Earlier this week I had a chat with Jason Nazar of docstoc.com. The company had contacted me a while back suggesting the chat. They're a beta-level software startup dealing with professional, legal, and business documents.

I was initially dubious that there was a Copyfight angle to this story. As Nazar himself pointed out, there's not a lot of illicit traffic on the P2P nets in business content, particularly when compared to the volume of entertainment-oriented content (music and movies primarily). That said, docstoc does have some points of interest for this blog, particularly in thinking about new business models that could be built around sharing.

First, back up a few steps. Docstoc is a hosting, sharing, and community site. Like YouTube it produces no original content bur rather holds and shares content (documents) uploaded by people. There's no membership fee and anonymous uploading is allowed. If you want to download a document, then you have to have a site login.

Since the point of the site is to share documents, everything placed on the site is in some sense free. Docstoc takes advantage of several Creative Commons licenses so when you upload files you can specify varying degrees of free - free to view and free to download being the two most popular I saw. The site uses a proprietary Flash program to embed the content for viewing, which allows them to encapsulate most of the popular business document formats (PDF, Word, Excel, PPT, and so on) in a uniform UI. In addition, they allow the player itself to be embedded; for example, here is a TechCrunch blog entry on WikiMedia's financials that contains an embedded docstoc player. Paradoxically, their use of an encapsulating player may both protect documents from casual copying while thwarting automated scanners like Attributor, which attempt to detect reposting of private content.

Docstoc is what I'd call a 'data cloud' play. Like Google Documents and other applications, there is an appeal to upload your content and access it from anywhere you have a net link, not just the hard disk on which the document currently resides. Like YouTube it also has nascent community features, including ratings, view counts, and personal blogs. Though these seem to be de rigeur in today's apps I'm not sure of their value here.

So, if everything is free, how does anyone make money? Well, from an individual point of view, docstoc is at worst free advertising. Many small companies and sole proprietorships put free samples, white papers, and other business-related downloads on their sites, which then languish in obscurity. These same files, uploaded to docstoc, become indexed and searchable both on the docstoc site and on major search engines that crawl the docstoc pages. When Google searches start to return hits into docstoc's cloud there's a good chance the uploader is going to see higher SERP placement than he could manage on his own.

Docstoc itself has to figure out how to make money on this and so far they don't have a solid model in place. Obviously there are advertising possibilities. As with any kind of targeted search, docstoc has the chance to generate high-quality sales leads to advertisers. There's also an option to partner with high-end paid content providers. These providers (think Gartner Group) are never going to put up their expensive paid research on docstoc. But they could put up teasers and previews, then kick back a piece to docstoc for sales leads and link referrals.

Finally there's the idea that documents + service are more valuable than just documents alone. This is similar to the open-source notion that software+service is better than only raw code. If I've just downloaded a business plan template it might behoove me to sit down with a consultant in my area to flesh that plan out. Again, docstoc is positioned to know what I've downloaded and possibly where I'm located so they can hook me up with a service professional, taking a small slice of the business referral revenue.

It's an unproven model, but that's true for most anything you can say about trying to make a legitimate business around freely sharing information. I don't know if I'm convinced enough that I would invest my own cash in the business, but I'll probably upload some documents and see how they fare.