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Micropayments For News — Holy Grail Or Delusion?
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."
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.
I'll just get my news fix at free sites.
Easiest way to find a free alternative. Most people already pay for TV of some sort on top of internet, so if every single news outlet (including local news outlets and blogs and places like slashdot) started charging for you to view news, people would simply watch the news they already technically pay for. I have no problem paying for new news. The problem with our news is that every outlet runs the same story with their commentary slapped on top.
Advertising on the internet simply does not work, and micropayments are never going to fly. Newspapers need to adopt the NPR beg-a-thon method. They need to learn to live with lower overheads and lower revenues. Their sales forces need to convert into grant-writers and they need to focus on asking their readers and big corporate donors for money.
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.
I am officially gone from
The problem with news is that it is an experiential good meaning you can't determine it's value in advance. You only know whether it was worth something AFTER you read it. So why would someone pay for news that might or might not be valuable? Usually because the source has a track record of providing good information (New York Times, Wall Street Journal, etc) or you have some other reason to suspect that the information might be valuable (information about a stock that is not widely known for instance). But the seller of information by definition cannot know what the information is worth to the buyer in advance. Generally the seller finds out it was worth something to the buyer if the buyer buys information from them again.
There is money to be made in paying for content that can be had for free elsewhere. Apple's iTunes is proof enough of that. BUT it has to provide something you can't easily get from the free (even if illegal) alternatives. That could be convenience, it could be support, it could be complementary technology (iPod/Kindle), it could be reliability, it could be unusually insightful analysis, and it could be other things. Just copying the latest AP news has some value but not enough many people will pay for it directly.
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.
Moderating "-1, Disagree" is simple censorship. Have the guts to post your opinion.
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 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.
No. I think we all know, thanks to the movies, that the holy grail is guarded by a really bored knight of the round-table even to this day and is a common looking cup that can heal your dad's wounds, and then will cause an earthquake opening a great chasm that will swallow any (especially hot nazi dominatrix-type women) who try to grab it, instead of chosing to live...
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I sense a problem that can be solved with S****ISM (deleted as a proactive measure to stop the political-right from having a heart-attack). The BBC news is light-years ahead of anything in the USA. It's also politically independent, unlike state-run newspapers in Iran, China and Russia.
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.
Like all pain, suffering is a signal that something isn't right
Forcing people to pay for news will only increase the tendency for people to only read news they agree with. What will "save" the news industry is a shift away from creating the content to vetting content created by interested parties. While most newspapers (US) have had deteriorating quality since the Spanish-American war most in depth reporting has been done by interested parties. Groklaw is a good example of a single subject reporting. What good news aggregators should do is make it easy for people interested in SCO to find Groklaw, press releases by involved parties, and alternative views on the subject. Real "news" reform would force government, corporations and even non-profits to be more transparent in their dealings, making it easier for interested parties to research and create quality news. Tort reform to keep legal action from crushing individuals prior to judicial review (ie loser pays) would have significant impact too.
Maybe the newspapers could start charging Linden Dollars for stories? :)
Anyone like me who has published a paper newspaper knows that it is all about circulation. Every additional cent that you charge for a copy of your publication does not increase your profits. Instead, it decreases your circulation.
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.
The general public doesnâ€(TM)t put any value on the source of their 'news'. In other words, a twitter post is just as good as something from the AP. This is partially due, IMO, to shitty poor journalism, so little time and effort is spent investigating and digging for original content nowadays. Rather, today 'journalists' slap together a handful of talking points and use other news organization's reports as sources. Journalism today has by and large become a cycle of shit, thanks in large part to the freak show circus of cable 'news'.
So, I don't see myself paying Google for the same quality of 'news' I can get for free from any random jerk's blog.
FAQs are evil.
Yes, but anything smaller than a million dollars is chump change for these rich greedheads, so a buck IS a micropayment -- to them.
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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.
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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.
For those interested in more detail about the economics and psychology behind Clay's theory that micropayments will never work, I recommend this earlier piece from 2000. Nine years later, we still haven't seen a viable micropayment system (where "micro" = 25 cents or less) and I don't think that will change.
