I think that most dudes on the internet, and just about all with any interest whatsoever in adult entertainment, know about cam sites. Many will have visited and checked them out themselves. That’s not surprising, because cam sites are pretty awesome places: They’re like strip clubs on your computer, and they can totally rock your ballsack.
And yet, while pretty much anyone could explain a strip club’s business model with varying degrees of accuracy, there seems to be a lot of confusion out there as to how cam sites make money. So I wanted to cover that today, and explain exactly how these platforms bring in the bucks that they do.
ATTENTION: The big cam sites bring in a whole lot of money, so we’re gonna take a deep-dive look at how they do it, what their expenses are, how much profit they pull, and whether their webcam models get a fair shake.
State of The Cam Site Industry
As of 2019, the webcamming world is dominated by a few major sites; basically, that’s Chaturbate, MyFreeCams, and LiveJasmin. Not all that long ago, MyFreeCams was the undisputed king of the hill (at least as far as “free” cam sites go), but it’s lost a bit of ground to competitors in recent years, mostly because it only allows women to cam there. It continues to lead the industry, however, in the “community” and social features department, which so many cam sites neglect.
Chaturbate welcomes not only women but men (a smaller but solid market that’s not to be ignored), trans people (pretty niche, but growing), and couples (absolutely freaking huge). Chaturbate is also fairly intuitive and easy to use for new cam models and viewers alike, all of which taken together has propelled it to the number one spot. The site regularly appears on SimilarWeb’s Top 50 list of highest traffic websites in the US.
Chaturbate debuted less than 10 years ago, but has already risen to the top of the cam site heap. Most attribute its success to variety of models, ease of use, and a plentiful collection of “apps and bots” that make running a chatroom much easier.
A much smaller, newer site known as CamSoda is showing a lot of potential, in large part because it has already proven impressively capable of attracting big-name pornstars to perform there, but any glory days it may have are in the future. Then there’s Cam4, which is actually very popular in the worldwide market, but struggles to gain traction in North America. North America has by far the industry’s most lucrative traffic, so that’s no small problem.
All but one of the sites I’ve mentioned use the “free to look” business model, while LiveJasmin still sticks with the old school private-show-based model, which keeps the naughty activities out of public view. That means “free to look” dominates camming, at this point in time, so I’ll focus on that in this discussion.
How Cam Sites Operate
As the name implies, free to look means you pay nothing for simply loading up a cam model’s public chat room and watching her show. Usually, you don’t even have to be a member of the site to peek; guest accounts are welcome to have a look for as long as they like (though some sites require guests to register after a period of time). Sometimes, depending on the individual cam girl’s settings, guests may even be allowed to post in the public chat – although most models won’t ever respond to anything a guest says or asks for.
Cam site revenues depend entirely on members choosing to whip out the ol’ credit card to exchange real money for on-site “tokens”, which are the currency of any given site. It’s with these tokens, and these tokens alone, that a member can do just about anything on the site that does require payment; principally, that’s tipping the models and buying special shows from them.
Special shows can be anything from group performances done for only a small number of paying viewers, to semi-private shows with a single interactive member but which also allow voyeurs (who pay for the privilege of watching), all the way up to “true” or “exclusive” private shows – just you and the girl, with no one else talking or spying.
Different cam sites monetize viewers in different ways, but it generally boils down to tipping and the purchase of explicit “private shows.”
All money spent on buying tokens is shared with the models, according to a revenue split agreed upon when a girl signs up. This is how a cam site makes money, and by extension, how a cam girl does as well. The site takes your funds up front when you buy, then pays out a percentage of the cash value of the tokens a given girl earned in the previous period. Most cam sites keep anywhere from 40% to 60% of token value, while the rest goes to the model’s bank account as her earnings.
And just to briefly cover the competing business model, LiveJasmin’s primary difference (aside from calling their tokens “credits”) is that they don’t allow their models to get naked or do anything explicit in their public chat rooms. If you want to get to the good stuff with a Jasmin girl, you have to pay credits for a private show. This used to be the norm, but nowadays, LiveJasmin is the only major player that still operates this way. Free to look is clearly the future of cam site revenues.
Costs of Running Cam Sites
Under either model, though, it must be sounding pretty good to be a cam site operator right about now. After all, you don’t have to hire the girls that appear on your site. So all you have to do is run a website, sign up as many models as possible, and kick back as you watch the moolah that your cam models generate roll right into your pockets. An easy business, with low stress and surely a high profit margin, am I right?
Well…not exactly. There are obvious expenses for any website, such as paying to run servers – especially high-capacity servers that can handle the kind of traffic a cam site hopes to attract. And as we’ve seen, in most cases, none of that traffic is under any obligation to pay one cent that would help cover the resources they’re tapping.
But cam sites incur less obvious costs that often aren’t considered, as well. For instance, whenever a member buys tokens, that money has to be handled by a payment processor, which can keep as much as 10% of the cash as its fee. And of course, that member isn’t even going to know to come buy tokens if the cam site doesn’t advertise; break out the checkbook again.
Sometimes cam sites use affiliate programs to entice online marketers to refer new customers, but you guessed it: Those headhunters get paid too, usually in an ongoing percentage of ALL money a referred member EVER spends on the site. When you total it all up, operators are lucky to pocket a 15% profit margin off gross cam site revenues. And as with any business, it’s always possible to have a bad-ass “slump” and hemorrhage some major money for a while.
The costs of paying for traffic, recruiting models, affiliate commissions, web design, and bandwidth can cause a cam site to end up burning through tons of money.
Let’s not be too gloomy here, though. Overall, the mechanics of how a cam site makes money are pretty solid. It’s not easy-street and pure profit, but they’re doing just fine; especially the bigger players. It should definitely be pointed out, however, that starting a new cam site from scratch is decidedly difficult as all balls. This is an extremely brand-sensitive business, and it takes a lot of time and money to build one up properly.
As for the cam girls who actually fuel all the fun in Camland, if they go about their business just right, they’re not gonna be complaining too much. While they do have to have at least some savvy and put in the necessary work, they too can do very well financially. Sometimes very, very well, as the top webcam models in the industry are easily pulling down six or even seven figures doing nothing else. I have a course explaining how top models do it here.
Related: How much do cam girls make?
Hopefully, that was a bit of an eye-opener for anyone who wasn’t clear on how exactly cam sites make their money, and how the camming world works business-wise. It’s good, lucrative work for all involved, and best of all, it’s a great release for all those boneprone internet pervs out there (Camlords included).