Six Pixels of Separation - The Blog
October 12, 200910:26 PM

When We Switch From Free To Paid

When it comes to the troubles of the newspaper and magazine industry, the greater debate always comes full circle to when/how they will begin to charge for content. Some people call it crazy, others think there is no choice, but how will the general mass population react?

Vanity Fair has a great article in their November 2009 issue titled, Rupert to Internet: It's War! Journalist Michael Wolff dissects Rupert Murdoch and his plans to change News Corp.'s current online practices of giving the content away for free to a paid model:

"From the failure of Delphi, one of the first public-access Internet providers, in 1993, to iGuide, the precursor to Yahoo and Google, which closed within months of its launch, to his son James's aborted Internet-investing spree in the late 90s, to the great promise of MySpace, which was shortly flattened by Facebook, to the second launch of Pagesix.com, which Murdoch closed this year, after four months of operation, Murdoch's Internet starts and stops have engendered at News Corp., in the description of Peter Bale, who once ran the Web site of The Times of London and now runs MSN in the U.K., a relative 'fear or abhorrence of technology.'"

Is it really about the Internet and these new Digital channels or have we got it all wrong?

There's no doubt that many people are opting for their laptops and Google News in the morning over the local newspaper, but the shift away from reading the news is as old as the advent of radio, TV and whatever else came after that. For years, educational facilities and the book publishing industry have been complaining that the activity of reading keeps dropping year over year. Couple that with the advent of many new and interesting media channels (and yes, this includes the Internet) and you don't really have a digitization of the newspaper industry that is killing it, you simply have more choices and options for the average consumer than ever before.

Newspaper have never been heavily into the concept of innovation.

They always owned a large portion of the local market and that's what attracted (and continues to attract) most advertisers. My guess is that newspaper publishers saw the Internet as an additional distribution channel to demonstrate the quality of their content and get the mass public interested in buying their paper products. When that conversion never came to be, and the realization set in that people were more than fine with just reading the news online or grabbing some quick headlines from an iPhone app, the game needed to be changed again.

It's been documented and debated to death.

Whether the newspaper and magazine industry made the right choices is not as important as the business choices they are about to make. If they choose to charge for the content that has been free for almost 15 years now, they're sure to have some semblance of a revenue stream, but there will be other media companies who might come along and offer up that content again for free (and figure out some other kind of revenue model beyond paid subscription). If they choose to no longer let companies like Google serve up their content in their generic search results, fewer people will be exposed to those traditional media brands. If they leave things as they are, they are somewhat stuck in a model where there is a tremendous amount of Internet traffic but not enough advertising interest to support it.

How can you charge for something that was free?

Simply put, you can't. But, you can charge for premium, new and different kinds of content. Perhaps if these newspaper and magazine publishers actually embrace the idea that "publishing" online is more than just copying and pasting your traditional media text onto the Internet, there may be many new and interesting money making ventures ahead of them (at first glance, charging for a great iPhone app is one, small way). From audio, video, images and yes, text, to a better understanding as to how tools and platforms like Blogging and Twitter are moving us ever-closer to a real-time publishing world, perhaps these publishers can really start developing and marketing new publishing tools and pieces of content for the Internet, mobile and whatever new digital platforms are going to be developed in the coming years?

Publishers need to understand that the future of publishing is not about charging for what they used to create, but rather charging for newer types of publishing platforms and pieces of content we can't (and couldn't) get somewhere else.

By Mitch Joel


Comments Comments Feed
  • Posted by buzz
    Mitch Joel

    The only chance papers have is to get in with a paywall now in the app store. With a tablet Mac just around the corner, one that will definitely have app store capabilities, the only way information can get behind a paywall is if it's done right at the beginning.

    The web is free, they tried pay in the late 90s and it didnt work. Pay works for music because the free versions are sketchy in quality. Information, however, is already being produced for free by quality outlets like the CBC - that will never stop.

    It's tough to scrape up all the information and toss it behind a paywall - the only hope is the mobile app store.

    There's more here: http://www.cyberbuzz.com/2009/10/02/why-information-is-free-but-music-isn%E2%80%99t/

    Reply
  • Posted by Jeffrey Stewart
    Mitch Joel

    Sorry, no they will not. Time and time again old media companies try to force, or threaten, or somehow protect their content. But consumers time and time again show that they do not want to pay for content. But they will pay for convenience.

