In Which I Debate A Media Mogul Who Insists It's Crazy To Give Content Away For Free

from the more-opportunity-for-me dept

Last week, I went on PBS Mediashift's podcast to debate media mogul Steven Brill about the power of paywalls. Brill runs Press+, one of the first companies that built a business around setting up paywalls for publications. They focus on NYT/FT-like "metered" paywalls, where you get some content for free, but if you hit a certain number of pages, you're locked out unless you pay. Brill, whose company had to sell out to a much larger player recently (suggesting it's not as successful as he makes it out to be), insists during the episode that there is no way to make money giving away journalism content for free, and insists that advertising is no way to make money. You can hear our debate starting at around 18:45 on the podcast:

There was a lot more that could have been said if we'd had the time, but I found a number of his arguments bizarre. The internet represents a huge opportunity to grow and expand a business -- yet he's celebrating the fact that the sites who agree to put up the giant padlock he's selling are "only" losing a little bit of their traffic? This is the time to be investing in and growing traffic, because as soon as free competitors come along, and people realize they don't need to pay any more, what will these sites have left? They'll have less traffic, less advertising and less subscription revenue. That's no way to invest in the future.

Separately, there was a nonsensical story about a journalism student who might get hired for a publication, but if that publication gives away its content for free, she can't pay her rent any more. I have no time for arguments like that. If she got hired, she has a salary. If a publication is giving away content for free that doesn't mean it makes no money or has no business model. Arguments like that suggest someone who has no real argument.

I am sure that the publications -- mostly regional newspapers -- that are using Press + are successful in slowing the rate of churn. Some paper subscribers probably agree to do a bundled package for the time being, getting paper and digital access. But it's not a long term solution. Perhaps for people of Brill's generation, it makes sense, but I don't know many people under 40 who subscribe to a local newspaper any more. There's more and more info available for free online. And there are growing opportunities to provide more such info.

Advertising is a tough way to make a living, but no one says it's the only way to make money online. There are lots of creative ways to make money online that don't involve pissing off your userbase and limiting what they can do. When you do that, you make the content that much less valuable, and that's no way to run a business.

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  1. icon
    Greevar (profile), 15 May 2012 @ 11:46pm

    He just doesn't get it.

    This guy is stuck on the idea that the content is what they're selling and if you're not controlling access to that content you can't bring in revenue. That's just silly. He didn't seem all that willing to listen and just rebutted with all the misguided counter-arguments that have been refuted already. This guy has no idea what he's selling. He's also ignorant of the fact that, like Mike pointed out, people will leave you for free content. It's vain (not to mention stupid) to think that nobody else can do what you do. If anything the internet has made clear, there is no such thing as unique and scarce content. People everywhere make content just for the love of content. There are journalism sites with free content, journalist blogs, and on ad infinitum. If you're charging for what other people give away, you're putting yourself at a disadvantage.

    I've been a regular reader at TechDirt for several years now and they consistently provide me with content I find worth reading and it sparks some really great debates. I haven't spent any money on the site myself being of very meager means, but I can see that you can very much give away your content if you provide goods and services for sale that make the free content you provide have even greater value to the readers. Mike has formed a loyal and supportive community around the free content he provides. He then offers the community that he works so hard to maintain things that make the free stuff even better.

    He's laid the foundation for a viral community that he can leverage as a source of revenue. The content is the lure that brings the readers in and other things that make the content more valuable to them is the hook. Free content spreads like wildfire and more exposure is always good. Had he made his model that of a paywall or metered, he would have hindered the viral nature of this community and it would likely be much smaller. It would likely be less profitable as well. Mike has rightly understood that the content is his advertising, his calling card, his bullhorn on the street to get the attention of potential readers. He also knows how to make money from enough of those readers to make a successful business.

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