Mumbrella Question Time panel: Paid online content will succeed if the system is smooth
Despite a string of opinion polls suggesting the public doesn’t want to pay for online news content, the consensus from panellists at this morning’s Mumbrella Question Time was that the business model will work.
Their comments follow last week’s attack by ABC boss Mark Scott on News Ltd boss Rupert Murdoch’s plans to charge, and Monday’s rebuttal from News Digital Media CEO Richard Freudenstein.
But at this morning’s Mumbrella Question Time, the panellists argued that the move could succeed.
Nigel Marsh, CEO of Y&R Brands, said: ‘Someone’s got to have the courage to move first and do it. It’s entirely reasonable and viable.” He said the process needs to be a “painless interaction”, likening it to that E-Tolls where individual charges go un-noticed once the user is registered.
And Matt Eastwood, executive creative director of ad agency DDB, said many consumers are already paying for content. Citing the example of having watched a news bulletin on his mobile phone for 50c the night before, he said: “I’m paying for news to come to me in many different ways and it’s just a matter of re-orchestrating where the money comes from and where it goes to.”
Mark Holden, managing partner of media agency PHD, said there would be less resistance towards paying for online content if the payment model was streamlined. “When you go into a newsagent to buy a magazine or newspaper you’re not asked to sign up to a year’s subscription at $89, you can make a payment quickly. If we can get micro-payments as a way of accessing content online and you don’t have to sit and fill something in – you can literally just click – the barrier will come down,” he predicted.
The fourth panellist, Joe Talcott, was speaking in his role as chairman of the Australian Association of National Advertisers. He is also group marketing director of News Ltd. He told the audience: “I’ve got a feeling I’m going to be working on marketing it pretty soon.”
Real world demand rather than opinion polls will decide the success of the business model, he argued. He said:
“There’s not going to be a vote on it, there’s not going to be a government saying you’re going to pay for online content, it will be put forth in the commercial marketplace and people are going to be able to decide to click ‘Yes, I want it’ or click ‘No, I don’t want it’. That is probably the harshest place to test something but its the most real place to test something. So if you can demonstrate value and the audience wants it, they’ll pay for it, just like any other products, and if they don’t want it then we have to go back to the drawing table.”
He suggested that opposition from media competitors “confused” him. He said: “What struck me is that if you’re in business and you see a competitor doing something really stupid, typically you don’t put up your hand and say ‘don’t do that’ you would typically say ‘yeah, go for it mate’.”
It was a good session Tim, well done!
The panel were very knowledgable and good speakers, their clients are in safe hands for sure 🙂
I would have loved you to of had a critic on the panel for the paid content questions to create a stir and a little debate. There was a lot of agreement regarding the matter, when I know so many people who oppose it and feel that online paid content won’t necessarily work…
A favourite advert of late is the Pure Blonde TVC where the dove hits the billboard and lands on the ground. It tickles me everytime… Can you do a favourite advert poll on this site?
Keep up the great work and I look forward to the next one.
regards
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Tim
The panel were being a bit polite – they all have close [professional above board] relationships with the paid media. So let me say it again. NO-ONE WILL EVER PAY FOR THEIR DAILY NEWS ONLINE. End of story. [And if you’re in the ‘they will pay’ camp why not introduce a fee for mumbrella.com?]
Sincerely
Free Press
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Tim, I think time will tell, however limited resources being money will dictate the success or failure of said models, I will not pay on the web and I feel the the abundance of free content will work against this model.
Mobiles are a different kettle of fish and that is getting updates where and when you want them and not choice, very walled garden already.
Pay TV is about choice, news papers are about advertising.
the genie is out of the bottle, and news content just is not worth that much anymore.
anyway I can’t wait to see who tries first, really hope its Murdoch, maybe he should also charge for Myspace spare us all it’s slow death.
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Micro payments – I think that might be the answer.
If the papers are motivated enough (like the porn companies were to introduce credit card transctions, and video over the internet) to introduce a micro payment service on the internet, then I would ‘pay by the story’.
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I found it interesting that a panel of advertising professionals had such a positive take on pay walls around news content – until I remembered coming across this new book (actually it’s only out next month): The Chaos Scenario by Bob Garfield (http://thechaosscenario.net/blog/).
The writer – an adman himself – believes that the yin and yang of mass marketing and mass media have decoupled – and this has consequences as potentially devastating for the marketing industry as for the media industry.
