Delivering Value
Pardon the interruption into Tommy’s wonderful blog, of which we have received very positive feedback thus far. Thanks to Tommy for spending the time to update everyone on the exciting developments at Nexicon.
The question on many people’s mind these days goes something like, “This is all very exciting and the future looks incredibly bright, but how again does Nexicon make money from all of this?” I will answer the comment that was asked in this post.
As much as we would like, Nexicon is not yet ready to release 2009’s earnings forecast. Yes, we have a 2009 revenue forecast, one that I obsessively tinker with and manage on a daily basis. There are aspects which are fluid, as various initiatives take shape each day. As soon as our executive team and advisory board have finalized, we will make this information available to the public.
With respect to the question about how Nexicon will drive revenue, let me first say this. Prior to joining Nexicon, I was fortunate to spend 13 years as an executive with Andersen Consulting and Accenture. During my tenure, I had the opportunity to help senior leaders at many Fortune 50 companies grow revenue and reduce costs through the use of innovative and value-driving technologies and solutions. Amongst all of the ‘best-practices’ and thought leadership my teams and I helped impart on various companies, there was one general and guiding principle that I took with me to Nexicon. It is so simple yet so crucial to success. Deliver Value. When recommending and implementing corrective or new solutions and initiatives, it must provide substantial value for the client. At all times, our team at Nexicon is focused on leading with value. By providing innovative and game-changing, value-driving solutions for clients in the way of revenue growth, cost reduction, or the best available data and information for decision making, the ability to realize revenue for Nexicon becomes that much easier.
On our website, readers can learn about our various products and solutions. When we take our DigitalRanger product to a client, we provide value by reporting on real-time digital piracy, and in turn, Nexicon enters into long-term agreements to provide this service, along with support, to the client - whether a multi-billion dollar media company or a small publisher of written material. Revenue is influenced by the number of titles monitored and company size. Through DigitalRanger, clients may also send customized Cease and Desist notices, in which case Nexicon bills a client based on number of notices sent.
Some of these clients require additional insight into the data provided by DigitalRanger, in which case we produce a Business Intelligence report which delivers quantitative and qualitative information, over a period of time, on certain digital assets for a client. We deliver value by helping clients understand where their assets are being consumed around the world by metropolitan area, so that strategic decisions around piracy countermeasures or more importantly where marketing and sales teams should focus their efforts. In exchange for the value delivered, Nexicon charges a flat rate per report delivered.
For clients who require evidence against malicious facilitators of digital piracy, Nexicon provides investigative services. DigitalRanger is used by Nexicon’s subject matter experts to identify the infringers, and evidence is collected and stored for use in litigation. In exchange for the value delivered, Nexicon provides these services at a fixed hourly rate.
In some cases, clients are subject to malicious hacking and theft of their digital assets. Nexicon delivers value to these clients by providing full-scale and comprehensive security assessments, ranging from network security to data storage to email usage. In exchange for the value delivered, Nexicon enters into consultative commercial arrangements to provide the assessment, and is able to provide solutions based on the findings and recommendations.
Through our GetAmnesty and PayArtists solutions, we share with the rights holders settlements collected via the DMCA notices sent to infringers. The copyright holder sets the dollar amount per infringement - in the case of PayArtists and for Frank Zappa, the settlement amount is $10 per infringement. Nexicon’s MARC platform is capable of sending 95 million DMCA notices each day. Nexicon’s MARC platform monitors billions of illegal downloads of copyrighted material on a daily basis.
With our YouScout solution (via our partnership with YouTube), we deliver value to clients by reducing their internal costs incurred in managing their content via YouTube’s video fingerprinting solution. Nexicon’s resources can perform these services in a much more efficient and cost-effective manner. In exchange for Nexicon reducing a client’s internal costs, Nexicon enters into long-term agreements to provide such services. In some cases, Nexicon can share in the advertising revenue generated by viewers who click on our clients’ claimed content on YouTube.
For our newest product, Envoy, we deliver value for ISP’s by reducing the internal costs associated with processing electronic DMCA notices. In exchange for this, we enter into long-term agreements to provide an ISP with the Envoy service and related support.
Nexicon is involved in other initiatives that are tied to revenue, but due to in-place NDAs, I cannot comment on their nature.
Tommy has blogged about our new offerings that will be available early next year. For those products, the revenue models are in the process of being shaped. At the appropriate time, the company will provide the related information.
As you should be able to see by now, Nexicon delivers value for clients through multiple channels, which translates nicely into corresponding revenue streams.
That is all for now, I turn the ‘microphone’ back to Tommy, and we continue with our regularly scheduled programming.
