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Micropayments: Pay Walls’ Happy Medium?

cents.jpgWhen entertainment industry trade Variety decided to put its online content behind a pay wall earlier this month, it promised options for how users would go about paying. (Random selection being one of the more out there ideas we’ve heard for pay walls, but hey, everyone is trying something new.)

Other Web sites like those belonging to The Financial Times have embarked on a plan that would eventually allow users to purchase individual articles for a small fee, much like buying a song from iTunes for 99 cents instead of the whole album for $10.

Media analysts don’t necessarily agree that bringing down the price of content (even if it costs customers more money in the long run) will make potential readers take out their wallets. Jay Rosen New York University journalism professor, Bryan Keefer of The Daily Beast and Josh Benton of Harvard’s Nieman Journalism Lab both see the chink in pay walls’ armor as being that the majority of people just won’t pay for content in its current state, period. (Rosen actually predicted the paradoxical idea of paid-for “exclusivity” appealing to link-obsessed readers in a 2005 article for The Huffington Post.) So the people already paying for subscriptions will continue to pay, and the rest won’t be typing in their credit card information, no matter how small the fee is.


We’ve seen this issue arise when talking about any new media content, from e-readers digital stores to iPhone applications to online entertainment channels like Hulu and NBC.Com. Unfortunately, the relative success of iTunes in getting users to pay for music versus a news organization getting readers to pay for content might be intrinsically about the nature of what they’re selling.

“News is not like an iTunes song; it’s perishable” Marshall W. Van Alstyne has been quoted as saying. In a New York Times article yesterday, Richard Perez-Pena and Tim Arango speculated:

“Entertainment will be easier to charge for than news. It may be hard to prevent free distribution of an episode of ‘The Office’ or ‘NCIS,’ but the product is unique, with no substitute being created by someone else…But for most general-interest news, any paid site would be competing with alternative versions of the same articles, delivered by multiple free news sources.”

So it doesn’t matter how little you charge, unless you have a one-of-a-kind columnist or a consistently unique quality to your content, readers can always go elsewhere to read the days headlines, while something like a song or TV episode can’t be reproduced by a competitor for free.

But all is not lost! In September, when The Pittsburgh Post Gazette launched its hyper-local news site PG+, 53 percent of Fishbowl’s readers said they would pay for a site that offered exclusive content instead of the same fare they could find in the print edition of the paper. So to publishers we say: go ahead and develop a business plan with micro or macro payments…as long as you focus as much on making your content superior and unique as you do fretting about how much to charge your customers.

Read More: Adding Fees and Fences on Media SitesNew York Times

Charging for Columnists: Notes and Comment on the Launch of TimesSelect –Huffington Post

On Micropayments: “News is not like an iTunes song; it’s perishable.” –Harper Studio

Previously: Mashable: The State of the NYC Blogosphere is Crowded, Variety.com To Begin Charging For Content

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