RSS
Micropayments For News Represent A Huge Opportunity... For The Smart News Org That Avoids Them
from the that's-how-you-fail dept
We just went through how dumb it was for newspaper folks to keep on insisting that they need to start charging, so I almost skipped this one, but a bunch of people have been submitting Walter Isaacson's laughable plan to save newspapers: micropayments! I thought we'd done away with that last month, but Isaacson gets attention, so let's end this once and for all, and explain why micropayments for news won't work. I can go through all the basic arguments about mental transaction costs and the cost side of managing micropayments: but there's an even simpler answer.
If most newspapers switch to micropayments, someone much smarter when it comes to business than Isaacson will create a new news site that doesn't charge. And they'll make it high quality, and they'll be able to make money through other means. Hell, it will be easier because all the fools who follow Isaacson and others in demanding payment will take all the competition out of the market.
These old journalists may know something about the inverted pyramid and how to put a news story together, but they might benefit from an economics class on how competition works when it comes to pricing. In the meantime, you just know there's a smart business guy out there, just drooling over the prospect of these old line media companies destroying their own businesses.
Oh, and one final point: just as in the article we saw yesterday, note that nowhere does Isaacson talk about giving people a reason to pay for the content. He just assumes they will. I'm sure the buggy whip makers expected people to keep spending money on buggy whips as well.
If most newspapers switch to micropayments, someone much smarter when it comes to business than Isaacson will create a new news site that doesn't charge. And they'll make it high quality, and they'll be able to make money through other means. Hell, it will be easier because all the fools who follow Isaacson and others in demanding payment will take all the competition out of the market.
These old journalists may know something about the inverted pyramid and how to put a news story together, but they might benefit from an economics class on how competition works when it comes to pricing. In the meantime, you just know there's a smart business guy out there, just drooling over the prospect of these old line media companies destroying their own businesses.
Oh, and one final point: just as in the article we saw yesterday, note that nowhere does Isaacson talk about giving people a reason to pay for the content. He just assumes they will. I'm sure the buggy whip makers expected people to keep spending money on buggy whips as well.
I’m looking for research...
The Growing App Market
Innovate More. Code Less: Optimizing Open-Source Utilization
I have an idea...
Founders, Funders, Farmers, Fools, And Family
App Developer Conversations: Successful Fundraising Techniques
I’m looking for policy...
Developers On Patents: Five Employees, Six Lawyers
Application Developers Alliance Applauds Schumer Plan To Introduce Patent Legislation
Reader Comments (rss)
(Flattened / Threaded)
[ reply to this | link to this | view in chronology ]
Re:
[ reply to this | link to this | view in chronology ]
Re:
Just my 2 cents. Time = Money.
[ reply to this | link to this | view in chronology ]
Just sayin'
not to mention: biased, slanted, not true or only half-true, never tells you the whole story, is based on false assumptions and a world view that does not include ideas like truth, objectivity, integrity, professionalism.
Yeah, why would anyone pay for such a product??
[ reply to this | link to this | view in chronology ]
Re: Just sayin'
[ reply to this | link to this | view in chronology ]
Re: Re: Just sayin'
[ reply to this | link to this | view in chronology ]
Re: Just sayin'
Look how a lot of software vendors go with Linux distributions. The software itself is free, but additionals like support aren't. Value is being 'added' by the vendor in order to compete with the essentially free and infinite quantity of the product. Similarly, some bands are giving away copies of their CD at a gig (the printing cost is negligible and easily covered in the ticket price) but making the money back in not just ticket sales but tangible products.
So maybe if the news companies looked into how they could create value with what they can add to the 'news', they might do better, rather than charging for 'distribution' (a model based on scarcity and cost of production). One option might be finding some creative use for their archives, and charging for access and some uses of those.
[ reply to this | link to this | view in chronology ]
Maybe not now, but...
Much as people sometimes imagine otherwise, we could not get our daily news fix from amateur bloggers alone.
I used to use avantgo on a cheap PDA to carry content round with me. If I could have my only personalised mix of daily news and weekly analysis articles aggregated onto my Palm in one morning online burst, I would actually be quite happy to pay for the convenience of that. And they could make a free version with ads to stop the "smart guy" in the this article wiping them out, but on my small screen those ads would piss me off bigtime. Note that my PDA did not need to be online or even have a true browser.
