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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."
As a /. subscriber I guess I'm proof positive they will pay. Not only do people need to feel that they are actually getting something for the money they're paying, the price also has to be right.
/. being one of the largest content delivery systems on the net, I'd be curious to find out how much revenue they generate based upon subscribers alone.
With
Perhaps Taco or one of the other "powers that be" would like to weigh in on this issue?
Mike
Do you think the freeloader mentality on the Internet is ready for change?
.02
I think it's at the turn of the hockey stick, because it's at about 15 percent of the Web population that's paying for content right now--that's still a low number. Very soon, you'll see that the content that's left to be free is content that will not be trusted; content that has a bias. Just like when you pick up a magazine that's free, and you don't trust it.
Umm, I don't trust sites on the web that I have to pay for. The only sites that I see on the web that have pay-for content are porn sites and I would MUCH rather use free sites like sublimedirectory or thehun.com just to avoid paying for stupid content. At least when I know that it is free and I am disappointed it's fine.
Will you get cooperation from some of the big media conglomerates that already own a collection of big-brand magazines, such as AOL Time Warner and Conde Nast?
Oh, we don't have them at launch, but we're thrilled to have 140 titles. We've had a lot of meetings with them--extremely positive meetings--and I'm sure they'll come into the platform in short order.
You are thrilled to have 140 titles because no one is buying into your dotcom bullshit. If anyone is going to want to pay to read stuff online they are going to do it on that site only. Perusing the titles made me think, wow, this sucks hard. I will stick to news.google.com for now. At least I get free news that is basically interesting, and if it's not on the front page, I know I can quickly search for it.
I see the Googles of the world like the freeways, where you're going from one place to the next, and that's the place to go. They have a very viable business being the main artery across the Internet. Our approach is to be a walled garden, where we bring in this very high-quality content. As a consumer, you would certainly want to use the freeway and the walled garden for different needs.
I (and plenty of others, including NON-GEEKS) see Google as God of the Internet. If I want to find an article, I search google and it finds it fast (including newspapers, magazines on the web, etc). Why in the world would I want to search your index of pay-for stuff (and limited to 140 titles currently) when I can use google to search 140+ titles on a SINGLE TOPIC in seconds? This idea is going back to Library's and making you pay to use them. I don't think it's going to work.
I just think that Google has cornered the market on this type of crap long before this guy could. news.google.com provides what everyone needs for EVERY media type.
I will stick to free content thank you.
Just my worthless
About the only way that I think I would happily toss down a monthly $fee for online content would be to have the content shipped to me on a (monthly, quarterly, whatever) basis on cd as well as the access.
;)
HTML is small, dynamic content can be shoe-horned into static, and you can always look back on the good old days (think LWN on cd. or Wikipedia, relive your first p0st over and over again on Slashdot the 99-01 collection, whatever).
I think I would even pay a premium for such as service as well (20 bucks a year for online access, or, 40 and we ship you a quarterly cd as well!)
Myself, I see the net being a little too ephemeral to be chucking down cash for something you will never get to touch or keep a library of for your own use.
My 2 cents. Now, time to go read the article!
Every expensive product in human history that faced cheaper (free is just the extreme) competition has at one point resorted to insulting their customers by calling them cheapos. "Freeloader Mentality" is a very hollow word that describes the simple fact that people make many of their economic decisions in a surprisingly economic way: As long as major news sites are free (as in beer), people won't pay for yet another one that charges them. It's that simple and ist's called competition.Get used to it.
We USED to get all TV for free.
THEN we paid for cable - but that was ok because we got out boobs, 4 letter words, and gore... commercial free.
NOW we pay MORE for cable, get twice the commercials, and have to watch edited versions of many movies.
Go figure.
So to those who say we will never pay for content on the net... what are you watching tonight, and how much are you paying again?
I am very small, utmostly microscopic.