...micropayments would still seem to have an advantage over larger payments, since the cost of the transaction is so low. Who could haggle over a penny's worth of content? After all, people routinely leave extra pennies in a jar by the cashier. Surely amounts this small makes valuing a micropayment transaction effortless?
Here again micropayments create a double-standard. One cannot tell users that they need to place a monetary value on something while also suggesting that the fee charged is functionally zero. This creates confusion - if the message to the user is that paying a penny for something makes it effectively free, then why isn't it actually free? Alternatively, if the user is being forced to assent to a debit, how can they behave as if they are not spending money?
Beneath a certain price, goods or services become harder to value, not easier, because the X for Y comparison becomes more confusing, not less. Users have no trouble deciding whether a $1 newspaper is worthwhile - did it interest you, did it keep you from getting bored, did reading it let you sound up to date - but how could you decide whether each part of the newspaper is worth a penny?
Was each of 100 individual stories in the newspaper worth a penny, even though you didn't read all of them? Was each of the 25 stories you read worth 4 cents apiece? If you read a story halfway through, was it worth half what a full story was worth? And so on.
When you disaggregate a newspaper, it becomes harder to value, not easier. By accepting that different people will find different things interesting, and by rolling all of those things together, a newspaper achieves what micropayments cannot: clarity in pricing.
The very micro-ness of micropayments makes them confusing. At the very least, users will be persistently puzzled over the conflicting messages of "This is worth so much you have to decide whether to buy it or not" and "This is worth so little that it has virtually no cost to you."...
Imagine you are moving and need to buy cardboard boxes. Now you could go and measure the height, width, and depth of every object in your house - every book, every fork, every shoe - and then create 3D models of how these objects could be most densely packed into cardboard boxes, and only then buy the actual boxes. This would allow you to use the minimum number of boxes.
But you don't care about cardboard boxes, you care about moving, so spending time and effort to calculate the exact number of boxes conserves boxes but wastes time. Furthermore, you know that having one box too many is not nearly as bad as having one box too few, so you will be willing to guess how many boxes you will need, and then pad the number.
For low-cost items, in other words, you are willing to overpay for cheap resources, in order to have a system that maximizes other, more important, preferences. Micropayment systems, by contrast, typically treat cheap resources (content, cycles, disk) as precious commodities, while treating the user's time as if were so abundant as to be free.
Dear Slashdot: next time you want to mess with the site, add a rich-text editor for comments.
As usual, what will end up happening will be something between the two extremes.
Not every news site will be able to, or even want to go with a paid subscription model. Some sites that are charging for content at present, such as the WSJ, will continue to do so. Quite a few more will make the shift to paid access, only some of these will be successful in doing so, some will fold and the rest will go back to the present model of advertising.
What people will see real value in, and will be accepting of paying for is opinion, insight and thought. Current events are raw data - they happen and they're reported as-is. Where the value lies is turning that raw data into information and this is what people will pay for. As an example, anyone can walk into the Australian Bureau of Statistics and get raw import/export data for commodities. There is no value in someone else simply republishing these statistics. What there is value in is looking at the series over time, analysing the data with your knowledge of the industry, saying why things happened in the past and what they're likely to do in the future. People will pay a lot of money for this kind of information.
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Another solution.
Provide an on-line pass with the primary subscription to your local paper. Once you sign on to your local paper's internet site, you receive a cookie that permits you to access any other on-line content of the consortium for the day.
The papers get a win by increasing local readership and circulation. You don't have to worry about micro-payments. If you don't subscribe to the local paper, you're left with micro-payments to access major papers content.
Before that, it was guarded by a bunch of deranged, foul-mouth Frenchmen who liked catapulting livestock at kings and their entourage of knights
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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.
I'm a Programmer. That's one level above Software Engineer and one level below Engineer.
If only the corporate media and big ISPs could find a way to lock down the internet and control access to and dissemination of information and content... Yeah, that's the ticket!
Am I the only one who sees this as yet another argument by corporate media and big ISPs as to why they need to become the gatekeepers of the internet?
I may be wrong, but I see this as just another salvo in the war against net neutrality.
Power does not corrupt - power attracts the corrupt.
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.