Le Figaro's paywall plans

French paper Le Figaro has unveiled its payment model to the world.

The good news is that it will keep its main news section free and instead raise revenues from its loyal customers whom it figures will pay for an online archive, the best of The New York Times translated into French and access to a digital version of the newspaper available from 3am each morning.

Good model? Well possibly but once again proving that news is essentially a commodity and its ancillary services that will pay for journalism.

One other interesting concept though is that paid up subscribers will be ablr to connect with others creating a social network that will sit behind a paywall.

The packages start at around 7 pounds a month risng to 15 for the superior business service.


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FT introduces new subscription service

The FT recognises the value of enhanced products for subscriptions as it offers a new premium rate for its readers today.

From today there will be an exclusive editor’s newsletter, a weekly FT Newsmine email service and full access to the electronic edition of the newspaper.

The Newsmine seems a particually good innovation.It extracts hidden nuggets from FT articles and provides a snapshot of global market-related data, trends and observations that may have been missed during the week.

According to Rob Grimshaw, MD of FT.com,

“Our FT.com premium subscribers are highly valued and we’re delighted to be able to roll out this exciting new package of benefits to them,
“Together with access to Lex, I am confident that we have an attractive range of services that will only increase the uptake of premium subscriptions and increase time spent by those readers enjoying FT content online.”

Last throws of the dice for Johnston Press

I think that paid content's Patrick Smith sums it op quite well

If readers will only pay for content that’s unique and unavailable elsewhere, perhaps local sites have a distinct advantage in their patch and, in theory, a clear path to monetisation.
—But what if a rival publisher in the same town keeps their content free? Unless there’s a huge gulf in quality between local rivals, readers will have a very easy choice. Our paid content research showed that 95 percent of people would rather go elsewhere than pay for news online.

He is talking about Johnston Press deciding to roll out a paid content model.

A leaked memo via Hold the front page says that

Managers have told staff that JP intends to roll-out the paid-for model across the company in line with what they are calling "industry moves in this area to find a sustainable business model going forward."

Whether this is a suitable business model or the last throws of the dice of a beleaguered media group,we wait to say.

Just 5% of readers will pay for online content

Yet more research on why consumers don't like paying for news.

New Media age reports that just 5% of consumers would be willing to pay for a monthly or yearly subscription to a newspaper or magazine to access online content.

The research carried out by Continental showed that of

500 regular newspaper and magazine readers in the UK, 35% would pay 2p per article, 22% would pay 5p per article, 13% would pay 10p and 7% would pay 20p.

adding that

A micropayment model was also disliked by the majority (63%) but compared with the small amount that would pay for a subscription, 21% said they would be willing to pay for individual articles and 11% would pay a larger one-off sum to get access to the whole publication.

Are you ready to sell news on the web?

How to sell news on the web.

That's what we would all like to know and Insider have come up with a checklist to see if you are ready

1.You cannot charge for such commoditized content as world, national, business, sports and entertainment news.

2. You might be able to charge for local coverage, if it is sufficiently intensive, comprehensive and exclusive to make to make it required reading for residents of the targeted community.

3 In the business-to-business realm, you probably can charge users for exclusive information that helps them make money, avoid losing money or, ideally, both at the same time.

4.You probably can charge consumers for two things: (a) exclusive entertainment content and (b) authoritative information that helps them hang on to more of their money.


Ht-Joanna Geary

Neilsen-internet customers not loyal enough to justify subscription

It appears that Australia is also not keen on charging for online content.

The Sydney Morning Herald reports that the marketing research company Nielsen says

publishers taking that route were bound to fail - with Australian consumers ''highly unlikely'' to pay up.

It adds that

Drawing on a panel of 7000 online users in Australia, Nielsen argued yesterday that in contrast to newspaper readers, consumers on the internet did not show enough loyalty to any particular news provider to subscribe to a provider's coverage. More than 70 per cent of visitors to Fairfax Media's websites also read those of its main rival, News Ltd, it said.

Ht-Martin Stabe

Little enthusiasm for online paywalls

More than a quarter of people have cut back spending on magazines and newspapers in the economic downturn in favour of free online content according to a recent study by You Gov for the accountancy firm KPMG.

Only 11% of consumers said they paid for any online media and of those who did not currently pay, only a further 11% said they may begin any sort of subscription in the next 12 months.

Despite the fact that news organisations are considering charging for content,the report found little enthusiasm for paying for online news and also found that as more content goes on the net for free

Consumers are also spending less on traditional media; 28 percent respondents say they have reduced their purchases of print newspapers and magazines in favour of viewing free online content since the beginning of the recession; amongst those who had cut-back only 3 percent felt they would ever return to their pre-recession spending levels on these types of media.

