There’s an article today at abc.com that looks at recent trends around net-based pay-for services and the smattering of paywalls from News Corp to the NYT that are up or threatening to be put up, and speculating that this could be the beginning of a trend. Of course, a YouTube video rental site and a few large publishers putting up paywalls will make zero difference to the “free internet” on their own. But if they’re successful, it could spark emulation. But could this be a trend that could snowball enough to change the nature of the net?I doubt it. As an online publisher myself, I’ve seen what’s happened to advertising rates, so I know why there’s all the heartburn out there. But by prediction is this: having individual internet users pay for content is destined to be a niche strategy.
It’s worth talking about, though, and to some extent, it’s worth worrying about. If the only economic mechanism for getting stuff on the internet is direct pay-for-use, the the internet as we know it is dead. The biggest problem is that the overhead costs of tracking who is entitled to what would put a huge anchor around the neck of anyone who wanted to launch a new service or content site. The truth is, most internet users could probably afford to spend $10 or maybe a little more per month to pay for what they read and use online. Some people could afford hundreds, but for every one of them, there are ten internet users who can afford next to nothing. And it wouldn’t be worth it for most pay-based systems to charge much less than a few dollars. So that means that most people would only be able to afford to subscribe to a few services. That would make the internet worse than AOL.
Speaking of AOL, probably the most workable pay-for scenario looks a lot like AOL, with people paying a flat fee for access to a whole vertically integrated content network, run by one entity or a federation of affiliated publishers, who shared the revenue. But the AOL walled garden compared very unfavorably to the free internet back in the 90s, and it would look even worse today.
As the abc article mentions, one of the big fallacies with the pay-for internet idea is that very few content consumers have ever paid the full price for their news and entertainment anyway. Newspapers and magazines are supplemented by advertising, TV and radio too. Even the cinema and sporting events are subsidized by tax breaks and overpriced concessions. Only book buyers pay for the full cost to produce and distribute their goods, and even that model is undermined by libraries. And in most of these cases, the producers of the content receive a small fraction of the revenue: the lion’s share goes to the apparatus that funds, manages, markets, promotes, and distributes the content. The reason that the free internet worked in the first place is that it slashed the distribution costs so dramatically, and eliminated the need for so many middlemen, that it made the economics work to distribute for free and pay the content creators on advertising alone.
Just because we’re in an advertising slump doesn’t mean that those fundamental realities are broken. Sure, there are some kinds of information that are just too fringe or niche to be able to make enough money for their creators to justify doing the work for purely economic reasons. If you have tens of millions of viewers to your web site, it’s always going to be easier to make ends meet than if you have thousands. For publishers reaching small audiences (and this includes OSNews) the primary reason for participating is always going to be non-economic. We do it because we like to be part of a community, and let’s face it, the biggest contributors of user-generated content do it because they like being prominent in their chosen communities. We do it for our egos, or because it advances our careers in some way, or because it just plain gives us pleasure and satisfaction.
And remembering the flipside of the “information wants to be free” cliche, some information wants to be very expensive. And even if it’s only useful to a small number of people, they will be willing to pay — a lot. So there will always be a place for paid services and paid content online. You know what’s also valuable? Our time. The more valuable your time is, the more you’ll be willing to spend for online services that save you time or hassle.
There are no shortage of people who will continue to create things online for us to use for free. They can make it work because as long as we have net neutrality and the gatekeepers don’t create artificial tolls on distribution, it will always be cheap, and ever cheaper, to distribute your bits online. Some of the existing media firms are too inefficient to make money online even with huge traffic, and they will eventually become efficient or become dead. And every day people will come up with ideas for services or content that just aren’t good enough to survive. And they’ll get dead too. And some ideas that would have worked when the economy was good won’t survive an advertising slump. And maybe advertising will stay slumped. And that will make it hard for publishers. But we already have a supply that exceeds the demand. If I lose out on two favorite sites because they don’t survive the economy, I’ll surely find another three later on. And if any of the now-free things I rely on goes paid-for, then I’ll decide to either pay up or let it go. Chances are I’ll let it go, because I only have so much money, and if I had to pay $3, or even $1, or even $.01 for every web site I go to in a month it would be more than my house payment.
