Friday, 16 July 2010

Paid or free?

I've been picking up on lots of debate about whether or not e-newspaper content should be paid for or free. It seems to me that the answer is probably 'either'.

Newspapers have to make money as they are (trying to be) profit making organisations. One way or another their online business model has to try to achieve this goal. Taking a little look back on how we got here might help. Initially the internet brought loads of information and news to billions for free, even a lot of newspapers simply jumped online and put their content out there (some notable early movers went into the subscription model). Obviously people grew to expect news for free (or at a greatly reduced cost) and the newspapers moved to advertising focused models to try and make some money. To make even more money out of this ad model most put some form of subscription or data collection process in place partly to help get more targeted ad models up and running to try and get more of a premium. Some are now suggesting this is still something they want to do but on top of some kind of paid content model as well. And here we are today with the next big debate on which model works best.

Now I am not a media expert, by any means, but it seems to me that what would help is some good old fashioned business modelling and research with a dose of honest answers to that old question, what are our core competencies and strategic assets (what are we good at / could we use to be good at)? Essentially the newspapers wanting to charge for their content are actually only really trying to apply their offline newspaper model online i.e. you pay for a newspaper and companies pay to advertise in it.

There is also a value : volume model to debate here. If you make the content free but get really good and clever about how you advertise can you command even higher premiums yet get to higher volumes of content consumption as well? The answer is undoubtedly yes but how to operate this sophisticated ad / content model is the difficult question.

Ultimately this debate isn't really needed as the newspapers are taking different approaches to this challenge and we will see if there is a right or wrong answer. I still think the likely answer is that either model works - it will just depend on how effectively they implement them. Partly this will come down to their global or domestic focus, but they need to be clear on what they want to achieve and their e-strategy will also need to be very clear as well.

Good luck media friends - I hope you make some money out of which ever path you choose and keep providing us with great content.

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