Online readers turn their backs on paywalls

An interesting report commissioned by Paid Content which reveals that there is little enthusiasm for charging for content amongst the general public.

The figures from Harris Interactive show that

1.If their favourite news site begins charging for access to content, three quarters of people would simply switch to an alternative free news source, people who read a free news site at least once a month told us.

2.Just five percent of those readers would choose to pay to continue reading the site.

3.Eight percent would continue reading the site’s free headlines only.

4.And 12 percent of respondents are not sure what they would do.

Get readers gradually used to paying for content

Barry Ritholtz ruminates on how to save journalism and newspapers over at the big picture.

I agree totally with what he says

The problem facing journalism and newspapers is not one of technology — it is one of behavior. People are used to free, they don’t think they need to pay for content. A solution that ignores this simple fact is destined to fail, regardless of technology, software or widgets.

His strategy?

1.All newspaper sites should require registration

2.that six month after bringing in registration sites should introduce micro-payments (pennies) for select content. This would consist of a few pennies an article.

3.that a year on all new article would require a micro payment

Ht-Adrian Monck

Months away from a paid model

According to the New York Times,

Journalism Online, says that within months it will have a system operating and in use by hundreds of Web sites.

Its founder Steve Brill has said that he had

nonbinding letters of intent from companies that own more than 1,000 news and information Web sites — large and small, domestic and foreign — but would not name any of them. Mr. Brill said he expected a beta version of a payment system to go into use in November or December, and be in use within months on hundreds of sites.

The model appears to be that journalism online will retain 20 per cent of the income from the publisher.

Its rational is that

Serious journalism has always required payments by consumers, a lesson now being remembered as it becomes clear that online advertising revenue alone will not sustain robust, independent news departments, whether for newspapers or online-only publishers. Everyone, from readers to reporters, is facing the consequences as news organizations of all kinds are forced to cut back.

We await with baited breath

Factor involved in the paywall decision

Paid Content have done a quick analysis of factors involved in newspapers putting up a paywall in the US and have come to some conclusions

The newspapers tend to be located in smaller, often rural markets; online-only subscriptions are typically priced at a substantial discount to the print edition (in general, about 75% of what the print product costs); where numbers are available, the number of online subscribers is still a tiny percentage of their print counterparts (less than 5%); and many of these papers say they began charging not so much to make money online, but rather to protect sales of their print editions.

That last point is the crucial one in the business model suggesting that it is making the print version a more scarce and differentiated product.

This from one of the papers

“It will allow greater value to our many loyal print-edition subscribers by not giving away the news to non-subscribers,”

Set for a micropayments platform

It looks like UK content owners could have a working national micropayment network by next summer.

According to this report by Paid Content,

A testbed network is already being planned out, after Digital Britain allocated the government’s Technology Strategy Board (TSB) £30 million in June.

It follows this week's announcement of a £6m fund for those with interesting ideas for applications and platforms.

More arguments on the Paid model

The arguments about paid or unpaid have not gone away.

Alan Mutter argues that there are two reasons why we are not paying for news:

1.Publishers can’t figure out how to charge for content without throttling their web traffic and the online advertising that comes along with it.

2.Individual publishers are afraid to move unilaterally to begin charging for content but also unable to coalesce as a group around a common philosophy and platform for doing so

That's one side of the coin but Paul Farhi reflects that

Since there’s no indication that online ad revenue will ever be robust enough to support newspapers, maybe they’d be better off charging steep fees for online content or keeping material off the Web entirely and putting their emphasis on—gasp—that retro old print product.

Martin Belam illustrates the economics of pay walls

The relationship between scarcity and Price is a standard economic principle and can be related to the charging for online news.

Martin Belam seeks to illustrate this principle to demonstrate why Rupert Murdoch's paywall won't work and provides this image where newspapers from the UK, US, Australia, Germany, Hong Kong and India are all covering the same story.



And concludes that

when we think about asking the market to pay for newspaper content online, I think we have to look honestly at that content, and ask, what have we got that is unique and desired by consumers?

News organizations need to be guided by economics, not emotion or nostalgia, as they seek a business model for the future.

With all the talk in the media returning to the subject of paid content,this post took by interest (via Joanne Geary).

The reason is that the laws of economics are ruthless and the sole arbiter of the marketplace. They don't bend to what you want or feel entitled to.

and continues

Price is determined by the UNIQUE value your product provides TO THE CONSUMER. Both parts of the equation matter: how useful/valuable is it to the consumer, and could the same value be obtained elsewhere for less?

