Saturday, March 24, 2007

The AGLOCO member calculator: what will you earn?

The AGLOCO member calculator: what will you earn?

The AGLOCO member calculator does not calculate in dollars or any other money amounts. This means there is no guarantee that you will make over $4,800 per month, if you refer 5 members, as some are claiming (including an alarming number of Portuguese-language blogs I have seen).

Here's how it works:

The calculator shows the amount of hours you will likely earn if you refer x amount of members who surf x amount of hours. Nothing more.

When the Viewbar comes out and advertising money begins to flow, AGLOCO will, based on this information, specify a rate per hour. Based on this, you will be paid according to the total number of hours in your account (that third column in your chart that will only contain zeroes until the Viewbar is out) multiplied by the rate of payment established per hour. If the rate is $1 per hour and you have 1000 hours, you will get $1000. If the rate is 0.65 € and you have 300 hours, you get 195 €.

A more thorough example:

Let's say there are 450,000 members and $40.5 million in advertising revenue the first month the Viewbar is out, and each member surfs the maximum 5 hours (of course it won't be quite like that, but for simplicity's sake let's assume this):

450,000 members X 5 hours per member = 2,250,000 actual member-hours.

Why actual? Because we still are missing something: since each member gets credit through 5 levels, this means that each member-hour surfed counts 5 more times. Even if nobody referred you, your status as a direct or indirect referral of the company remains. Thus, every member hour that exists is counted once for actual time and five more times in five other members' networks as the hour of a direct or indirect referral. To clarify,

1 actual member-hour = 6 hour credits.

So, multiplying 2,250,000 actual member-hours by 6, we get 13,500,000, or 13.5 million hour credits.

Now, using the $40.5 million revenue figure I pulled out of my imagination, we must divide the revenue by the total number of hour credits to get the rate of pay per hour:

$40,500,000 divided by 13,500,000 hour credits = a rate of $3 per hour credit.

Thus, given these conditions (which are just for demonstration and should not be taken as realistic examples), if you have 9 members in your network (including you, a total of 10 members) and you and all of them surf the maximum 5 hours, you will get credit for 50 hours and will thus receive 50 X $3, or $150.00.

PLEASE NOTE THAT THIS IS SPECULATIVE. I have, for simplicity's sake, omitted other factors that will affect this rate:

  • AGLOCO's operating costs, though they will be small in comparison to its revenue, will need to be subtracted from the total revenue before calculating a rate.

  • 10% of the profits goes to the AGLOCO team (that's right, just like Tom Cruise pays his agent 10%). This of course also lowers the rate.

  • Now for the bright side: not every member will download the Viewbar, which brings the number of active members down and thus will increase payouts.

  • For those of us who download the Viewbar and use it, if it is not used for the five hours, you only get credit for the number of hours you use it AND you only get credit from your downline members' hours to the extent that you surf. If you surf only 1 hour, you only get 1 hour of credit for every 5 hours earned by your network (in the above example, you would not earn $150, but $30). This obviously means that the number of hour credits is reduced, resulting in an increase in the overall rate per hour credit.
  • The AGLOCO affiliate discount program may throw in other variables. Here is a description of it, taken from this post on the official AGLOCO blog:


"The AGLOCO Viewbar software will be capable of sensing when you are making the type of purchase for which AGLOCO has a revenue sharing program (and by potentially directing you to that partner if you are not already on their site). If you make a purchase, the Viewbar will collect the commission from that purchase. Initially, this revenue may be added to the general AGLOCO revenue pool for expenses and Member distribution, but eventually a sizeable percentage for that revenue will go directly into the Member’s account. Thus, the more a Member buys, the more money will be put into his or her account in addition to regular AGLOCO income."

AGLOCO put that stipulation about using the Viewbar for the maximum time allowed in place so that people would start using the Viewbar often and right away (companies want to know that they are reaching people with their ads). Aside from what is mentioned here, I can't think of anything else that enters into the fray. Please comment if you think of something.

No comments: