Tag Archives: monetisation

More thoughts on paying for online content

In response to the news that Google is throwing its hat into the online content micropayment ring, Mindy McAdams counters with a suggestion for a small daily fee for website access, as opposed to, say, a small fee for individual article access. She imagines:

a kind of token ID, sort of like a gift certificate code. (These must be secure, because every e-commerce site uses them.) The difference would be that you could use the same code on any computer, logging on and off, for the specified period of time. (The code would expire after 24 hours, for example.)

My response to this is that the biggest problem is not necessarily the willingness of people to pay for journalism (though, to be honest, I think they are less and less inclined to do this), but making the effort to actually do so.

Anything that puts up a barrier between user and content will drastically cut usage, be it registration, making people watch an advertisement before seeing the content they click through to, or making a payment.

The payment thing is a double whammy. I may (possibly) be prepared to pay my 50c to read the New York Times. But I can’t put coins into my computer. So I must be a member of some payment mechanism (PayPal, Worldpay, whatever) and so be able to pay through that, using my passwords and such. Or I must have my credit card to hand and go through the palaver of using that. Really – it would have to be extra special and useful content for me to do that, and 99.9% of the time online it isn’t.

The other issue is the difference between consuming paper-based content and online content. I may well pay $1 or so for a newspaper to read on a journey, or with a cup of coffee, but I’m much less inclined to do this for online content. Online, I’m much more likely to be reading an individual article that I find through search, or via a blog link. I don’t sit down and “read the paper” in the same way.

Some attempts are being made to think around this problem. There are a few donation-based models now up and running that take money you put in a central pot and distribute it around web sites of your choice based on your actual usage. But as this is a charitable model, you’d have to be very motivated to set that up.

Could you make this sort of model compulsory? Maybe. But I think it’s the breaking of the link between the payment and the physical object of the newspaper that’s at the heart of this.

Breaking music albums up into MP3 tracks has destroyed consumers’ willingness to buy actual albums. Similarly, the breakup of content on the web has undermined consumers’ willingness to buy newspapers as newspapers online.

So, unless any suggested payment mechanism can accommodate much more promiscuous online reading patterns, I think it’ll be a non-starter.


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Coca-Cola Unbound

CokeWhat a difference a grinding advertising recession makes. Only six months ago, culture secretary Andy Burnham said that a three-month consultation between the government and advertisers had “failed to produce a convincing case for product placement”.

As ever, of course, the usual government terror of bad things happening to people because of the economy has meant a predicted U-turn. Now, new broom culture boy Ben Bradshaw is thought to believe the exact opposite – and that a ban on product placement puts UK programme makers at “a competitive disadvantage compared with the US and other rivals”.

Whatever. It won’t help the BBC, or children’s programme makers (and let’s not forget that it was the popular ban on junk food advertising that has helped to hammer independent sector children’s programming).

But, you know, it might just help us bloggers. In a comment on my recent blog stats geekery post, FleetStreetBlues said “Now if only we could make the damn thing pay…”

The answer is simple – strike a lucrative product placement deal and fame and riches beckon. My cheque should already be in the post…


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The newspaper online pay-wall debate rages on…

…largely in the comments section to my post a couple of days ago, oddly enough.

Soilman points me to an interesting article in the Telegraph about Swedish peer-to-peer site The Pirate Bay and the general unwillingness of consumers to pay for content these days.

Here’s what the Telegraph thinks:

Why won’t consumers pay for content? The answer is very simple. Consumers have been so spoilt by free content over the last fifteen years that they now take it for granted that content should be free.

Uh, yes. Those selfish, thoughtless consumers.

Well, actually – in more specific economic terms – the cost of publication and the barriers to entry are so low that there is a vast supply of content. And that means consumers are just shopping in a media mall where everything is at bargain basement, loss-leader prices. Of zero, mostly. 

Attempts to choke off that supply and so create artificial scarcity – a bit like De Beers and the diamond trade – are doomed to failure because there’s just so much stuff out there to read. 

And I loved this bit:

At a certain moment in the not too distant future, consumers will finally have to acknowledge their own guilt in the destruction of our paid culture. 

Yeah. Sure. That‘ll happen…


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More arguments against the newspaper online pay wall

Here’s a nice piece from Scooping The News that outlines clearly why they think charging for online news content is a bit of a non-starter.

It covers the main bases:

  • The supply of web content is now vast
  • Charging hasn’t worked for anyone else yet.
  • Newspapers don’t have compelling enough content to compete
  • There will always be free competition

And as Rupert Murdoch has noticed – the main free competitor in the English-speaking world will be the BBC. In the face of such asymmetric competition, I wonder if anyone can make a go of charging for content online.

