Happy new year to all. This is my new year present to all of you.
In this thread I will explain you how a sucessfull tube site is ran and will detail you all the costs. Unlike you may think, the costs are much less than starting a paysite and at the moment they are more profitable.
This is about a real tube like youporn.com and not some pseudo tube running a sponsor feeded crap.
First of all, to run a tube site you need lots of bandwidth and a custom made CMS. You don't need lots of servers, but it all depends on how much bw you have per server. This is the "hardest" part to get because we all know that servers and bw cost alot... WRONG.
Negotiating at datacenter level skipping the hosting comany or reseller drops the prices to near $2500 per 1 Gbit of unmetered line. Some of you pay near $2000 for 100 Mbit unmetered servers. The catch is that the datacenter will require a long term contract (one year or so) guaranteing you will burn at least 1 - 5 Gbit/sec nonstop. Some datacenters may even give you the bw for free as long as you maintain data flow rates with given countries or providers.
How does the datacenter profit from that?
Datacenters have peerings with bw carriers. Some big carriers require BIG amounts of data flow to make direct peering with you. For example, some euro countries main carriers require a minimum of 4 - 10 Gbit traffic with them to make direct peering with a datacenter directly.
Having direct peering in a datacenter with some country main carrier means only one thing for that datacenter. They can get BIG company clients from that country that pay the big money. So they are more than happy to give $50.000 worth of traffic to a tube site owner for free as long as he guarantees a traffic flow for direct peering with some carriers that allows them to get 10 clients paying $350.000 each one ($3.450.000 profit for the datacenter from this operation).
Servers can be rented or bought, the price for one - two years operative is practically the same. Of course, when you buy or lease 50 - 100 servers from Dell or HP prices get ridiculously low. Since the BW is free or almost free servers are also not a problem.
For now, assuming you have to pay the bw and the servers, a 1 Gbit burning tube site with about 500 - 1.000 GB worth of content would cost between $1.000 and $4.000 per month as much in server expenses.
Now time comes for the content encoding. You can compile ffmpeg with flv support and tune it with a good UNIX nice priority, so the content can be encoded on every server without distrbing the web servervice operation. This saves you lots of money and admin time in running separate servers for encoding the content.
I personally use other content encoding solution, but it's because I don't like ffmpeg. Mine is paid, so it costs a bit in software licenses.
Now the content costs. Most of you think content may cost alot. I suggest you to visit Venus instead of the big Bro shows this year. You can license content with Internet rights at really good prices there. One of my coworkers licensed 150 asian DVDs for 1 euro per title (about 1 dollar and 40 cents). They are putting these titles on the local TVs at the moment.
As long as you produce or buy content in bulk the prices drop alot.
Of course, some tubes steal the content, but most of the time it's not worth to do it because downloading time costs (the action of stealing the content) costs more money in time consumed than licensing the content directly from the producer. Since content exclusivity is not mandatory for a tube site, the prices can go really low. Populating a tube site with 200 - 500 full DVD titles may cost between $1.500 and $10.000 depending on niche and quality. Of course, in this case you must completely skip the reseller and deal directly with the producer or the main reseller at least.
Now comes the CMS stuff. You will need a custom coded one that can cluster the content between different servers and manage server failures when some server goes down, so your site can handle graciously server hardware or software failures. A good coded CMS will give you a very robust cluster that could even handle an entire datacenter failure if it's spread between two or more datacenters. This stability is not possible to achieve with a normal paysite because the servers costs would be not worth it unless it's a very big paysite.
A good coder could make you such a CMS between $5.000 and $10.000. It can be coded in 3 days. I coded mine in less than a day and had another day of planning all the possible failure points and ways to work around them (2 days of work in total).
So, the startup costs are the following:
$10.000 for CMS
$10.000 for content
$3.000 for bandwidth and servers
Then it's about $3.000 per month while driving a several million uniques/day. If the datacenter gives you the bw for free, then you only have to face the CMS and the content costs.
The maintainance of a tube site is practically nothing if your CMS handles server failures properly. As long as it can handle 20% of your servers being shutdown without disrupting operation it's ok. With 30 servers a tube cluster can encode between 40 and 80 DVDs per day, so content encoding is not a problem at all. With a good data replication protocol the same content would be spread between at least 4 servers, so server failure or bw saturation would not be a problem at all.
The startup cost of a 100% legal tube site would be in this case about a month of work and $25.000 if you have enough traffic to feed it from day one to burn about 1 Gbit of line and want to have lots of content on it. You can start a small one for less than $5.000.
Is it worth it? Yes, it is.
How do I know it? I run two such tube sites.
How is this traffic monetized?
It converts relatively good, for some things, better than TGP traffic or even blogs. If you run a subsidiary network of your own sites you can use data mining techniques to create a BIG user database that can be sold later for millions or used for targeted advertisement on audiences.
Some other day I will tell you how to produce exclusive or semi exclusive content at really low cost or no cost at all.
Happy new year
