All of Heavy’s content fits its mission of providing entertainment, mainly comedic, for men, 18-34. The portal’s David Carson reports that it has an audience the size of Comedy Central’s.

Icebox will offer a combination of exposure and revenue-sharing. Initially creators will simply get a forum, but if their property becomes popular and is able to generate further revenues, they will share in any ongoing income streams, according to Vigderson.

Although some sites have been paying for content as long as seven years now, there still is no standard compensation model for revenue-sharing between distributors and content providers. It all boils down to the perceived future value of a specific property. “How much do you want it and what can you do with it as a business?,” asks Carson.

One company, Revver, has developed a revenue-sharing mechanism for user-generated content. “We’re a service that monetizes content that moves freely across the network,” says Steven Starr, the company’s founder/ceo. The service gives creators data on where their content is viewed, whether on websites, viral e-mails, social networking sites or blogs. Each clip is matched up with an advertisement, which appears with the clip wherever it is viewed; content providers receive half of all revenues paid by the advertisers on a click-per-view basis. Creators can set parameters for the type of advertisers they want to be linked with, and advertisers have the same ability to select or refuse content. Currently, ads take the form of still images at the end of each clip, but other formats, such as pre- and post-roll video, are expected to be added in the future.

The Revver network just came out of beta testing recently, but it already has a hit, the live-action video, The Diet Coke and Mentos Experiment. Creators Fritz Grobe and Stephen Voltz of studio Eepybird have earned nearly $20,700 on the clip, which has attracted more than three million total views. “It’s proof that the model works,” says Starr. “We’re aligned with the way the Internet was built to begin with. [Creators] can benefit from the freely distributed platform that the Internet was meant to be.”

A new user-generated site is aniBOOM, a broadband animation hub that features original animation, the aniBOOM Awards and content creation tools. © aniBoom.

“A lot of creators are frustrated with seeing their creative work distributed on the Web and they don’t have any control over it. But they do see the value of viral distribution,” adds Bill Jeffries, Revver’s vp of network development. “We try to give all the control to the creator.”

Investing in Content
Several portals are beginning to invest in promising productions upfront and partner in their development, similar to a television network. “The ultimate is that we pay you to make your cartoon,” says Bird, who stresses, however, that a portal’s budget is only so big and just a few properties can capitalize on this model.

Break.com, an online network for men that boasts 13 million unique monthly visitors, launched Break Ent. in April 2006 to incubate original online videos, which it will do in addition to acquiring and licensing content. Similarly, both aniBOOM and Machinima.com provide financing in some cases. “We want to find great talent and, as a production company, to work with them to develop their ideas,” Machinima.com’s DeBevoise explains.

Atom announced the opening of AtomFilms Studios in January to invest in independent productions. It said it had six new development projects at that time and that it planned to produce dozens of additional properties during the year. They will be distributed on AtomFilms.com and through the company’s partners in the online and mobile arenas.

Roesch points out that as portals launch and go through their early growth stages, they need to share risk with their creators, which a licensing model allows. But Atom and some other sites have been in business long enough now that that they can predict revenues fairly accurately and know what they can afford to invest upfront.

Revenue Streams
In order for portals to pay creators, whether through royalties or investment, there have to be revenue streams that are large enough to share. That is starting to be the case for many sites, which are generating revenues from online and mobile licensing, advertising and sponsorships and, sometimes, entertainment productions or merchandise licensing. Subscriptions are a possibility as well, although the most common configuration now is for sites to offer advertiser-supported content that is free to consumers.