This document describes various business models and provides examples of each. It discusses brokerage, advertising, infomediary, merchant, manufacturer, affiliate, community, subscription, and utility business models. For each model it provides a brief definition and highlights of key features, as well as an example company that uses that particular business model.

1. Topic 5

2. Business Models
• Now look at the list of business models below and describe the features
of each of these business models, giving an example of each.
• Brokerage
- bringing buyers and sellers together
- „brokers‟ are market-makers
- facilitate the transaction
- fees are incurred for the transaction
eg. Real Estate agent selling a home
• Advertising
Website provides:
- content (usually, but not always, for free)
- services (email, instant messaging, blogs)
- advertising messages (banners/logos)
eg. Google

3. Business Models
Infomediary
- collects data on consumers and their habits and trends
- assist buyers and sellers to understand the market
- allows an advantage to buyers and sellers
Example: Pop up ads/banners that appear when you go on certain websites.

4. Business Models
Merchant
- concerns wholesalers and retailers of their goods and services
- Sales are based on price lists or through auctions.
Example: A store that operates solely on the internet, such as the iTunes
store.

5. Business Models
Manufacturer (Direct)
- manufacturer reachers customers directly
- compresses the distribution channel
- company that creates their own products/services
eg. Fantastic Furniture creates their own product and also provides the
delivery service to buyers

6. Business Models
• Affiliate
- provides purchase opportunities wherever people may be surfing
- offers financial incentives to affiliated partner sites
eg. Amazon is again the perfect example as they revenue share and use
pay-per-click

7. Business Models
• Community
- based on user loyalty and the time they spend
- revenue can be based on voluntary contribution or based on the sales of
ancillary products and services.
- more fertile area of development
Example: Wikipedia is open globally to the content and opinion of others.

8. Business Models
Subscription
- users are charged a periodic fee to subscribe to the service
- combining free content with premium membership
- costs are irrespective of actual usage rates
Example: Magazines such as Dolly or Cleo who charge a monthly
subscription to access there content on line.

9. Business Models
• Utility
- based on metering usage, or a “pay as you go” approach
- based on usage rates
- „pay for what you use‟
e.g.. An example of this would be electricity and gas companies which
invoice customers for amounts based on their usage

10. Business Models
• 1. What is the Mobile phone use/100 population – compare Australia,
USA, China, India, Your Country
Australia: 100.4% of the population
USA: 103.3% of the population
China: 81.2% of the population
India: 73.1% of the population

11. Business Models
• 2. What is the Internet use/100 population – compare Australia, USA,
China, India, Your Country
Australia: 79.0% of the population
USA: 77.9% of the population
China: 38.3% of the population
India: 10.1% of the population

12. Business Models
3. Compare the main strengths and weaknesses of Australia in the survey
The survey shows that Australia has a 100.4 mobile phones per 100 people.
Obviously this is more than one phone per person, i see this as a weakness
because although mobile phones are becoming more essential to everyday
life, why would somebody need more than one? Meanwhile, Australia‟s
internet usage of 79% of the population is MUCH higher than that of China
and India. Largely due to differences in population and lifestyle. I see this
as a strength for Australia as internet access should be available for
everyone.

13. Business Models
4. What does the survey suggest to you about the Information Technology
readiness of Australian business compared to Australian consumers?
Australia are ranked 17th overall in network readiness and 19th overall in total
internet usage. These stats show me that the population is ready for
improving technology and would hate to be left behind.

14. Bibliography
• http://data.worldbank.org/indicator/IT.NET.USER.P2
• http://thenextweb.com/entrepreneur/2011/05/25/the-9-types-of-online-
business-models-which-one-do-you-use/
• http://ecommerce.hostip.info/pages/569/Infomediary-Model-
INFOMEDIARY-MODEL.html
• http://api.ning.com/files/O1d7YEjts2c86FAbY4lGwuTV-
8Cd0EnNfZdwolcbh8O9kszKHBf3HrD9EU9bez4*BBVfFpazhwdqVqxM
FljTrQQWEEzlNGmQ/ebusiness282x300.jpg