    Reply
  • Posted by Cheril Hendry
    Mitch Joel

    Absolutely NOT. Look at history. And common sense. The pubs that entered the information-giving online world at no charge to customers will never be able to charge for content. Primarily because there will always be competition of equal quality that will never charge. These pubs need to think out-of-the-box for their next revenue generation product, like charging for links.

    Reply
  • Posted by Miles Maker
    Mitch Joel

    There's absolutely NOTHING about current news worth paying for--it's mobile, social, in real-time and already FREE in abundance. WTF?! Will paid news be more accurate and credible? Will the information be exclusive to the content provider? Will paid news be delivered in some new or innovative way? Maybe I just don't 'get it,' and I'm okay with not 'getting it' when there's a price tag hanging from the source.

    Miles Maker
    Transmedia Storyteller, Movie Tech Blogger and Social Business Strategist
    Converciné Communications: http://www.convercine.org
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    Reply
  • Even if you are willing to pay for content, those you want to share it with may not.

    For example, some links to content from the Globe & Mail require payment after a period of time. This is worse than blocking content from the outset (as the Wall Street Journal does with some content). The Financial Times seems to restrict how many times you can view content from their site. This content is probably available online for free through your public library.

    How can you share links to content that may be blocked? You can't because you'll annoy the recipients. The easy solution is to switch to other sources. There's so much choice. Publications with restrictions lose. By removing themselves from the conversations, they lose relevance in today's connected world.

    Reply
  • Posted by Yves Roy
    Mitch Joel

    Briefly, I think the media market should take a look the way airline took the bull by the horns to find ways to increase their revenues by pinpointing chargeable services offering add value (most of the time) and to understand the behavior of customers depending of the destination and the purpose to travel (ex: vacantion, business, family). Media world must have a different eyesight of the actual market and look up what other business have done if they don't want to be left behind and crash by go getter entrepreneur's

    Reply
  • Posted by Ken Wong
    Mitch Joel

    Just as movie theaters continue to exist in an era where competition from free content is highest, newspapers and magazines can charge for content....BUT If they want my money - or more importantly, my time - then the content must be better than when it was free.

    "Better" doesn't mean better news or even the odd scoop...how do you compete against a community of people sending reports via social media?...But make it more insightful and better written. Supposedly they have professional staff who can provide more background and perspective: just look at the newsletter business for evidence we'll pay for the service. They would therefore need to start training and paying reporters better and do a better job of selling/promoting their marquis value reporters. Example: tell me the best reporters and columnists in your local paper?

    "Better" doesn't mean more novel topics either...I can find people online who share my interests...but they can charge if they can alert me to trends: look at all the folks offering subscriptions for trendwatching. Again there is a staffing implication

    And "better" doesn't mean more opinion. There are lots of free opinions available (like this one). But where is the imprimateur of quality? They need to stop telling me what to think and instead giving me impartial and verified information I can use to think for myself. Imagine...integrity as a differentiator...oh...wait...that would make them a "brand" wouldn't it?

    At the other end of the spectrum...if they could add something to their classified service...going beyond the listing service which I can get for free online...I might be willing to pay for local access. Perhaps some verification of sellers? Warranty? Low cost place/way to pickup goods I buy?

    Or break the current practice of using syndicated and wire service sources for everything. Local nwsppers are like shopping malls these days...the same chainstores/wire service stories in every one. People will pay to see their cjild or neighbour. The easiest way to compete against a global competitor (like the internet) has always been to focus on local content


    So there are services I would pay for...but trad'l media must understand their monopoly is over and give me good reason to do so

    I like a fusion model used by Ad Age and some others...the model would allow fir a basic subscription to be enhanced via digital offerings like a digital edition (for a fee), archive access (for a fee), database access (for a fee) and access to key writers' personal columns/insight (for a fee). On this model the print version is a part of a suite of related services instead of trying to be all things. Good news for Canadians...the Globe & Mail (and to a lesser extent, the National Post) are moving in this direction.

    Most of all, the media should understand that behind the content I'll pay to get are PEOPLE and DATA. If they cannot offer me exclusive or more convenient access to the people and data behind the content, then why would anyone pay for something they can get elsewhere for free.

    Ted Levitt, the capa de gurus at Harvard captured the issue perfectly...way back in the 60's when he wrote Marketing Myopia. He said then...movie theaters and broadway need to stop competing as movie theaters and broadway to compete against the free content on TV. They need to recognize they are in the "entertainment" (or even the teenage "date") business. Then they would realize that we pay because...it's a BIG SCREEN...with BETTER SEATS...WITH BETTER SOUND...and maybe 3D...with concessions beyond pop and popcorn...etc. Imaine what newspapers and agazine COULD charge for if they started being in the "relevent information" business...

