Micropayments For News — Holy Grail Or Delusion? 234
newscloud writes "Harvard's Nieman Journalism Lab sounds off on micropayments for news content, on the side of the argument that says they are a dangerous delusion: 'What does it mean for journalism? It could mean charging for different platforms, for early alerts, for special members-only access to certain premium or value-added content. But I'm pretty sure of one thing: It doesn't mean charging people fractions of a cent to read a news story, no matter how sophisticated the process.' The article provides good context on the debate over micropayments from a 2003 piece by Clay Shirky, to recent analysis and opinion by Masnick, Outing, Graham, and Reifman. Google's micropayment plans were recently discussed here."
Premium content (Score:5, Insightful)
If the content is premium content, something that I know is more valuable or interesting than elsewhere, then I have no problem paying for it. This is the reason people for pay for Wall Street Journal and the likes too - they get more out of it and the writers are specialized in the area.
For everyday news, no. I want opinions and better writing than just simply telling the news.
Here's a crazy idea... (Score:3, Insightful)
Micropayments (Score:2, Insightful)
NPR (Score:3, Insightful)
How about "Holy Grail and delusion" (Score:5, Insightful)
It's the Holy Grail of media outlets, because it would get people to pay for something that has been given away for a long time. But it's a delusion as well, since efforts at doing just that have not met with anything remotely like success.
For instance, the New York Times tried to do a "Times Select" paid service with a lot of formerly free content available for the low low price of $10.99 per year or so. It must not have worked, because a few months later all the content that used to be hidden behind the paywall was placed back on the free site.
Advertising (Score:5, Insightful)
With a very few exceptions, news is worth what you can get advertisers to pay for access to the consumers. This has been true since the advent of television journalism half a century ago.
It's the newspaper's own fault that craigs list took over classified advertising. They had the better part of a decade to get their acts together and get the ads online before craigs list existed. And it's their own fault that they still haven't learned the Google advertising lesson so that they're still serving worthless banner ads that many if not most of the browsers block.
If they continue to refuse to embrace their new reality, they will continue to fail. Such is fate.
Experience goods (Score:5, Insightful)
If the content is premium content, something that I know is more valuable or interesting than elsewhere, then I have no problem paying for it.
The problem with that argument when applied to newspapers is that news is an experiential good [wikipedia.org] and by definition you cannot possibly know if it "is more valuable or interesting than elsewhere" until after you have the information. So you have to pay for it and hope that it turns out to be valuable. You can rely on the reputation or reliability of the source, but that still doesn't tell you in advance that the information is good. Even if others tell you it is valuable, you might not find it to be so - think of a movie that all your friends like but you don't.
News content wont be beholden to advertisers (Score:5, Insightful)
Can you not see a simple solution when it's staring you in the face? Has Rupert Murdoch out-foxed you all? Create an independently funded public institution, with a mandate to "educate", "inform" and "entertain", and maybe the citizens of the USA wont score so poorly on survey questions such as "were WMDs found in Iraq".
And your news content wont be beholden to advertising interests.
Re:Premium content (Score:3, Insightful)
If the content is premium content, something that I know is more valuable or interesting than elsewhere, then I have no problem paying for it. This is the reason people for pay for Wall Street Journal and the likes too - they get more out of it and the writers are specialized in the area.
For everyday news, no. I want opinions and better writing than just simply telling the news.
On the contrary, I want news -- instead of this ridiculous sensationalism. And I don't want it filtered through anybody in terms of opinions. If Jimmy, 5, falls down the well I want the news to report: 5-year-old Jimmy falls down the well, and not: WELLS SLAYING OUR CHILDREN, GOVERNMENT IGNORING.
Re:NPR (Score:5, Insightful)
Advertising on the internet doesn't work because they're doing it wrong. The more in your face they make it, the harder we readers concentrate on ignoring it, and when it gets too outrageous we put in ad blockers. ADVERTISING SHOULD NOT MOVE IN A PAGE YOU'RE TRYING TO READ. When I see a page of blinkey flashing twirley ads with two paragraphs per page, I know that the site is pure shit and is only there to garner cash for some greedhead. They're lucky if they get me to read the first page.
The lower overheads need to come in the form of lower wages for the top earners. Millions of dollars a year, even hundreds of thousands per year for ONE single employee is ludicrous.
Re:Premium content (Score:3, Insightful)
On the contrary, I want news -- instead of this ridiculous sensationalism. And I don't want it filtered through anybody in terms of opinions.
