Will people pay for content online?
Clay Shirky and Steven Brill were discussing the above question on Mckinsey. Please have a read.
I think both Clay and Steven have made excellent points and I do think there is a fine line as to when a user would or wouldn’t pay. In simple economics, when there is a demand, there is a supply. I feel that online content will be the same too. Let me give some examples 1) Movies, 2) Books, 3) News / magazines. I will describe when consumers would pay for content and when they wouldn’t. I believe these are popular content types that are used by the average internet user.
1) Movies. Would you pay of it online?
Yes and no. Its becoming slightly harder to download from illegal sources. Even though its still rampant, laws are been erected to protect media companies. Its only fair that way, they make good movies, someone pays for it. Some people are also watching these shows being streamed online in places like Hulu. Since there are quite a few channels for free movies, why would anyone buy? I would for sure.
Movies from other sources are not fully trust-worthy, troublesome to get and potentially of a lower quality. With a media device like Apple TV, you rock up at home after work, really tired and feel like a movie and a beer. Switch on the TV, select the movie you want to watch and buy it. At the same time, whip up a simple dinner and movie is ready to be watched. There is a demand here – a demand for the latest blockbuster which is easily accessed, high quality movies with no security risks and almost real time. I would pay in this instance.
2) Books
eBooks is pretty much a double edge sword. eBooks allows publishers to reach consumers faster and environmentally friendly. As compared to paper books, ebooks are cheaper as well. However, that allows consumers to start trading it online and uploading it to random sites. Opps, that’s a problem – free books online. However, if ebooks publishers could restrict ebooks from being shared, they could create a demand. As far as I heard, ebooks takes a long time to get “shared” online and the demand for such books online could potentially be slightly lower and since we could assume that people who buys books are slightly more educated, there is an ethical commitment to pay for it. Moreover ebook readers are still not extremely common and downloading an ebook would mean users would have to have their laptop (not everyone has one) to read their book in bed before bedtime. All these reasons could contribute to the reason why book publisher’s revenues are not as affected as media companies.
3) News / magazines
News and magazines are an interesting one. If it is straight up world news on the latest bombing or political news, I won’t pay for it. There are way too many sources to get it free. However, certain news, especially financial news and business commentary, could potentially be worth alot because of the structure and data. These information is not freely available or requires time to consolidate and for busy people in the world they could be willing to pay to reduce some redundant work load. In my opinion, people will be willing to pay for quality data and information at top tier news sites. This could potentially be a problem for regional publishing houses with a small circulation. Their revenue stream will be deeply affected.
In many magazines that are still surviving, what could be done to provide a demand is to aggregate information for readers. Let’s take the popular female magazine – Cosmopolitan (or Cosmo in short) as an example. Alot of the gossip news published on Cosmo can be found online and readers could get it free. However, what Cosmo does is rather interesting, they have articles about fashion, love, cooking, leisure, gadgets and a whole heap of other content. They aggregate content for their target readers which then allows their readers to benefit from a one-stop shop for all their feminine informational needs. Would their target audience pay for it? Well, my female friends do.
Conclusion
I guess in any case, there must be a scare resource/content for people to pay for content. Companies must create a specific demand and meet specific requirements that will convince users fork out and part with their money in exchange for the content and/or services. Content by itself is freely available and I agree with Clay but we can always bundle content up with some value added features and sell it at a premium.
What do you think?
Add A Comment