I read something a couple of weeks ago that was discussing ways that the government can stimulate the economy. Small-government advocates rightly point out that it is difficult-to-impossible to identify the right places to put any funds, and it just becomes a politically-biased handout to a few lucky individuals. But they advocated that governments could spend money and political capital promoting a robust and free (as in liberty) internet network in their countries, and that would pay a huge dividend. Even if the government wanted to prop up the media, to ensure a vibrant “fourth estate,” the best way to do that would be to make sure that the internet infrastructure that the future media will use to distribute its bits is as inexpensive and flexible as possible. If the government propped up the media by subsidizing the internet (and more importantly, by creating a legal framework that protects the network from artificial restrictions from business or government gatekeepers) then the unintended consequences would be a blossoming of internet-based economic growth like we saw 15 years ago.
Sadly, if the world’s governments is doing anything, they’re doing the opposite. Demonstrating an unwillingness to reign in existing access gatekeepers while layering on laws that restrict freedom, usually in the name of protecting the citizens from pictures of boobs, protecting media companies from file sharing, or protecting themselves by limiting citizens’ exposure to ideas that are inconvenient to the government.
So the internet is vulnerable to a loss of freedom in both senses of the word, and internet users have demonstrated that they’ll go along, up to a point. But once you take it too far, you’ll find that the people won’t go along. Where will that point be?
The biggest problem to a pay-for internet content, is real micro-payment. right now, micro-payment (from a few cents to a couple of dollars/euros) is discouraged by payment middlemen… I can see several people payment small amounts to some good article, but I find hard to see people paying $10 a month to a website they read… maybe because they can read from, maybe, 5 to 100 different websites daily, and paying for several of them would quite a sum…
…another problem is concurrency. For me, $10 dollars is not money I would spend without thinking too much… but I see north americans arguing the opposite, that it’s basically worth nothing… You can see where those $10 DLC for games are more popular…
But ads… well, ads are a concurrency of their own. It is much easier to sell ads to anyone, anywhere, with floating value, than deal of concurrencies that will limit our user base.
…and in the end… everyone knows that the biggest heads pushing for-pay content are the big “monopolies” of content (usually distributors/middlemen, the ones that are closer to been just legacy with the internet content distribution), the ones that basically try to control the system,
Paying for content? Paying for someone else’s hard work? Unthinkable! I want content for nothing and entertainment for free.
I’m pretty sure the “free internet” is not about not having to pay for content but is about freedom of, among other things, expression.
I’d say it freedom from censorship. Internet in post-USSR space becoming the only remaining source of truth
Edited 2010-07-12 08:24 UTC
It worth paying for good content but not for pure crap.
What expert exchange and the copy cat sites are doing is just digusting. They basically steal content from google groups and forums and offer it for subscribers plus push their google rating up with -possibly- blackhat seo techniques.
But offering free services which makes revenue from something else is also hurt others business. Just think of the free email what google/hotmail/yahoo dominates.
You would fail many times over if you would try to start your own webmail service by asking 5-10$ from your customers and there is still a good chance that no one would bother using your site if it would be free.
The web might remain free. However, the app- or cloud-based internet follows different rules and is growing. Users are used to buying apps and apps are easier to handle. Content providers like the app model because they are easier to control, make a better advertising platform, and harder to pirate the content. Clearly newspaper publishers see it as the way to get their groove back.
That is the trend to look out for. The cloud already has a foothold on the PC. It is too compelling for users and providers alike. If it takes over, the app internet could become the “legitimate internet” leaving the web to become a seedy red-light district.
Besides, the natural progression is that things that are free eventually become things that must be bought.
Edited 2010-07-11 20:54 UTC
You mean it isn’t that now?
News companies have been screwing themselves out of customers for decades, now. The internet just made it easier for those people who didn’t have other ways to get news without paying them for pieces of paper with copied content. Pay walls won’t work because they aren’t offering anything worth paying for. It’s really less about any of the other issues that try to get tangled in with it, than it is that paying extra for the same copied content being sent out everywhere, with no depth in the research/reporting, is not worth it.
