How can a company like Automattic make money if they are giving away all their products (including WordPress) for free? Someone asked this question to WordPress founder Matt at WordCamp India and he surprised, at least some of us, by saying that Automattic is profitable.
Here’s how WordPress makes money according to the creator himself:
1. Blog Hosting – WordPress offers blog hosting services at $500 per month to big publishers like Om Malik, All Things D and CNN’s Political Ticker among others. They use WordPress.com’s server infrastructure to host your blog and therefore the performance will obviously be great but unlike other web hosting services, WordPress VIP Hosting doesn’t accept everyone who applies so good luck.
2. Google AdSense - Free blogs hosted on WordPress.com may sometimes carry Google ads but these ads may only appear if all the following three conditions are met:
1. The visitor is not using Firefox browser.
2. He has logged out of his WordPress account, if he has one.
3. The referring source is not a WordPress powered blog. So a person reaching abc.wordpress.com from xyz.wordpress.com won’t see any Google Ads.
Even with all these conditions, the revenue generated from serving Google AdSense ads on WordPress.com hosted blog may still be significant as do around a billion page views per month.
3. Automattic Kismet – You don’t see Viagra spam in your blog posts because it all gets filtered automatically by Automattic Kismet (Akismet for short), the excellent spam protection plug-in available for WordPress.
Now Akismet spam catching technology is free for personal blogs but if you maintain a corporate blog or run a network of blogs, you are required to buy a commercial license of Akismet that starts at around $50 per month.
What may surprise you is that professional bloggers, or anyone who is making more than $500 per month in advertising revenue from a WordPress blog, also needs to pay a $5 per month fee for the Akismet license.
4. Premium Accounts – While anyone can host a blog on WordPress.com for free, they charge you a fee if you want to buy additional storage space for your multimedia files or want to use a custom web domain instead of the default wordpress.com sub-domain. These are premium features.
There’s also (unconfirmed) talk that WordPress may soon allow users to add AdSense in their free blogs for a subscription fee.
5. Web Host Referrals – WordPress.org suggests of list of third-party web hosting companies where you may self-host your WordPress blog(s) for a fee. Now all these are referral links so Automattic gets a commission per sale.
In fact, this hosting referral system may be extremely profitable for Automattic because if you search for "WordPress Hosting" on Google (a very competitive keyword phrase), the first sponsored link on the Google results page is paid by WordPress itself and it says – "Top 5 WordPress Web Hosts – Chosen by the developers of the WordPress blogging software".
6. WordPress Support – If you need help with WordPress (or WordPress MU) but the free support forums aren’t solving the purpose, consider subscribing to the Support Network of Automattic. The WordPress development team will help you solve problems related to your WordPress system and the response time can be as low as 6 hours. This service is primarily for Enterprise users who are willing to shell out a $2.5-5k per year for support.
7. Poll Daddy – I am not sure if Matt discussed this but Automattic also provides a paid version of Poll Daddy where you can have unlimited number of questions per survey and there’s no Poll Daddy branding in your polls or surveys.
Find this article at: http://labnol.org/?p=7576
Reader Comments
Hi Amit,
now the question is, How does blogger make money?
Written by Deluxe Templates on 02.24.09
And there are also domain upgrades customers like me who buy annual domain services for $15 to move from gautamghosh.wordpress.com to gautamghosh.net
I guess there will be more and more non-geeks like me who’ll use this – takes away the pain of downloading a new version and upgrading and praying everytime !
Written by Gautam on 02.24.09
@DT Blogger Templates can be easily integrated with Google AdSense thus indirectly contributing to Google’s bottom line.
@Gautam – True, and $15 per year is actually a very reasonable cost considering that it covers hosting as well.
Written by Amit on 02.24.09
I’m also unsure of poll daddy thing, because Matt advocated about poll daddy but he din said anything clearly and though poll daddy already have there own premium account.
So With second thought I dn’t feel that wordpress is getting paid from poll daddy.
Written by P@r@noid (From shoutmeloud) on 02.24.09
For displaying Google Adsense ads on free a/c, the first condition says that “The visitor is not using Firefox browser” – How does FF matter ? sound strange to me.
Written by Kevin on 02.24.09
LOL @ ‘not using Firefox’ :D
Written by Ankur Banerjee on 02.24.09
Except for Webhosting Referrals i don’t see any big income source for automattic. Dose he also accept donation/Royalty by big giant hosting their blogs on WordPress :-)
Written by Shanker Bakshi on 02.24.09
Never known that Adsense from WordPress itself hiddenly shows like that!