In which case you want a Reuters feed, or similar.
Analysis, opinion, these are value-adds. Many people *don't* just want to know what's happened. They want to know what other people think about it - people who are paid to be knowledgable, or merely entertainingly opinionated or outrageous.
Ridiculous sensationalism isn't to my taste -- but lots of people seem prepared to pay for it.
more news balkenization and trolling (Score:5, Insightful)
Re:Here's a crazy idea... (Score:5, Insightful)
Eventually, some portion of what you are paying for the container goes to pay for the content. In the case of newspapers, it's actually a significant portion. A newspaper costs a few pennies to print, and even with delivery and markup, the bulk of the money the newspaper company is paid is for content, not the printing of hieroglyphs on thinly-pounded dead trees.
Also, digital distribution is far cheaper, but it isn't free.
I agree that digital music and other information sources are more expensive than they seemingly should be. But micropayments might help solve that problem. Headlines and a brief summary are either free or available on a really dirt cheap subscription (a dollar a month, say). If you want to read a full article, you pay a penny. Read an entire newspaper's worth of articles of interest to you, it'll cost you a quarter or so. Compare that to the 75 cents to a dollar that a newspaper costs today on paper, and that's probably a pretty accurate reflection of how much of your money today goes into content.
A lot of the free news sites are actually making money on ad revenues, and hopefully that will support decent journalism, but I know my local paper is laying off people (including reporters) left and right because they aren't being paid enough to reprint their news, and print subscriptions are down. Someone's gotta pay a reporter to go out and collect the news, and analyze it, and write it up. Someone's gotta be paid to fact-check, and spell-check, and digitize photos. Someon'e gotta get paid for decent layout (whether it be print or web). Someone's gotta get paid to maintain the web servers and the Internet connection.
It's All About Circulation (Score:5, Insightful)
Point in fact: when I lived in Omaha, Nebraska I bought a copy of the New York Times every day and read it on the treadmill.
Now, I live in New York City where the New York Times costs $2.00 a copy. I have bought it about three times at that price.
In short, micropayments is a sure way to send people somewhere else for the news.
Re:Experience goods (Score:3, Insightful)
Nonsense. You get to "experience" a periodical in every issue. Every issue
is an opportunity for that periodical to prove itself. Even if the content
is only available in hard copy you can still easily browse it and all of
it's immediate competitors (library, bookstore).
The character of The Journal doesn't change from one day to the next.
Neither does Fox News.
Re:News content wont be beholden to advertisers (Score:3, Insightful)
We could call it "PBS".
Re:Premium content (Score:5, Insightful)
If it's truly premium content, then I can see justifying paying for it.
However, the real problem is that most newspapers think that their editorial content is almost as good as the WSJ and the like. But the sad truth is that it's nowhere near that. It's not indepth, it's not researched, it's not thorough, hell, it's not usually spell checked. And every newsroom I've ever been in believes they have great content. In spite of the fact that most stories are PR pieces or written by someone else who emailed it to the features, sports or news desk.
And yet the newspapers think that they'll make more money by putting this crap behind a pay wall. In reality, they'll just get fewer hits on their website, and thus ads, and will end up lowering their revenue way more than what they charge for access to their 'premium' content.
If they wanted to actually increase revenue, there's a simple solution.
1. Create compelling content
2. Charge a premium for ads around that compelling content.
Compelling content = more readership which means more ad impressions which means more ad revenue. Yes, compelling content is hard. But it's the only way for newspapers to make it in the future.
Yet every paper sees it as giving content away for free. And they're all idiots. They provide a real service - information. They just need to figure out how & who to charge to optimize their bottom line. Because advertisers, especially local ones that are impacted by that compelling content, are willing to pay for good quality ad hits.
Re:Here's a crazy idea... (Score:4, Insightful)
That's the thing -- we've NEVER paid for content, we pay for its container, whether it be a book, a newspaper, an album, or a DVD.
I kind of sympathise with your angle, but it needs firming up. A blank notepad is cheaper than a novel or a newspaper. A DVD-R is cheaper than a DVD. So we *are* paying for content. ... and the content is far from being free to create.
Yet, to me at least, the content is less valuable without the packaging. A printed book is worth more to me than a PDF, simply because I can read it in more comfort. It's the combination of content and format that has value.
The problem comes as digital formats become more ubiquitous. If I owned an eBook reader - a better one than is currently available - then possibly a digital copy of a book or newspaper would be worth more to me than a printed book. This is already happening for music: lots of people actually prefer to have MP3s instead of CDs.
