When not one, but two prominent voices in the media industry come out in favor of a return to a paid model for online content, it’s time to take notice. And two did today, namely Advertising Age editor Jonah Bloom (at left) and The New York Times’ David Carr. Both correctly think that the time for an alternative, paid revenue stream has come. As Bloom says: “If you’ve got a drop off in advertisers willing to put their commercial content next to a piece of entertainment or information content … you’re going to see more [media owners] … looking to monetize that demand for their information by charging for some of that information.”
In any business, diversifying revenue streams is an important hedge against the ups and downs of the economy — the magazine business would be in even worse shape if it didn’t have two substantial revenue streams — but even if building a paid model makes sense for online content owners, I wonder if it’s too late as far as consumers are concerned; we’ve been trained too well not to pay for anything. Asks Carr: “Is there a way to reverse the broad expectation that information, including content assembled and produced by professionals, should be free?”
Carr points to the success Apple has had in getting people to buy songs off of iTunes, when much of that content could be had free elsewhere. The problem with his analogy is that it doesn’t bode well for his plea that someone invent an iTunes for news. For one, even though music content can indeed be had for free, obtaining music that way has several downsides: it’s never been legal, and downloading it can also be a great way to introduce viruses and other forms of malware to your hard drive. While that didn’t deter millions of people from using Napster back in the day, there were others, who, once there was a good, reasonably inexpensive alternative, chose to pay. It didn’t hurt that once you’d bought songs on iTunes, you could play them on one of the coolest devices ever: the iPod.
However, if an online publication asks subscribers to pay, others will still be out there providing similar content for free, and legally. It could be that a direct competitor continues with an ad-funded model or that, rightly or wrongly, potential subscribers are just fine with getting coverage of the same stories for free from unpaid content producers, be they bloggers or people who upload prodigiously to Flickr. This kind of content, which is good enough for most people, is legal, easy-to-access and only proliferating as social media channels grow.
To get back to the iTunes comparison, music buyers aren’t interested in an approximation of what they desire — good enough isn’t enough. If they want to download Led Zeppelin, getting the same songs from a tribute band isn’t going to do the trick. Unfortunately, what all this means for the online content business is that there will be an extremely limited number of publications, or individual authors, who people will willingly pay money to access especially when their household budget is getting stretched ever thinner. As for the rest of you, maybe you can start selling t-shirts and boxer shorts carrying your media brand’s logo. Now there’s a revenue stream.