Murdoch's last gamble

Everyone is getting rather uptight about Rupert Murdoch's comments that all his news sites will be charging for content within the next twelve months.

But what does this really tell us?

Personally for me there has been one organisation ie Murdoch's that has transcended all the other media organisations but yesterday's losses at NewsCorp mean that even he can no longer buck the trend that the old model has failed.

There is a great post from Polis' Charlie Beckett who asks Is Rupert Murdoch an asset stripper, gambler or genius?

three possible rationales I can see for what Mr Murdoch is doing:

1. ‘Asset-stripping’: get as much cash out of these businesses as you can without completely killing the customer base to pump up the balance sheet while other media organisations burn their capital and plunge further into debt.

2. ‘The gamble’: If a few titles go down that just proves their weakness. Whatever is left standing will dominate a depleted market as the rivals follow in the wake of News International. In the same way that putting the price up of the Sunday Times actually strengthened its market dominance. If you are a sector leader - such as The Sun - then you have the brand community to set the pace and help dictate consumer behaviour.

3. Genius: Murdoch understands that enough of the public want to preserve their source of news and will be prepared to pay. They realise that they have had a free ride. They identify with the product and recognise that like anything worth having, you have to pay. Just like Sky. While the Internet enthusiasts preach the value of Free, most people pay for a lot of things online (shopping, books etc) as well as for broadband itself. Murdoch has clever schemes to wrap the payments into other services that will make it feel aspirational and valuable to pay a small charge for premium products.

For me it is the last one

It's not too late if a pay curtain is introduced imminently.

The Editor of the Wire,David Simon believes that newspapers need to start charging for their online content.

In an interview for the Independent this morning,David,who has some controversial views on the newspaper industry,describes how at the birth of the internet

"We were in thrall of these Silicon Valley mavens and our own leaders had not been chosen from the newsroom. The people running our industry had contempt for the product, they saw the news and the production of news as a cost, and they saw the advertising as the purpose, anything that interposed between revenue from advertising and more revenue from advertising was an affront,"

It is he adds though,

not too late if a pay curtain is introduced imminently.

By erecting a pay wall and charging a small price for online subscription, newspapers will be introducing a new revenue stream. Each newspaper site could be a platform to taking content from other specialist news providers, with consumers buying bespoke packages similar to pay television models. It should have happened years ago,These idiots couldn't see it. Their dreams were all about department store display advertising and fat classified sections. They couldn't see what the internet was providing, which was a delivery system of pure profit."

Why you couldn't charge for Susan Boyle

Staying on the subject of paying for online content,Jon Bernstein writing at journalism.co.uk looks at the problem of micropayments at ITV.

Their recent experience of the multi viewed Susan Boyle which whisked its way around the globe on You Tube,prompted Michael Grade to say that

“We are working on it and watch this space, but we’re all going to crack it, either when the advertising market recovers or a combination of advertising and micropayments which is 50p a time or 25p a time to watch it.
We may move in time, in the medium term, to micropayments, the same way you pay for stuff on your mobile phone. I think we can make that work extremely well.”

However Bernstein argues that it simply won't work describing the Boyle experience as persihable goods that people won't pay for

Quality drama may have a shelf-life and an audience willing to pay for it, but a water cooler moment from reality TV? Not likely.

and that

Micropayments only work if you control distribution which of course using the Susan Boyle analogy,you wouldn't

Availablity and not price determine the online cost

The pay for or not pay for argument continues over at mashable with a good piece from Stan Schroeder in which he argues that when it comes to free, it’s not the price that’s crucial its the availablity.

According to Sam the logic is thus

after all, if you offer someone a free donut, he/she is going to take it because the price is zero, right? Well, not exactly. In the online world, there’s another equally important currency: availability. It can be defined by the number of steps it takes to do something or download some content. The bigger the number of steps, the bigger the cost of the product/service.

More importantly though he continues to argue that free will not last for ever

because it’s just a transitional phase in the history of the Internet. The current trend, where everything seems to lose value, and the price of all digital content seems to inevitably spiral towards zero, will reverse

Price is just one piece of the puzzle

but there is also ease of use, the quality of the user experience, availability, the time it takes to do something.

Chris Anderson's for free

Chris Anderson is at least practising what he preaches as his new book,the future of the radical price is avialble to download and read for free.

What's more you can also embed it on your own blog as I have done HERE

FREE (full book) by Chris Anderson