Yes, I can read news for free on my laptop, (and a lot of mags I subscribe to as well, buyt I still subscribe). Why ? The times when I want to read news are not always the same times that I am in front of a laptop. That is what magazines and newspapers offer over websites. Portability.
I may not have to pay for content any more, but I will pay for the convenience of having it delivered to me in a useful fashion.
[ reply to this | link to this | view in chronology ]
Re: Maybe not now, but...
Then there's the free newspapers and their umbrella organizations that do happen to cover the stories you're referring to. AWN and ANN come to mind here.
[ reply to this | link to this | view in chronology ]
Micropayments would be for old news, now current
It's a niche use scenario, but I've come across a couple times where I wanted an old article, but the $3+ cost wasn't worth the effort.
[ reply to this | link to this | view in chronology ]
Re: Micropayments would be for old news, now current
Actually, I disagree. Techdirt, for example, gets significant traffic to our archives. If I blocked that off with micropayments, there's no way I could envision making up the cost of lost advertising through micropayments.
You'd kill off about 25% of your traffic off the bat.
[ reply to this | link to this | view in chronology ]
Couch writing
Good journalism costs money. It's not free to send reporters to cover our troops spread throughout the world.
[ reply to this | link to this | view in chronology ]
Convince me and make it easy
Rule 2: Don't forget that time=money.
I pay for Kindle books because I value the convenience of carrying 10 books around with me, since I like to read. Wireless delivery of those books is the killer feature. Can I get some of those books for free? Sure, but I don't want to spend time(hence, money) looking for them. But I do occasionally download free ones available from places like Project Gutenberg etc.
Can news organizations provide enough value for me to consider paying for it, given the possibility of aforementioned smart businessman making stuff available for free? That's the crux of the matter. Run-of-the-mill news stories won't cut it. Maybe editorials or opinion pieces? Not sure.
[ reply to this | link to this | view in chronology ]
the day is coming
You may not like it but you need real reporters, even if you don't think they are telling you the truth, the whole truth and nothing but the truth, to go out there and get the stories, and that cost money.
Seriously, you want to rely on bloggers and the public to generate the news? Come on, no one is that stupid.
[ reply to this | link to this | view in chronology ]
no it isn't
[ reply to this | link to this | view in chronology ]
Why would I pay for crap?
[ reply to this | link to this | view in chronology ]
Lost me as a customer
[ reply to this | link to this | view in chronology ]
Micropayments YES!
Readers who say they won't pay for content are - from this working journalist point of view - little more than thieves.
Would you feel equally comfortable with lifting a magazine from the newsrack while the clerk wasn't looking?
It's time to grow up and realize that real people create the stuff you're reading and they need to pay the rent just like the rest of you!
[ reply to this | link to this | view in chronology ]
Re: Micropayments YES!
First of all, as has been detailed repeatedly, most publications are *not* paid for by the readers. Those cover the physical printing costs, but that's about it. The money has always come from advertisers.
Also, you could get away with charging for a *physical* product because there's real scarcity there. In a competitive market, where there's no scarcity, basic economics (i.e., reality) says you can't charge.
Readers who say they won't pay for content are - from this working journalist point of view - little more than thieves.
Really? Pray tell, what was stolen.
You read this article for free, and thus, by your own warped definition, you are a thief.
Would you feel equally comfortable with lifting a magazine from the newsrack while the clerk wasn't looking?
Don't be an idiot. That's a SCARCE product that would then be lost. That's not the case with content online.
It's time to grow up and realize that real people create the stuff you're reading and they need to pay the rent just like the rest of you!
Honestly. For a working journalist, you should try READING sometime. No one said that there aren't models to get paid. In fact we've been detailing them quite a bit. The point is that getting paid by micropayments DOESN'T WORK no matter how much you wish they would.
I *am* a grown up and I understand economics. I would suggest that rather than whining, you take an economics class or two before telling others to grow up.
[ reply to this | link to this | view in chronology ]
What is the revenue source for the small news org?
[ reply to this | link to this | view in chronology ]
Isaacson? Are you serious?
[ reply to this | link to this | view in chronology ]
Micropayments
advertising is essentially a micropayment system and it works.
[ reply to this | link to this | view in chronology ]
I just Flattred this for the sake of pure irony
[ reply to this | link to this | view in chronology ]
Add Your Comment