What Soundguy said.
I have had the conversation with a bunch of producers now and I think I can safely say it's not an exact science what sells well and we all have that video we thought was crap but released anyway and sold very well and that one we thought was going to bring in some good turnover and fell on it's arse.
As for how big is the pie... I don't think it matters. The key I believe is take a niche within a niche and do the shit out of that niche as well as you can. Don't look to make money, because that's when it all fails. You have to do what you love to do it well. EVERY part of it. From finding models, to making the materials to cleaning up to lighting to editing to making a website to publicizing... then the money will come if enough people like it. But it's a LOT of work, a looot of work. If you are not experianced in any of those and hope to turn over some $$$ then it's a lot of trial and error.
I can't really give an indication of how things sell, a big back catalogue is needed to turn over - it's not like having hit singles, it's all about deep back catalogue... and maximising revenue streams and all those big pretentious phrases that annoy the crap out of people.
My rule of thumb is every video released sells x amount, but drives a lot of discovery traffic to the back catalogue wether it's download store or members area.
Members site wise... I started of with around $1000 start up on a credit card six years ago, and was turning over enough to keep the site revolving and pay the bills in six months. It was hairy for another six after that as the bills got bigger and membership levels rose just enough to sustain. For the first six months I was still holding a nine to five day job and existing on around four hours of sleep a day.
A lot of the start up is learning, and learning to create workflows to maximise the time you have and for me... praying like hell to a god I don't believe in that nothing expensive happened to put the site under.
A lot of people are discovering that filming something and throwing up a download store will not ultimately make them rich. It takes a lot more than that to turn a profit.
How big the pie is? It's fucking HUGE, but as Soundguy said, there are a lot of slices.
An interesting question to also ask is how many producers actually solely produce videos as a day job? I bet it's under five. I would lay ten bucks on there being three that do it comfortably.
(Soundguy is predominantly a distributer I believe and Derek predominantly a webmaster. Correct me if I am wrong of course.)
If you have some money to burn in the name of fun... go for it is my advice and see what happens... but don't aim for success. Just do it as well as you can and whole heartedly and don't aim for success and gently hope to be suprised by some!
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