If digital distribution is the future, *and* we somehow believe that digital copies should not be paid for, then how does content get financed? I don't know the answer. I'm fascinated in seeing how things work out.
For news, at least, I think that competition will push consumer prices towards zero, such that pay sites won't be able to compete.
Re:Micro (Score:4, Insightful)
Yes, but anything smaller than a million dollars is chump change for these rich greedheads, so a buck IS a micropayment -- to them.
Re:Micro (Score:3, Insightful)
I think this is one key point: micro payments need to be micro. I'm not paying $.25 to read the on-line version of an AP article on the NYT site. If you figure there are 100 articles in the weekly edition of the NYT, then a single article is worth something less than 1/2 a cent, in print. If you eliminate the printing and distribution costs, say 1/4 or 1/8 a cent per article. I might pay a few pennies to read the entire site, but I'm not willing to pay anywhere near the dead-tree price for on-line news.
Another point: whatever they take for micropayments it has to be something easy and ubiquitous. I'm not jumping through hoops so that I can pay 1/8th of a cent to read the obits. And whatever it is, it can't be something that only works one place. I'm not signing up for "NYTCa$h" that can't be used anywhere but the NYT site.
My personal opinion is that news will continue to be ad-supported for the foreseeable future. As technology improves and ads become more targeted, they will be increasingly effective and less annoying. Hopefully this will happen soon enough to keep journalism alive.
Re:Premium content (Score:3, Insightful)
Analysis, opinion, these are value-adds.
as is filtering itself. I bet even the GP wants his news filtered from every bag of rice that tipped over in china, or the results of some back-country bake-off. (Which might be really important news over there, but not over here.) But not every news from over there is unimportant over here. So you as everyone wants your news filtered. By someone who is likely to share the same important/unimportant threshold as you.
Re:Considering (Score:4, Insightful)
Think about this: when a reporter covers an area that you're an expert in, how much do they get wrong? For instance, if you know a lot about computers, how often do you hear a reporter completely misrepresent something or get some key fact exactly backwards? Now extrapolate that to EVERY area of expertise (except possibly sports) and determine how reliable journalism is. Unless there's a video of the actual event (and I mean a video as it happens, not Bob from the Washington Bureau shaking his head as the ambulances drive away) you can pretty much count on getting half the facts, badly distorted, and intentionally slanted to fit the reporter's (or their editor's) bias.
News has ALWAYS been this way--it's just that you're noticing it more. About 35 years ago I had an article written about me in the local paper. It was filled with "direct quotes" of things that I never said, contained about six factual errors in two paragraphs, and was essentially completely divorced from the reality of what had happened.
Here, time is worth more than the price. (Score:4, Insightful)
For one simple reason, micropayments as they are debated here will never work.
When the product is too cheap, then the time and effort buying the product is the true cost to the buyer.
In other words, after a certain point, it just has to be free, or it simply isn't worth it.
What's more, if the seller doesn't value their product enough to charge a non-micro amount for it, then what they are doing is failing to make a value proposition, which is the essence of a business transaction.
No one will pay pennies for something worth pennies.
Newspapers are already cheap, but they are not free. But they aren't micro-priced either. Whether it is buying a paper at the stand or subscribing months at a time, there is a valid value proposition there.
On-line media has yet to find that value proposition. Without that proposition, debating the technical details concerning how payments will be made is getting waaaaaaaaaaaaaay ahead of yourself.
Re:News is an experiential good (Score:3, Insightful)
The problem with news is that it is an experiential good meaning you can't determine it's value in advance.
Indeed, and while we get over this with periodicals by using past performance as a guide, I'd say that this only works if you look at whole edition of a newspaper as a bundle, rather than looking article by article.
If I loved one Guardian article, I don't think that's a reliable indicator that I'll love some arbitrary Guardian article from today's edition.
Rather, I've found in the past that a typical copy of the Guardian (GBP 1.20) contains a a bunch of headlines I can skim through to get a general idea of what's going on in the world; three or four news articles I want to read in full; maybe one in-depth double page spread I can get my teeth into; some lightweight commentary; a letters page; reviews; a crossword and sudoku if I'm bored later on.
If you unbundled those and tried to charge for the separately, I don't think it would work. I happily pay the cover price for a newspaper knowing that I'll skip more than half of it. But I don't know which half until after I've paid, and neither does the editor.
