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Will Internet Users Pay for Content?
securitas writes "One of the most challenging business problems is trying to figure out how to make money on the Internet, especially with content. Louis Borders believes that Internet users will pay for online content and explains in an interview the how and why. He is founder of Borders Group, a $3.4 billion company that is the second-largest bookseller in the USA, as well as the billion-dollar online grocer and dotcom flameout, Webvan. Borders thinks he has found the answers and has just launched KeepMedia, an online newsstand subscription service. As someone who has had spectacular success and failure in his career, Borders' latest venture will be an interesting one to watch."
We are exceedingly cheap. We expect FREE on the internet. It's been burned into our heads since the dot com boom. At one point, "free" topped "sex" in web searches. We think if it's digitized and non-physical, we should have access to it and be able to copy it. We can't grasp the concept of monetary value for digital things. We can't wrap our brains around the idea that those digital things took work to create, and people that made them want to be paid for them. Since we can get it so quickly and easily over the internet, we just cant comprehend that.
If MS ever started selling Office exclusively as a download, they'd lose millions of dollars. Because Office just wouldn't feel like a real product to them. Put a CD in that consumers hand, though, and they're more willing to pay for it.
With the exception of Apple users, who will do whatever Stevie tells them to (buy music at the Apple Store! On your Ipod! Now!), most denizens of the internet are, let's be blunt, cheap bastards.
Life is hard, and the world is cruel
"I love Amazon but I'd say 1 slightly successful company out of a thousand, probably doesn't make a good business model."
Amazon sells books, music etc on the internet. Like people have done with ads in magazines etc. They were/are cheap and convenient. Not a new business model.
Micropayments IS a new business model. I'm not a slashdot subscriber, as i wouldn't get anything (of value to me) extra for paying.
Hmm - Maybe you should log in as a non-subscribing user and check out the huge .NET ad in the middle of the page! Somebody sure seems to be making money from my browsing...
In Soviet Rush, today's Tom Sawyer gets high on you.
You'll see people start paying for content, when distributers start pricing it correctly. Sometimes I only visit a site once, maybe twice. Do I want to buy a 20-50 dollar a month subscription to get the article I'm interested in? Obviously not.
However, I would be willing to make a 50 or 75 cent investment in a good article or two. Micropayments could be a huge boon to the net. Paypal or Visa or Mastercard ought to get their act(s) together and make it happen already
But I won't give my credit card number to a thousand different sites. I will not subscribe to a bunch of sites (recurring payments or minimum payments greater than what I'll use on my visit), and I will not enter my personal information over and over and over again. And when it comes to downloadable books, software and music, I want that content downloadable forever, or the deal's off.
Until there's a standard for centralized payments (it's fine if there are multiple payment centers, so long as they all speak the same protocol), I'm going to use Google to hunt for alternate sites for information and entertainment.
Until downloadable content is as loss-proof as a book or a CD (meaning my library doesn't go away if a hard drive goes away without a backup or I run out of space and have to kill a folder of tunes I won't listen to for a few months), it doesn't feel like you actually own anything. If you have a permanent account with permanent access, you feel like you've purchased something, and it feels like your money's afforded you a little certainty. If you only get one, two or three downloads or a 30-day cap and then you're screwed, it's just as fulfilling (and often less trouble) for others to load up bittorrent and grab a few movies and CD images. The whole download-limited purchase thing seems really short-sighted.
If you post, you make the comments that make the pages that carry the ads. Even if you don't post, you read the ads and maybe click once in a while. You're not freeloading here if you don't pay.
- Same or similar, comparable, slightly lower quality content cannot be available elsewhere for free
- They have a meaningful value proposition (people will feel like they're getting what they're paying for)
- The economy (and their current income level) allows them to have the disposable income for it...as most online content is not vital to have
A prime example (although it's not "online") is HBO. I pay an extra $10/month for it because its content is (imho) that much better than the rest of what TV has to offer. If an online service can get people to feel the same way (that their content is that much better than the rest of what the Internet has to offer) no doubt people will pay.