Getting Paid: AVS vs. Pay Site, Part 1
A recent thread was started by PED on XBiz' popular Cosmic Village message board, asking whether it was better to use an AVS system or a 3d party processor such as ibill. Since I have personally used AVS systems as well as ibill, I had some definite opinions on the subject, which I shared. But it got me thinking:
It has been the subject of much heated debate and much digital ink: "Should I build an AVS or a pay site?" Being a question typically asked by a newbie, the answer is (or was) always easy: "Forget pay sites, they're too expensive to operate. Build AVS sites, and when you can afford one, maybe then you can try a pay site." Conventional wisdom dictated that pay sites were the fastest way to lose money in this business, and that building a network of free and / or AVS sites to send traffic to a sponsor was the key to success; but does this "wisdom" still hold true?
The AVS Advantage
For those who are still unfamiliar with them, AVS sites are simply adult web sites that make use of one of the increasing number of Age Verification Services such as CyberAge.com or SexKey. The logical 'next step' for newbies and traditional 'free site' Webmasters, they have been my standard, recommended vehicle for adult site profit and protection since as far back as 1996 (if memory serves me). Functioning as a 'miniature pay site' with many of the benefits and few of the drawbacks of their full-blown brethren, AVS sites provide fertile learning grounds for aspiring professional Webmasters.
Like everything else in our growing business, AVS sites and services have evolved. While many of their past attractions are no longer as compelling to me as they once were, having been a bit diluted and refocused so that their benefits shift ever more to the AVS system and away from the participating Webmasters, I still believe that they are a necessary step in the evolution, growth, and training of today's adult Webmaster. Having said this, the basic appeal of using an AVS system has remained the same:
• AVS sites allow you to 'sometimes' charge for admission
• AVS sites provide you a certain degree of legal protection
• You can 'sometimes' get high-quality traffic from the AVS link list
• The number of sites the surfer can choose from is a major selling point
On the other hand, the 'sometimes' admission charge is coupled with the 'number of sites' selling point, so if the surfer ALREADY has a membership purchased from a competing site, he gets into YOURS for FREE! With some popular AVS' claiming to be approaching the 'million site mark,' do you really want to have a million competitors providing FREE access to YOUR site? This is something that AVS site detractors will frequently cite, but as many of these detractors are 'free site' Webmaster's who provide EVERYONE with free access to their content, the logic of their argument escapes me.
While I would personally welcome a million other sites sending me traffic, not everyone is able to handle such a volume, and their resulting bandwidth expense might make it a losing proposition rather than a profitable blessing from above. This leads me into the much touted 'benefit' of the traffic you can receive from the AVS' own directory. This high-quality link list traffic is diluted by the huge number of listed sites, and the linking requirements are getting ever stricter; and some of those requirements make it harder for you to profit, having been designed to benefit the AVS system more than they do the participating Webmaster.
Having said that, operating your own pay site provides you with as much legal protection as does an AVS, and you will sacrifice the perceived benefit of AVS link list traffic and the selling point of access to 100s of 1,000s of sites with one low membership fee. NOW, if you could figure out how to do BOTH, building a network of AVS sites that exploits their benefits, and then up-selling to your own (rather than a sponsor's), pay site, you could have the best of both worlds...
The Issue of 'Legal Protection'
An interesting issue: AVS sites do provide a degree of legal protection (here in the United States anyway), as they are one method 'approved by Congress' for showing Webmaster's 'good faith effort' to keep minors away from any 'potentially harmful materials.' The vehicle for doing this is through a credit card transaction — the same as is done through a pay site via ibill, et al, hence my statement concerning pay sites: "operating your own pay site provides you with as much legal protection as does an AVS."
One interesting aspect of age verification through a credit card transaction is the argument made about the validity of the process, since "minor's can have credit cards." Counterpoint to this is the fact that the credit card company's 'fine print' which must be signed prior to issuance and card activation, generally states that all of the purchases a minor makes must be supervised by, and the responsibility of, a co-signing parent or legal guardian. Any CC transaction that a minor makes WITHOUT this parental consent, such as joining a porn site, is a violation of the CCs Terms & Conditions, and grounds for cancellation of the account. In any case, this amounts to fraud committed against the site operator, and still validates his or her due diligence and good faith should an irate parent try to encourage prosecution against you for tainting little Johnny with pictures of naked women. In either case, whether you use an AVS or another mechanism for processing a credit card transaction, you are gaining as much protection as you can.
Also, since most proper pay site's T&C cover such fraudulent use, there is grounds for legal relief, especially if a charge-back was issued. Then the case becomes one of 'you're out $30, how much of your time and money do you want to spend in small claims court to get it back?' Better to just suck on your loss as a cost of doing business...
A further point that I find most bemusing, and won't comment on further here, is that despite Congress' decree of their acceptance of credit card transactions for the purposes of age verification (as stated in the various incarnations of COPA et al), the credit card companies themselves (MC / VISA) state outright that their services are NOT to be used for age verification. In either case, whether you use an AVS or another mechanism for processing a credit card transaction, you are gaining as much protection as you can.
As you can see, there are advantages and disadvantages to using AVS systems, but the traditional benefits are changing, just as the dynamics of our industry are changing, and this requires a constant re-evaluation of the pros and cons. Stay tuned for the next installment which will look at some of the pros and cons of pay sites. ~ Stephen