing low-quality work or those who are completely unaware that they need to opt-out.

Here's my pie chart to illustrate the 3% who opted-out of Editor's Choice:

Next, let's take a look at Paul Edmondson's logic. He stated: "...the top 19% of hubs by quality account for 30% of traffic" and also "We've actually edited 20% of traffic from search engines."

Sure, I believe him.

So, let's apply that logic to another diagram. This time, I divided those getting paid and those not getting paid on HubPages. It's easy to see how much content should probably be removed from HubPages, but isn't.

Instead, I think HubPages has been dying to get their hands on the "abandoned" content (or in my case) the content they imported without permission from Squidoo authors.

This is the business model you never hear about. The one that you need to know and the one that is bound to fail. As more "active" authors leave the site, the HubPages domain becomes more tarnished.

It's funny how greed eventually catches up with people, isn't it?

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