Wednesday, November 19, 2008

Funding the media-the cross subsidization model

The network’s genome carries the “free” nucleotide. As in both freedom and free goods and services. Like it or not, its publicly funded origins (universities and the Pentagon) led to the emergence of widely adopted services such as search engines or Wikipedia. In turn, these have sealed the fate of the paid-for model as the dominant one. Right. I intentionally emphasize dominant. Because like everywhere else, hybrid forms are likely to emerge


That is Frédéric Filloux talking about how to acertain extent the media has shot itself in the foot by making the internet to all intent and purposes free

Consequently the fully paid up model no longer works online unless you are selling specific and specialised information.

However in Filloux's mind there may be exceptions in the form of a cross fertilisation between the paid for and the free

The online magazine Slate came up with an interesting idea: charging people. In fact, a small fraction of them. Introducing another flavor of the hybrid model: a tiny proportion of users paying a fee that will subsidize the vast majority of non-paid ones
and then there is China where

the software industry has been working that way for long: 80% is bootlegged versus 20% generating license fees, but the market is so huge that even a tiny monetized slice is sufficient to insure a sizable revenue stream for software makers

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