It’s quite much like distribution of your earnings with your family at the end of the month. It is basically a sharing of profit (as well as losses) amongst the stakeholders, business coalitions or else also among the employees of an association. Even though it was well-liked in modern years on the internet as a division of associate marketing as well as marketing plans, revenue sharing has been in the network for long. The revenue sharing model is utilized by every sector be it technology, media, government, sports, investments, entertainment, and hospitality and so on. With the notion of sharing the financial system which is edged to be in our coming times, revenue sharing is getting additional revelation.
For instance, in the government, one of the functions of revenue sharing is seen in tax income sharing amongst various units of the government. For instance, states allotting tax income with local governments. Well, in sports as well, associations governing bodies plus the teams in the association divide up the revenue generated from local as well as countrywide television rights.
The main challenges in the Revenue sharing business model can be transparency, protection as well as swiftness.
It is not easy to roll the present disputes of the revenue sharing business model, because every industry has its personal mode as different businesses work with different goals and objectives. If we take up sports, for instance, inventive accounting can be utilized generate an inequity in revenue sharing owing to excessive parties occupied in the legalization procedure.
Blockchain technology has a remedy to the problems intrinsic in the revenue sharing business model i.e. to implement Smart contracts.
Smart contracts give surety about the precise revenue sharing in instantaneous time.
For a quick souvenir, a smart contract is a contract, which is driven by Blockchain technology, publicized in the structure of a computer program as well as executed once where all prearranged and planned terms plus the conditions are contented. At its foundation, the smart contract set of rules intends to build contracts safer, disinter intervened, thus performed in instantaneous time plus extra transparent, which are the literal obstacles with the revenue sharing business model.
Ahead of investing your money, the Customer will build the terms of the contract, hence you can bring in more trust and credibility to your business. Similarly, smart contracts will ensure that you acquire your correct share of revenue once you fulfill all the conditions specified in the project.
While smart contracts are based on the Blockchain technology, which is a public ledger that is preserved by numerous parties at the same time, smart contracts cannot be distorted. Consequently, given that a smart contract is kicked off, no single party can make a decision to modify it. A smart contract can only be ceased if all parties have the same opinion, which means that all your payments are secure and you will not have to pay a mediator fee also.