If you're going to charge people for online only content, it's really got to be more that just what's available in print. Slashdot is not available in print and it is more than just news, it's an experience of discussion with a great deal of other like-minded people. I am part of a group that runs a successful non-porn (well maybe some) pay website. In talking to our members, the main reason people subscribe to our site and keep renewing their subscriptions is the experience, not just the content. The experience being the activity in the various message forms, the ability to rate and comment on every piece of content, the ability to parametrically search and access all content for the past 6 years (online publicaitons rarely offer that), the ability to see who's currently online, etc.
Sorry for the shameless plug, but it illustrates the point that you really can't charge for *just* content presented in the same way as print. I don't believe Salon executed successfully using this model, and I can't see how anyone else could either.
Just my 2 cents ...
I regularly post to Slashdot. I am essentially a micro-content provider to Slashdot. I have posted over 300 comments, many of them high Karma scorers. If I made, say, one cent per Karma point, then I would be about 3 dollars better off by now! Woohoo!"
Maybe a site like Slashdot could charge "micropayments" but rebate to it's users that have high moderation. This may have an effect on eliminating troll posts and encourage well thought out responses.
I pride myself in the high moderation I get here & substantial page views/responses I get elsewhere. I mainly use this site & other Mac Chat/Forums sites as a way to "micro-advertise" my website & my eBay auctions. I figure, if people think I say something interesting I must be selling something interesting ;)
Another take: If you actually sell something on eBay OR leave feedback for a transaction you are rebated or awarded a micropayment. This way, even eBay could CHARGE for content. Buy - you are deducted a micropayment - leave feedback - awarded/rebated a micropayment
Yell & scream & rant & rave... it's no use... you need a shaaaave ~ Bugs Bunny
I've been using Yahoo BillPay for over a year now at $7 a month, and I'd never, EVER go back to writing checks and mailing bills. In fact, I visit a mailbox once every 3 months because I now handle all business and correspondence online. I still have all these old 34 cent stamps to which I have to add a sheaf of 1 cent stamps in order to mail anything.
I also pay extra for Usenet access from a company that is dedicated to it. Gotta have those complete multi-part binaries, don't ya know. :) At least until the RIAA eventually goes there. :(
And I pay a little extra for an email/web space combo.
So I, personally, have no problem paying for services even thought I'm skeptical about paying for content. That's why I don't complain about advertising unless a page gives me more than one popup at a time. That's like two commercials playing at the same time on TV.
--- Ban humanity.
> We've been accustomed to free content and will tend to avoid payment whenever possible
This doesn't sound good. The nice thing about the inrnet is that people also provide the content, unlike TV where there are a couple of big channels. Actually when I search for something on the internet I usually find it in free volunteer content (usent faqs, forums, list archives, user documents, collection of random texts, discussions, FAQs, hobist info, HOWTO, diaries, articles, etc).
I myself have some data in my home page which somebody may fall into if searching google for specific terms. And they may be proved useful too.
So why should I pay. It will break this nice scheme. Then the writer of a free document will say "wtf? why am I providing this for free while others make money".
As for slashdot, its been said before: People don't come here to read the insighful comments of Michael or Jon Kaz. They come here for the comments: user supplied content.
You're missing his point (I think). The content here *is not* subscriber supported. The amout that /. takes in from subscribers vs M$ et al. has to be a drop in the bucket. If slash got rid of ads, they would probibly fold. The point is, you can't float a dot com on subscribers alone.
Take newspapers: the price of the paper to the consumer is trivial. Many papers don't even charge any more. They are supported by ad money.
On a different note, doesn't it seem like the Microsoft bunch and hangers-on spend A LOT more ad money here than Open Source?
We are exceedingly cheap.
:)
I much prefer the term "working class".
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.
Oh, we can grasp it with our tiny little minds just fine, thanks for playing. We just don't like it. There's a very big difference between not comprehending it, and not liking it.
I for one have issues with it simply because the value is just not there. Obviously if I personally paid a small amount for all of the little things that I use on the net, I'd be dead broke. It's called nickel-and-diming you to death... and quite honestly I'm already being nickel-and-dimed to death with everything else.
Sure, you say that $10 is a single days dinner. Well, I'm sure it is. $700 is someones single days dinner somewhere, too! To be quite honest, most of things I use just aren't worth the hassle of not eating for a day. What ever happened to the old days *before the dot-com era* where people did things on the net because they thought it was (awesome | fun | informative | gave something back to the community | the-next-best-thing-since-sliced-bread)? That's how Linux was started.
