There’s a great discussion going on in the Fantasy Sports Executives group on LinkedIn right now about whether a niche fantasy sports site should use a free or pay revenue model. This is a question the industry has struggled with since its inception. For the smaller fantasy sites, this is a life or death question.

Gerry ScottoDiMarco of RotoRank started the discussion. His site utilized a subscription revenue base for the last six years, but is concerned that his subscription base will be flat or decline for the 2010 fantasy baseball season. This is a very common concern for fantasy site owners these days and should at least be considered by most fantasy site owners.

By switching from a pay to a free model, Ed Menendez points out that, “Not only will you have to redesign the game to be more efficient to use less resources when its free costing you time there, but the outlay on hardware and bandwidth will go up.” Free is not always free to create. Free is all about optimizing operations and resources so that they are almost free and that the ad revenue generated is enough to overcome it.

The other item that came up in discussion is the use of the freemium model where it is free to play a fantasy game, but you charge for premium items such as free agent pick-ups. The general consensus from the discussion thread was that niche sites had to include some element of paid subscriptions model in order to survive. Now, if you have the scale of a Yahoo! or ESPN, the ad-supported model definitely is much more achievable and you may be able to forgo any premium aspects.

What are your thoughts on the topic?

The economy is hitting everyone to some degree, with feeling it harder than others. Spending money on a fantasy football subscription might be a harder decision these days, so I am happy to see that RotoWire has found a way to still get its subscription fees, while fantasy players get their RotoWire subscription for free.

RotoWire partners with CheckoutFree.com to present the RotoWire for Free. To get the free subscription, users have to purchase or try out another product, and that that product pays the RotoWire subscription fee. While this is an option RotoWire has offered for a while, with the current state of the economy, it might be a much more appealing option this fantasy football season.

In case you were wondering, this was not a paid ad by RotoWire. I think it is a good idea, and something which people should know. So, I wrote an article.