Re:News content wont be beholden to advertisers (Score:3, Insightful)
The BBC is the left-wing propaganda arm of the British state;
You call that left wing? Jeez.
it doesn't drop its left-wing slant even when a right-wing government is in power
Since we haven't had a left wing government since 1983, it's pretty hard to make a judgement on that.
What is clear, though, is that the BBC is entirely separate from the government. The government authorises the BBC to collect a TV licence fee, on condition that it sticks to its charter, and there the links end. There's plenty of people who kick up a stink at the slightest hint of the BBC becoming a government mouthpiece.
Wrong argument (Score:3, Insightful)
It's worth noting that newspapers don't do radio news and they don't do television news. Each medium ultimately finds its own business model.
Paper, radio, TV news content is paid for by advertising.
The shape of internet news is already evident. The only thing missing is blog sites that start bringing in enough revenue to put journalists and researchers on staff. Suppose HubPages or Blogger decided to set up a section for hard, fact-checked news and well-respected columnists. The ad rate in this section would climb fast. Positive feedback and competition does the rest.
Headlines and summaries work for most things (Score:2, Insightful)
A few things I've found by having several news sites in my rotation.
With that in mind I would possibly pay for a handful of 'full stories' every week but for the bulk of them they're just not that interesting. I like knowing Event A happened but I don't need the in-depth analysis. But I wouldn't sign up on multiple sites and hand over payment information willy-nilly nor would I want to have to jump through multiple hoops to get access to the story. By the time that happens I will have already lost interest. Don't even start with putting down a balance on each site to have access to their content.
Re:How about "Holy Grail and delusion" (Score:3, Insightful)
Newspapers need to realize that the readers are the product, and they're trying to sell that to the advertisers.
Newspapers know that. Newspapers also know that paying readers are worth more to advertisers than non-paying readers - because the fact that they're paying shows they're "engaged".
Perhaps online news sources need to prove to advertisers that their readership is engaged in different ways. For example, a lively commenting community would be one way.
Re:NPR (Score:3, Insightful)
This is precisely why Facebook killed MySpace.
MySpace advertising: "HEY LOOK AXE BODY SPRAY HOT CHICKS YEAHH"
Facebook advertising: "Oh hey, you said you like design. These advertisers thought you might like this design book."
Even if I never buy the body spray or the design book, the former ad makes me dislike the product while the latter leaves me curious.
Re:Here's a crazy idea... (Score:4, Insightful)
The next thing you'll be telling me is that when you pay to go to a concert, you're only paying for the actual paper ticket rather than the "content" of the performance
When I go to a concert I'm not buying anything. I'm paying for a service, just like when my employer pays me for my time or I pay a barber to cut my hair or tip my bartender. When I buy that band's CD I'm buying a CD. When I hear them on the radio, it's free. When I tape it off the radio it's free. The content is free, the CD and service (concert) are not.
In the past, a couple friends made copies of something. Nobody cared. But the content wasn't "free"; it's just the potential for abuse was small.
Well, it's hardly abuse if it's legal, and in the 1970s copying tapes was explicitly legalized (it's since been outlawed). And if it was so harmless, why did Jack Valenti as head of the MPAA say that "The VCR is to the movie industry what Jack the Ripper was to women"? The fact is that the music labels decried taping and even lied on album covers that it was illegal, when it had specifically been legalized.
And distributing bootlegs WAS a problem; I remember an incident in the early '70s where Willy Nelson (I think it was him, long time ago) got in trouble when he went into a gas station and found bootleg copies of his stuff for sale and trashed the place. IIRC both he and the proprieter went to jail. Commercial copyright infringement isn't just illegal, it's wrong.
Since KSHE changed their format in 1967 and became the world's first FM stereo rock station, they've had a feature called "the seventh day" from the station's beginning and still continue today. They play seven whole uncut albums and even cue the listener to get his tape recorder ready, and still do. This is in St Louis, with a population of millions able to hear and record the show. See Birth of a label-sanctioned pirate radio station [kuro5hin.org]
When Ted Nugent's Stranglehold album came out I had it on tape a full week before it was available for sale - KSHE had played it, and I'd taped it. As that album kicked ass I bought the LP after it was for sale. This is how a lot of young "pirates" use P2P; someone will recommend something, and they want to listen before they shell out their hard earned dosh.
The internet has changed a lot of things, but as to noncomercial copyright infringement the only thing it changed was to give the media moguls something to bitch to congress about.