    Reply
  • Posted by Scott Bowman
    Mitch Joel

    The big day of the newspaper was back before everyone had a radio. Before television, and before this thing call the Internet. Newspaper moguls built empires delivering papers to the masses that had very little few choices for getting information. Not everyone had a radio.

    Today, there are so many different venues for a person to get their news and information, that it is relatively impossible for one organization to truly dominate their markets. If papers are going to survive, they're actually going to have to re-invent themselves to new media companies. Most think they have already, but they really haven't. There's no reason why a news organization that focusses on print can't turn the majority of their stories to audio, video and interactive online presentations.

    They already have most of the infrastructure in place. Field reporters, newsrooms, editors, etc. Instead of investing in new presses, they need to invest in cameras and servers. Creating compelling content, delivered where the people are (online) and in a timely fashion really is the only way they are going to go from a free model to a paid model. Just posting a print story online isn't going to do.

    I think one of the real concerns is, if the news organizations don't adapt to the new way soon, who is going to keep people honest? Over consolidation makes it too easy to gloss over and bury the real stories. Extra Extra. Read all about it.

    Reply
  • Posted by Jamie Favreau
    Mitch Joel

    On a local level from an industry point of view. Crains Detroit offers an Online version and they have a subscription base for premium content. This seems to be working for them and there clientele. Since it is basically a business journal they have a select audience which they are trying to inform.

    Will this work for a major newspaper probably not. I doubt you can go from free to have a subscription when there is so much competition for visibility and validity to begin with.

    Reply
  • Posted by Ian Rountree
    Mitch Joel

    Murdoch needs to be aquainted with the Streisand Effect. Any of these schemes might work - if the goal is protecting content and not creating revenue and consumer base, they've got dozens of paths of possible attack. The trouble is, because of the nature of the internet, the chances of zero-leakage are fairly thin.

    When your entire strategy is "Impliment, Impliment, Impliment" the ripples can get lost in the shuffle of activity - and, considering the internet is built on the ripple effect (hello, Google Wave), when you lose site of the ripples, you lose site of the vast bulk of benefits the internet can provide.

    Reply
  • Posted by web development
    Mitch Joel

    Thanks for the post.It is a good topic for discussion.With the activity of reading dropping each year,one must look at other alternatives to keep their businesses alive.Liked the way you've ended your post.They should start charging for newer types of publishing platforms and pieces of content that is not easily available.

    Reply
  • Posted by Heath
    Mitch Joel

    The most illuminating quotation from Wolff's VF article on Murdoch: "At The New York Times, it was the op-ed columnists themselves who objected most of all when a paid wall choked their readership and notoriety."

    Reply
  • Posted by Al Andersen
    Mitch Joel

    Save a tree, kill a keyboard. Trees create oxygen, keyboards create ideas and connect us to each other. We can get news anywhere for free. Life is not pay-per-view. People are tired of getting their news from the driveway. It is too local and isn't pre-sorted for content that they want. Long live online!

    Reply
  • Posted by Kerin Donahue
    Mitch Joel

    I just got a notification that Strategy Magazine's online publication Media In Canada will be changing to a paid content format. Upon further investigation, it turns out that Marketing Magazine has plans to do so as well. Media In Canada and Marketing Magazine are great resources, but it’s really grinding my gears that I will have to pay for content that I’ve been getting for free. I’m also reminded that my favourite online publication One Degree stopped their presses recently due to fiscal considerations. Is there no one left? Is this the state of things to come and I should just shrug and suck it up? A hundred bucks is chump change for a company but for someone like me it’s one more bill and really, one more decision: a subscription to Media In Canada or attend the XYZ conference that will provide me with learning and networking opportunities? Eeny-meeny-miney-mo…

    It seems to me that the ones most affected by this change will be, as always, the little business owners like me who don’t have big marketing budgets. Who cares about us anyway? We don’t affect anyone’s bottom line but our own. Tough tiddlywinks to us!

    In an industry that is more and more touting the trust economy, the failure of mass media to connect with its audience and the success of niche marketing, this a sad state of affairs.

    Reply
    • Mitch Joel

      Kerin -

      I am surprised by your comment that Marketing magazine intends to start charging for our twice-daily MARKETING DAILY e-newsletter. We do not currently charge for access to the complete enewsletter, nor do we have any plans to do so. Whatever source provided you with contrary information is incorrect.

      Christopher Loudon, Executive Publisher & Editor-in-Chief
      MARKETING magazine

      Reply
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