Revenue Share vs. Breakage: Calculating the Publisher's Cut in Subscription Services
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The aggregator in this model assumes significant risk. In a scenario in which most subscribers furiously read up to 10% of many, many titles, the publisher payouts may well exceed total subscription revenues raised. On the other hand, if subscribers to such services are truly "casual" readers and stay safely below the threshold, then the aggregator would end up paying few publisher bounties and generating a very healthy margin.
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Andrew Brenneman
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