How do we get people to pay for their news on the web?
What was once a desperate mirage now shows the hard outlines of a plan.
- Rupert Murdoch has threatened to dump Google and is flirting with Microsoft over selling his content to their upstart Bing search engine.
- Steven Brill’s much-hyped Journalism Online has a network of more than 1,200 publishers ready to collaborate on paid content.
- And Time Inc. is considering an iTunes-like application to charge for its magazines’ content, either via subscription or on a “per song” basis.
What else has to happen? With the news business on the cusp of change or collapse, TheWrap visits the stations of the cross on the path to paid content.
1. CRITICAL MASS
There are plenty of publishers talking about paid content. But enough major players have to move to a paid model simultaneously, or it won’t work.
The main reason for this is obvious. If the New York Times goes behind a pay wall, most consumers will simply go to the Washington Post or Los Angeles Times for free. But if a critical mass of sites decide to go to some form of a pay system -- at once -- consumers would have no choice but to pay.
"You need a perfect storm," says Elizabeth Osder, principal at Osdergroup.com, a digital strategy consultancy.
The New York Times, which once had a pay wall – TimesSelect – in place, before abandoning it in 2007, says a decision on how it will proceed with the paid content issue is imminent. “It’s a much tougher, more complicated decision than it seems to all the armchair experts,” executive editor Bill Keller told the paper’s public editor recently. “There is no clear consensus on the right way to go.”
But a growing number of publishers have looked at the bottom line. According to the American Press Institute, 60 percent of newspaper executives say they're considering paid content options. This despite the fact that 90 percent don't charge for any content online.
2. WILLINGNESS OF CONSUMERS TO PAY
If you build it, will they come?
So far, it doesn’t look good.
A new Forrester Research report shows that 80 percent of nearly 5,000 consumers polled say they “wouldn't bother” to access newspaper and magazine content online if it were no longer free.
“It's especially notable that, while publishers talk about micropayments so much you could design a drinking game around the word,” the report reads, “only 3 percent of consumers say they'd prefer this method of payment for newspaper and magazine content.”
Another recent study was not so gloomy: Of 5,000 internet users polled globally by Boston Consulting Group, 48 percent in the United States said they were willing to pay to access online news and would pay an average of $3 per month to do so.
The bad news is that the U.S. tied with the U.K. for lowest percentage among the nine countries surveyed -- and Italians said they’d pay an average of $7 a month to access news.
