Facebook, Twitter, and their investors may be profiting from user-generated content, but there's one person that's not: the user himself, who sees all the money from targeted ads (how did they know I was looking at those Ugg boots on Zappos?) go directly to those companies. But today (Oct. 21) sees the public launch of a new social media platform with an algorithm that re-distributes ad sales revenue directly to the source.
Tsu advertises itself as the first combined social network and payment platform that lets users maintain ownership of the content they post. Like Ello, another recently launched innovative "anti-Facebook," it's free and invite-only -- but tsu seems to have a more sustainable premise and business model than the slightly more utopian Ello, which eschews ads altogether but also may be on the wane following its launch in late September.
“Established social networks have built amazing business models prospering on the total monetization of free user-generated content,” says tsu founder Sebastian Sobczak. “Why should anyone commercially benefit from someone else’s image, likeness and work giving no financial return to the owner? The markets we participate in are enormous, growing and can materially compensate each user -- we’re simply and uniquely rewarding the users who are doing all the work. This is the way the world should work.”
At first blush, the world of tsu works in much the same way as any other social media network. Ad revenue is generated from page views, except in this case, only 10 percent of the money generated goes to tsu. Of the rest, fifty percent goes to the profile owner/content creator -- let's call him John Smith -- and the other 50 percent goes to the network that brought that particular user to the network, and that's where it gets complicated.
That 50 percent propagates by an infinite series of thirds up a "family tree," starting with Smith, otherwise known as a "child." The person who invited him to tsu, his "parent," receives a third. The person who invited the parent, the "grandparent," receives a third of that third. Tsu's pay-it-forward algorithm that distributes these funds is based on their invite-only principle.
The analytics page shows which of Smith's posts and shares received the most views and thus generated the most revenue via his profile page's targeted ads. Once a user accumulates $100 in their "bank account," they can cash it in. There's also a peer-to-peer payment system similar to Venmo, and users can also donate anything in their bank account to a charity that is also on the network, like George Michael's arts nonprofit the Goss-Michael Foundation.
Other launch partners include LeAnn Rimes, 50 Cent, and DJ Afrojack on the musical side; athletes like Miami Heat's Luol Deng, U.S. track and field Olympian Doc Patton; and organizations such as Environmental Media Association and hospitality and entertainment company SBE Entertainment. Funding firm Sancus Capital Prive backed tsu's $7 million funding round.