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PodSense: How will Podcasting make money ?

Podcasting requires an investment since you have to host the MP3 files on web servers - when users download them on to their computers or iPods, they are essentially consuming your bandwidth which ultimately costs money.

The web hosting cost is directly proportional to the popularity of your podcast show - more subscribers means more downloads increasing your bandwidth fees. And unlike Adsense or YPN, there aren't any popular services yet to monitize podcasts.

But people have been trying to find a way to generate revenue with podcasts. Popular host of The Office, Ricky Gervais is now charging $2 per podcast episode. RocketBoom, another hugely poular vidcast show, is planning to go premium by charging subscribers $4 per month.

But will people really pay to listen to podcasts or videocasts ? Rachel Rosmarin has an interesting story on Forbes on this - Who's Paying For Podcasts?She writes about why Podcasting is not yet a popular medium with advertisers:
The main problem: Advertisers want information about the audience for their podcasts, and there's not a lot available right now. Just because someone has downloaded a podcast doesn't mean he or she has listened to it. And advertisers generally don't know who the users are or if they're listening to the files at work, at home or on a portable player like an iPod--all of which are data points that traditional advertising purports to deliver.
According to experts, only the most popular podcasts - perhaps the top 5% - will be able to coax dollars from consumers using pay-per-download model.

But in order for podcasting to really take off as a business, podcasters are going to have to get better at establishing the value of their audiences. One possible solution: Audible's WordCast product, which charges podcasters up to five and a half cents per download to help them come up with an advertising-rate card with information about each listener.

Related: Insert Ads in Podcasts