Thursday, December 29, 2005

 

charging for online content

Teleporting Tattler has a great post about the gold mine of online content. More specifically it talks about the money that can be generated by charging for online content. As near as I can tell there are several basic tactics used by websites to charge for content without completely undermining the flow of fresh visitors from search, blogs, and word of mouth. The hope is to be able to generate a reliable stream of revenue without forcing everyone to pay up or sign up. I've broken these up into different models using a theme site as an example.

The Red Vs Blue "Sponsorship" model
Charge for early access to premium content. Public access is granted a week or so later for all users.

The Total Fark "Club" model
Charge for access to an elite and completely closed community where all users can post headlines and comment on discussions. Total Fark users also get a an identifying icon next to their names and are able to post to Fark discussions before they are available to the general public.

The South Beach Diet model
According to the Tattler article, over 350,000 users have signed up for the South Beach Diet's website. This gives dieters access to meal planning tools, a recipe database, and private discussions areas all centered around the famed weight loss program. The real neat part about it all is that the website fully capitalizes on the brand recognition to try and convert visitors into South Beach Diet Online users. They aren't pushing the books so much as the online experience.

The New York Times "Select" model
Select users get access to all the content of normal visitors with the addition of early access to select content as well as access to additional op-ed articles, news alerts, and access to International Herald Tribune articles. In addition, Select subscribers all get access (limited to 100 article a month) to the New York times archive going back to 1981.

The eBay model
All content is publicly available, but if you want to list content you have to share part of the closing auction price with eBay. In addition you have to pay a small listing fee and can purchase additional premium features to help get your item more exposure. The model is entirely seller oriented with buyers largely unaware of the costs associated with a transaction.

The Meet Me at Hot or Not model
All users can quickly post photos, comments, and keywords. All users can also browse listings and click on the listings that they are most interested in. If Dave says he'd like to meet Jennifer, his photo them is weighted to come up in Jennifer's queue. If she says she'd like to meet Dave them a match is made. The premium feature comes into play when users want to talk to each other. Only paying members can send and receive messages. You can search the profiles looking for a paying member to chat with or you can subscribe and be able to chat with all members.

There are probably other models out there (iTunes anyone?) but these are the handful that have stuck out to me. I believe charging for content is a very tricky issue even if the content is of high value, but it can be done. A growing number of websites, and even some blogs, are experimenting with ways to earn more money from their content and yet still have an appeal for the extremely fickle Internet public. It will be interesting to see how this plays out, but one thing is certain: the more websites try and shut their doors to non-paying users the more competitors will pop up trying to find a viable model to give their content away for free.

Feedback: What do you think? What are your experiences both as a “webmaster” or as a Internet subscriber? I’m very curious what models work the best and under which circumstances.

Online Content Business Models
Please Newspapers, charge for online content!
The Long Tail Will Rise If The Media Charge For Online Content
Education Week General Manager: How We Came to Charge for Premium Content
Some online content is worth paying for
CNN To Cease Charging For Online Video
TV, newspapers see big changes


Comments:
I don't think paid models for content are going to work very well in the future. The moment you put up a barrier between your users and your content - no matter how small - you're just encouraging them to go elsewhere.

Information is no longer scarce, so someone can easily set up a free, ad-supported service and steal your audience from you. Just look at what has happened to the newspaper industry - all the newspapers that charge for content are virtually invisible on the web. Even if they're still being indexed by Google, bloggers are reluctant (or unable) to link to the articles.

Bottom line: You need to make your content free and monetize it in other ways.
 
My 18 year old son signed up for an "insiders" blog on the National Hockey League back in September. All that was promised has not been delivered.
The blogger promised online chats with NHL players and such. Promised daily updates by email and yet the guy can't even get his rss feeds to work.
I tried to get his money back but no response. guess you have to be very careful whee you spend your money on the web.
Wish there was some type of organization that would watch these type of things.
This blogger goes by the psuedo name of Eklund, do a search if you want to see what I am talking about.
 
Very good points! If I may add one more, explained in detail in my blog: 10 step recipe for monetizing on content – the Engineering Weekly case

Engineering Weekly offers payed access to old content while early content is free.

Advantage: builds a large group of "free" readers, who eventually can be turned into paying readers. Untill that point they generate traffic and ad revenues.

As a special trick Engineering Weekly optimised themselves to Google, making premium content searchable in full length – but only gives a way first 200 characters for free when users eventually click their links.
 
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