To be quite honest, I personally think that if you rely entirely on the web for your existence, your making a huge mistake. Unless you have a niche market, or your just damned good at what you do.
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.
How many individuals honestly go out and buy MSOffice on CD without a life-or-death emergency pushing them? The majority of the market usually ends up getting it with their system, prepackaged. Most think it's just a part of Windows.... I've known quite a few people that found out that they need MS-Office for some reason like college, and they didn't have it. (neophytes mostly, not people like you and I who are seasoned in "computers") The majority of them went to the store and nearly jumped out of their skin when they saw the price. Most of them, because of the necessity of it in order to continue with their tasks, purchased it through other means such as the college bookstore. (far cheaper because of a student discount) But, the honest to god truth is that unless faced with an emergency like not being able to do your college schoolwork without it, you just don't need it if it isn't available on your computer already. So, the media in which it's distributed quite honestly would only affect IT personnel who would then need to burn it to a CD for safe-keeping before including it into the standard Ghost image
-- This space for lease, low setup fee, inquire within!
Sorry, but it costs to create content. Even worse, it costs to deliver content (bandwidth, etc.).
./ isn't as a "contributor." I am a consumer of their product. I am consuming ./'s bits and bandwidth as I type. Most of all, I am consuming the large audience that slashdot as build up over the years for my little egotistical jaunts into cyberspace.
Most the people I know who've delivered quality content on the net rue their decision. Blogs aren't quality content.
Then there are the tons of reeders who put up put up pourly edited posts, and think, gosh look at this wonderful content I just contributed. I should get all that expensive, extremely time consuming work other people did for free. I don't buy the argument that you can measure the quality of content buy the volume of werds.
The way I see it. My participation in
The act of my typing out my pourly conceived and incomplete thoughts is an act of consumption. It is a tasty little ego trip I go through. Now lets wait and see if I get mod points...delicious little mod points.
Now, I should mention that when I speak of content, I'm speaking of things like music, movies, text, etc. Those things lose most, if not all, of their value once they become digital and reach the internet. So what can be sold?
Experiences. Slashdot is an experience, live broadcasts (think pay-per-view) are experiences, chats with famous people are experiences, etc, etc, etc.
Certain types of things DO have value on the internet, just not all of them. What is currently going on right now as the internet comes of age is that people are experimenting with it to see what sells and what doesn't. Not everything is guaranteed to sell, in fact, you may ruin your chance of selling a physical version of it as well if you unsuccessfully try to sell something on the net (RIAA again). Its a big gamble, and there will be lots of casualties, but eventually we will learn what can and cannot be sold on the internet.
A good example of how this works is in Snowcrash. Hiro does a search for something with the librarian, and filters for free content only. Yet when he needs something rare or specific, he has to pay for it. In fact, a whole profession (gargoyles) has sprung up around this business of rare/hard to obtain/unique information. Well, just my two (or fifty) cents worth.
Buy Steampunk Clothing Online!
As proven time and time again. I implemented a subscription service at IcarusIndie.com for high bandwidth areas of the site in January and have made a nice amount of money. I'm not getting rich off of it but it's enough to know it's a feasible idea. My site isn't large enough yet (and doesn't have a fast enough connection) to expect a large number of subscribers.
The problem is just like any other business, most people just slap up a site, throw some crap on it and expect people to pay. My site was entirely free for as long as my connection could take it. Which was 2 years. I then went through my log summaries, figured out what was taking up the most bandwidth and put it behind htaccess and now sell accounts to access those files.
Another thing is that you can't lock everything down. Otherwise people aren't going to be finding your site. I made sure to leave a bunch of good stuff freely available even though it takes quite a bit of bandwidth. The site is also diverse in it's content to attract people for quite a number of reasons.
The other thing is that most businesses fail. It's not surprising that there are a few big money makers and a lot of no money makers. Setting up a business anywhere takes talent and a product people will pay for. Most people don't have either.
Ben
Work Safe Porn