Thanks for the info.
Written by Gofree on 02.24.09
Is the revenue collected by the above mentioned steps is enough to develop WordPress further and maintain the same…
Can you provide the revenue in terms of rough figures…
Written by Fasil on 02.24.09
Its great to see the true source of Income for WordPress. But the big question is “How much money does WordPress many annually?”.
Written by Royal Blogger on 02.24.09
Oh, you forgot about the income WordPress may generate from Brian Gardner’s premium themes now exclusively offered as “Commercially Supported Themes” on WordPress.org without any competitors whatsoever. I imagine a deal was made between Automattic and Brian Gardner in which Automattic gets a commission for any sales.
Written by Kevin on 02.25.09
I did not attend WordCamp because I felt I do not know much about wordpress and do not own a good blog to brag about. But to my wonder there were people who asked Matt questions like these (I was able to understand the revenue model by studying the website itself).
WHAT I LEARNT ? : Believe in yourself and your knowledge, world is full of people who pose themselves knowledgeable just to be in the league of rationals/greats, don’t just be afraid of them. GO OUT EXPLORE THINGS.
@ AMIT SIR : More info. on the camp and your participation please, please please.
Written by Amol on 02.25.09
Hi,
I would like to integrate my existing .wordpress.com blog in my own domain, which I purchased from Godaddy. Do i just need to take their domain mapping service of $10/year or anything else, like hosting etc. What all is required & what’s the total expense, pls guide me
regards
Sophia
Written by Sophia on 02.25.09
I am just wondering if who has the biggest income for the world’s most used blogging platform, WordPress or Blogger?
And as Kevin said, what does Firefox got to do with the Google Ads? haha, seems weird… I guess they had a secret war in the past or right now?hehe
Written by BloggerTinker on 02.25.09
Sophia, here you go: link
It contains instructions on how to do it from WordPress and I suspect they tell you how to change the nameservers for your domain too. No hosting cost is required. You’re just paying the $10 or $15 per year to have your own domain instead. Hope that helps!
Written by Kevin on 02.25.09
Hi Amit,
First, a request. Will you please upload your WordCamp presentation on your site. Was nice. Would like to refer to some parts of it again.
Second, your attention. Akismet commercial licence for pro-bloggers who earn at least $500 a month is not $5o a month but $5. $50 is for “commercial venture” such as corporate blogs and blog networks.
Cheers
Written by Pritam on 02.25.09
Thanks for revealing secrets. Great post. :)
Written by Harshad on 02.25.09
Direct hands + wordpress = money :)
Written by Aleks on 02.25.09
Great insights here, though I have known most of them, it is great to see someone deciphering a company to know how they make money
Written by Keith Dsouza on 02.25.09
Oh yeh, they make quite a bit of money. I wrote a recent article once comparing WordPress.org to WordPress.com, and I was horrified to find out how expensive the upgrades were… Hosting your own blog is definitely the better bet.
Written by Shirley on 02.26.09
But here the big question is “How much money the WordPress is able to make annually?. When I checked the traffic of WordPress official website in link . It doesn’t seems to get 1 billion pages view! Well the calculation may be wrong. Anyhow, the Government of the country should support and finance these types of organizations.Really the services provided by WordPress are wonderful but the money the the company generates is low in comparison to the services they provide. I think so …
Written by Royal Blogger on 02.27.09
But here the big question is “How much money the WordPress makes annually?. When I checked the traffic of WordPress official website in link . It doesn’t seems to get 1 billion pages view! Well the calculation may be wrong. Anyhow, the Government of the country should support and finance these types of organizations.Really the services provided by WordPress are wonderful but the money the the company generates is low in comparison to the services they provide. I think so …
Written by Royal Blogger on 02.27.09
Does anyone knows exactly how much Word Press really earns ?
Written by Royal Blogger on 03.01.09
Excellent article, I didn’t know that wordpress made money. I figured that it was for the greater good, but I guess not.
Written by Domz on 03.14.09
Great insights here, though I have known most of them, it is great to see someone deciphering a company to know how they make money
Written by kiwilman on 03.16.09
Very interesting, indeed. Who would have known that WordPress makes its money in these many ways. The one thing that caught my attention was the fact that if anyone makes over 500 in ads with WordPress, than they have to pay a fee of $5 per month. That is a lot of revenue, if a person includes the number of people globally who use WordPress as well.
Written by LionelEdwards on 04.24.09