More on the position of the BBC in all this to come…


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Boston Globe to set up web pay wall

Even casual readers of Freelance Unbound will know I’m pretty sceptical that the news media will find it easy to make a go of charging for online access to plain old news. But, you know, I could be wrong.

A case in point is the Boston Globe, which has announced it will definitely, absolutely, start doing this soon.

Although, according to the report from Editor and Publisher:

Neither the specifics of the plan nor a potential date to begin charging have been officially announced.

Hmm. Well, we’ll wait and see I guess.

Don’t get me wrong – I’d be delighted for the Globe if the plan works. And it seems from the noises being made by publishers that newspapers with their back against the wall see no other option. So we may well see this experiment happening.

And maybe once some papers take the plunge, others will rush to copy them. Although this flies in the face of most commercial experience, which will normally see companies sitting back to watch as higher prices kill off a competitor rather than happily joining in with the strategy.

[HT: Annette Novak]

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Maybe we should make the BBC force us to pay for its web site

There’s a good piece on PaidContent.org about Rupert Murdoch’s plans to charge for News International’s web content. Part of this will be to charge for access to The Sun and the News of the World online.

How will he manage to do this?

“Just make our content better and differentiate it from other people. And I believe if we’re successful, we will be followed by all the media.”

Well, maybe. Anyone familiar with this blog knows I’m sceptical about the ability of general news media to charge for content to the extent that they need to. Sure, they may make some money from subscriptions online, but enough to fund an entire news operation? And enough to make up for the decline in advertising revenue that will come from having a much smaller readership?

As others have suggested, the real commercial model for media will probably come from added value services (maybe apps, maybe something else). I suspect the old menu of news and, increasingly, entertainment is just not different enough from the free alternatives.

And before anyone starts banging on about how the free stuff is no good, look at how many people happily read the crappy free newspapers on the train rather than buying a “quality” paper. People don’t see it as a problem for the most part.

But Murdoch himself acknowledges the key problem:

“Frankly, the big free competition will be coming from the BBC.”

Perhaps the solution is to force the BBC to put up a pay wall at the same time. That way we’ll see if users can be tempted to pay for news content when there’s no decent free alternative…

[HT: Jessica]

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Worth 1,000 words?

Some more evidence that digital creation and distribution of content will keep transforming the media – Getty Images has bought iStockphoto for a reported $50 million.

The web and digital technology have transformed the business of photography. But what at first made picture researchers’ lives easier has now made it much more difficult to make a living – after all, if they can search digital archives online from the comfort of their armchair, so can anyone else.

By the same token, it has also put immense pressure on photographers. Now anyone with a decent digital camera (which means most people with a digital camera) can not only take passable photos but also distribute them globally.

But it’s also put pressure on photo agencies. Let’s face it, almost no one sitting on the production desk of a low-budget print or web publication will pay much at all for stock images. Which is why iStockphoto has been such a runaway success.

Part of this is its simplicity – no phoning up the picture agency, or drawn-out verification process, just click and buy. And it’s pretty cheap – a small image costs about £3, a really big one less than £18.

It’s understandable that Getty wants to get a piece of this low-rent action. Yes, the pricing model undercuts the established agencies, but there’s not much they can do about that. So it makes a lot of sense to embrace the change than try to make a futile stand against it.

One interesting thing about the so-cheap-they’re-almost-free photo resources is that their prices seem to have actually been creeping up lately. Longer-term users may have noticed this already.

It’s interesting because it shows that people are prepared to pay something for digital content online. It also opens up the question of whether this has implications for other kinds of digital content, such as journalism.

I’m very sceptical that users will pay much, if anything, for access to journalism as we have traditionally known it online. But people are willing to pay some money for stock photography.

It’s not just business users – if the alternative is trawling through Flickr for hours to find a suitable image for no money, some individuals are prepared to pay a few dollars or pounds to save time and guarantee a better or more appropriate image for their website or whatever.

Getty clearly hopes that its existing high-end library will survive the arrival of ubiquitous digital imagery. But in case it doesn’t, it seems to understand that a big slice of the market is now in low-cost user-submitted material.

The key to success seems to be offering a product that offers some clear benefits:

  • Saves time
  • Increases choice
  • Is perceived as good value
  • Offers products people actually want

The parallels with journalism are not exact of course, but there’s a lesson here that’s still worth learning.

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