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If you pay 50 cents for a news bulletin sourced from a wire service or a content pool, but also freely available online, your an idiot. The hand-wringing that’s going on about charging for generic, pooled, unrefined, ubiquitous content is disgusting, or to put it less eloquently (and to quote KP), is an “intellectual wank”.
Further, the idea that “someone has to have the courage” creates a bit of chuckling over at Fairfax. By all means, News, go right ahead and build that 7-foot wall, with barbed wire, and guard dogs. Go right ahead News and stand by the mantra that content investment must be underwritten by a combination of ad and subscription dollars. Fairfax is salivating at the idea of seeing their monthly UAs jump 300% when News flicks the “PAY” switch. Christ, where’s the objectivity and honesty in all these so-called ‘leadership’ panel discussions.
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How do you make Australia’s leading financial newspaper disappear online
Answer – put it behind a paywall.
That not a person has mentioned the story of Fairfax’s afr.com paywall experiment in this discussion indicates how successful the vanishing act has been.
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I will throw in good ole ‘seo’ into the equation.
Google indexes content. I know that say news.com.au and smh.com.au etc are mainly destination sites, however tehse sites will still attract thousands upon thousands of visitors from search engines (please correct me if I am wrong here?)
– What happens when I am researching or googling some names or events and I click through to news.com.au and it says “please enter your user id and password”? I know what I will do: I will click ‘back’ and find the content I am after on a free site… SEO will dip to these portals because if you click back Google will think that the site is not relevant to that search result…
A smaller part of the pie, however another point against the paid content side perhaps..?
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I don’t even read articles on website where registration is free. If they close off the age I might pay for it. I wouldn’t bother with the herald-sun. At the end of the day there is always the ABC.
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Daily commodity news will never gain paid for readers….
exclusive premium content will – people will pay for stories that you just cant get anywhere else – so then it become a race for the exclsuive storys to deive the paid readers
bring it on – cant wait too see the outcome
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Thanks for the ad poll suggestion. Icharge 2.0. I’ll give that one some thought. It may be fun to do.
Free Press – The views we report above are those of the panel, rather than mine.
But to answer your question, my personal view in Mumbrella’s case is that our model is about building a large specialist audience and then paying the bills by helping relevant advertisers reach it. For the core product, that relies on making it freely available. But people may be willing to pay for certain services around it. For instance, this morning more than 100 people paid $95 each to sit in a room and heard four interesting people talk about the industry.
Terry T, It’s about convenience, I’d argue. Sure, I could go online and find that news bulletin for free somewhere. But if I can look at it now, on my mobile, on the bus on the way home, then that might be worth 50c.
Also, aren’t you making a bit of an assumption that the ‘7-foot pay wall’ will be around everything? I’m not sure I’ve heard News Ltd arguing that, and certainly not recently.
Cheers,
Tim – Mumbrella
I liked the reference to E-Tolls.
The thing is whenever the Govt announces a new toll road the first thing the media always ask is how much is it going to cost?
This is the big question that seems to have gone unanswered in this ongoing debate. No doubt it will be as confusing as pay TV.
It will be interesting to see what happens when the Sunday Times starts charging for its online news next month…
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Mr Mumbrella, I appreciate the response. Yes, the convenience question is valid, but the price reflects more on the delivery technology (ie data charges) than the value of the news itself. As to the walled garden comment, a little bit of sarcasm mixed with a dash of hyperbole never a dull moment makes 😉 Nevertheless, a publisher like News can’t make the model work simply based on very niche components of their service (or new information services).
Even in the context of a subscription/paid model, volume or reach has a role to play, and for larger publishers like News, that role is more substantial than for a more specialist publisher like Mumbrella. Exhibit A: football coverage on BSkyB
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is it wrong to assume people will only pay for something they can’t get elsewhere in a way that is easier.
on top of this they need to place a value on the content/product
with that in mind, what can the local news providers really charge for?
my thoughts with newpapers is the cover charge you pay isn’t for the content – it’s for the time spent to curate/piece together the most valid or entertaining news/content/pictures. same with pay tv.
with online, right now, there doesn’t seem to be much curation … there’s just a sh*tload of stories/AAP feeds etc. Surely there must be a value in creating a product/publication which filters out all the irrelevant and says ‘this is what matters’
Thanks Tim [10:17]
I wasn’t suggesting you were pro charging, I was just interested in your position on the matter.
Your answer is EXACTLY why no-one will ever pay for newspapers online.
Many thanks
Keep the debates going
Free Press
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Dear Ben Shepherd
What matters to me mightn’t matter to you.
Sincerely
Free Press
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