OSAM – Week 5: Monetisation #1
The newspaper publishing crisis in a nutshell
Here’s a link to a report on the NUJ’s New Ways To Make Journalism Pay conference from blogger Ian Wylie.
[more here]
Biggest problem we face now: how to make media pay
Only 5% of people say they are prepared to pay for online content
Facebook addicts aren’t even willing to pay for Facebook
Why don’t people want to pay for online content?
- 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 (eg BBC in the UK)
http://www.theatlantic.com/magazine/archive/2010/06/how-to-save-the-news/8095
Different business models
Paywalls and premium content
How does it work?
Block access to users unless they pay for it: subscription or per-content payment.
Pros:
- simple to understand
- mimics usual print business model
Cons:
- People don’t seem to want to pay
- Doesn’t really understand the changes in information consumption
- Excludes casual visitors who might be valuable in other ways (Steve Yelvington writes about this here)
Murdoch has declared he will raise paywalls for NewsCorp papers – hasn’t done this for his high-profile titles though. (He has done it for some obscure local US papers though)
Some examples of paper that have done it: Financial Times, Wall Street Journal, Economist, Variety
Read more about this here: http://www.sfnblog.com/financials/2010/01/dow_jones_local_papers_follow_others_in.php
Here’s a useful analysis of 30+ premium and paywall models by Microsoft:
Variants on the paywall
Try-then-buy
FT.com gives limited article access before cutting you off – 30 articles a month with free registration
Added value offers
Local site Manchester Confidential offers a range of sweeteners for readers – deals, offers and competitions. It gavce up on the idea of charging for itself though.
Micropayments
How they work:
Users pay a tiny amount for seeing an individual article. Over time this revenue amounts to a significant income
Pros:
- Users pay for exactly what they use
- Understands the move away from packaged media content – similar to the “albums-to-tracks” move with MP3
Cons:
- Very fiddly and not user-friendly
- Goes against whole trend of unmetered tech services (mobile bundles/monthly broadband etc)
Clay Shirky rants against micropayments here.
I rant about micropayments here
Aggregated revenue models
Some in the media have been getting very excited about the idea of aggregation models to pay for journalism.
Donation-based
Here’s one example of one that relies on reader goodwill: http://www.editorandpublisher.com/eandp/columns/stopthepresses_display.jsp?vnu_content_id=1003940234
How it works:
Register with a single payment site. Sign up for your chosen monthly subscription. Visit sites that are registered with the payment site. Your visits are tallied up and your subscription is divided up among the sites you visit.
Pros:
- Avoids need for micropayments
Cons:
- Really hard to understand
- Relies on that elusive 5% of people willing to pay for online news
Paywall-based
A more sophisticated version is proposed by Press+
How it works:
“Simple, one-click tool to purchase, track, and manage paid content using a single account. Once readers have registered for a universal Press+ username and password, they may use the same login credentials to purchase content across all Press+ affiliate web sites.”
Pros:
- Could be relatively easy to use
- Avoids need for micropayments
Cons:
- Still relies on that elusive 5% of people willing to pay
- Is the content you want on an affiliated site?
- Not sure anyone is actually using this service
Other ways to monetise
Selling on to bigger players
If Guido Fawkes can get £20,000 from a newspaper for a political scandal story, he’s not going to give it away for free on the web. (via Ian Wylie)
Con:
Requires an existing media industry with the money to pay you for it
