I understand completely why they are doing it - they've done the math (I've been through it with similar orgs). With only small audiences who pay they can make more money than with vast audiences who don't.
That's because those who advertise online don't pay as much as those who advertise in more traditional mediums. There has been a race to the bottom on advertising pricing which made certain of that.
Mass media publishers have learned that they can't make as much money in the networked world (where everyone is publisher, distributor and creator of their own user journey/experience) as they did in the world of control. So, they are attempting to go back to the world of control (when that genie is well and truly out of the bottle and showing no signs of wanting to return to it).
Information is free. But the way it is packaged - the experience of it - you can add a price to. Music, for example is commoditised. People don't pay Apple for music at iTunes. They pay for the packaging, the user experience, ease of usefulness. If this is what the TimesOnline etc will deliver for news content, they may have a business case. I struggle to imagine the parallel myself.
And if all they are going to do is offer access to information in the way they have done until now - but behind a paywall - then they will lose. They can only ever offer access to limited information with limited sources and processes of verification (and trust creation). The rest of the open web is unlimited in both these key respects. Open wins.
But I think through all this publishers are avoiding the key questions. Why do people pay less to advertise online than they did in traditional media? Online the Times et al can acquire greater audiences, more eyeballs. Why isn't that of higher value than print to those taking the broadcast approach to advertising? More eyeballs = pay me more - surely? Why is an online 'eyeball' worth less than an offline one?
Is it that the many digital innovations in advertising that the internet has enabled has lifted the wool from many eyes? It has shown that an eyeball doesn't equal a sale. Never did. But when you are able to measure the lack of transaction, the lack of interest, the scale of your interruptive spam - as the internet has enabled like no other medium - then the wastage of 'Advertising' becomes ever more clear.
Yet publishers persist with pay-for-my-content/pay-for-adverts-on-my-content as their only experiment - as if the solution can only be one or other, or both. Perhaps it's time for them to try a new experiment rather than repeat a failed one? Perhaps it's time to try not one, or other, or both... but neither.
How can publishers create value if they do not charge for content and do not take adverts?
Micro-contributions? Nah - that's just paying for content by novel means (as was Radiohead's pay what you like for our album) Sponsorship? Nah - that's just placing adverts on my content, by another name. Affiliate deals - just another digital ad innovation.
What can they do? Start with the Because Effect. Don't try to make money with content, try to make it because of it.
Content can be the social object around which communities of purpose form - co-creating communities ready and willing to wikifix solutions with brands and organisations - instead of having them imposed on them and fed to them through advertising.
Publishers can become platform organisations: platforms for creating outcomes with genuine ROI rather than platforms for pumping out things people may find useful attached to ads for things they rarely do.
Pay for content/Place ads on content, worked in a world of mass production and distribution - of mass media. But a new 'neither' model is required in a world of niche, of communities of purpose, of active rather than passive consumers - in a networked world.
Platform could be it.
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Nice one David - publishing that is multi-platform, as a service, as a workshop, as a learning community, as mentoring, as a film as well as a book, as an exhibition - all become part of the commercial and author offering.
ReplyDeleteThere is a great meme buried in here -- "Information is free. But the way it is packaged - the experience of it - you can add a price to." Expand this to "we never pay for content, we pay for packaging - the ease of getting to the content, the compatibility with a particular device, the experience of it..."
ReplyDeleteThis is an insight that would change the whole debate about newspapers if they listened - guys, no one is buying your news, they are buying your paper - because the paper was a more convenient experience of the news. Now that something else is more convenient, they are buying that new thing...
The question which is still unanswered is, what is the new packaging that can generate enough money to support the production of the content.
I find the content in newspapers very interesting and we 'band of brothers' in Legal 2.0 are following it with interest because there is a sense that the legal sector could go the same way.
ReplyDeletePersonally I am not so sure. I do accept that content drafting will ultimately be driven down to a 'free' cost due to technology but the intellectual value of legal is something that is less easy to migrate to the user. In other words certain information will be free, packaging will be important but advice will be the definer.
Sure many will be able to self serve but the higher the complexity the more likelihood for the need of a specialist (advice).
I think where the newspaper model is different is that the user, as you say, can be both creator and publisher, (and also marketeer).
Where there is some similarity is in the legal sector offering a multi engagement platform so maybe our barn door has not yet shut before the horses get restless.
I'm always disappointed by these sort of musings, as they are great on expounding the problem and then fizzle out completely when it comes to actual solutions that generate revenue - no matter what name you want to give it. So the wiki/platform idea is nice, but how do you monetise it?
ReplyDeleteI have my own idea for smaller sites, one of which I run. But the broader problem for publishers is not just a business model issue. If enough news outlets fold, society itself is in trouble.
Sorry to disappoint Michael. But also, I beg to differ. The platform approach is entirely ROI focused - in the way messaging responses (advertising) are not. It is about bringing together people who care about improving an outcome or creating a solution as an outcome to solve a problem those people share. Real actual outcomes - new products, services, co-create brands, co-created marketing if you like. Maybe some of the links explain a little more. And maybe the deck on innovation we presented at Madrid (try slideshare, OMEXPO).
ReplyDeleteMy business has a range of rapid iteration products to deliver on this too which we are in the process of sharing with clients and potential clients right now.
In response to this very debate we've (David & I) knocked up this Slidedeck addressing the need for Media Innovation with some very real ROI focused solutions.
ReplyDeletehttp://tinyurl.com/y8o6rfu