However, being primarily bean-counters, the head honchos are blind to that. Offer value, make ads 1st-party only, and then let’s see what happens.
The thing is once internet content becomes nothing but binaries there will be nothing legitimate for Google to scrape and the equation will change. Unless you are satisfied with “citizen journalists.” Personally, they disgust me.
This new era of computing is a complete reaction to the previous 4 decades. Tech and content producers for all stripes feel like they left a lot of money on the table. They are determined to correct the mistake.
I agree. It’ll never happen, though.
Screw NewsCorp and other mainstream crap. I don’t even read their ‘news for dummies’. I also don’t care for the ‘multimedia content’. This is just hilarious how one man can never have enough of these green paper things.
Actually, people pay for the internet connection, and if they want to view something on the internet they need to pay additional cost for those contents then people would not understand and won’t use internet as much as nowadays. They are going to screw themselves. They need to search for other ways of getting cash. There were already many cases that most of users of websites moved over to another similar websites which offered free service.
Or else they’ll start pirating content, just like they pirate movies, music, and apps now. Then you’ll see the publishing/news industries trying to control copy/paste in order to combat ‘content piracy’.
The real question is, do we still need the news media? I mean, if there’s a huge earthquake in California (or whatever), it’s going to be all over the internet in a very short time.
I think you got a good point. And i think that in this way; Are the contents on the news media thought by people worthy to pay for view? I don’t really know. Maybe not as much as the content providers think. :p
But In regard to your example, I don’t think internet gossip would contain trustworthy information on how strong it was, how much damage was occurred and etc compared to that of news media. Yes in my humble opinion, we DO still need news media. Some people would still prefer it over internet gossips. Some people would want to know more in-depth information on the happenings. We need both!
Edited 2010-07-12 02:20 UTC
The question is pointless when one can get the content for free. It’s a more relevant if one can’t get their content any other way. If you asked me right now, I would say I wouldn’t pay for content. But that’s because I can get it elsewhere for free. But if the only way to get content was to pay for it, I might find out that i am willing to pay more than I think.
That is only if the content is worthy enough to pay for viewing.
It will be all over the internet, because actual news organizations are there on the scene reporting it. Sorry but you have this the other way around. It is the media leeches, the bloggers and such that could simply disappear without notice.
Not true, first on the scene will be the disaster tourist that live near it, texting, mailing and twittering away.
For example there was a forest fire near me in the Netherlands, I could see a huge smoke cloud out of my window (a actually started that last woird capital w..:S )
I looked at all the dutch news websites but there was nothing there, I looked at twitter and there everybody knew where the fire was, people went there and took pictures. A long time later there started coming articles in on the news sites, but it only contained information they garthered from Twitter and all the pictures where submitted by there audiences.
The old rules have changed, now journalist get ther einformation from the people instead of the other way around.
That’s why today’s “journalist” are spending most of there time Twittering. Lois & Clark are dying or death.
Edited 2010-07-12 12:18 UTC
Ok, so please tell me how many bloggers were embedded with the U.S. 3rd ID on the march to Baghdad (I seem to remember CNN was there), and how many sat on their asses in their bath robes watching it all on CNN? How many bloggers were in the Green Zone during the rise of the insurgency? How many left the safety of the Green Zone to really cover the story (Look up Michael Ware please)? Has a single blogger ever faced death or serious injury reporting? No, tripping over the cat on the way to the fridge does not count.
The idea that you can equate what some fat losers write on the safety of their computers tucked away in the basement with people who are actually professionals is an insult, especially all those that have lost their lives bringing you this information. The same info that fatboy re-posts on his blog.
But never mind, I guess I should just ignore the professionals, those that have been educated and spent time building up sources in favor of some anonymous shmuck who will give me lots of opinionated bullshit over any substance. So what your telling me now is that we should simply accept that some high school drop out who spends his days idling away on Twitter is what you want to rely on for information? And what in-depth analysis do you expect out of this?
You can have your Twitter, Facebook, and all that iReporting crap. I will take my NY Times over that in a heartbeat, and know full well at the end of the day I will be the wiser one for it. So good luck, we truly are living in a god damn decadent generation that wishes to just fucking embrace ignorance.
I’ll take the fat losers because I know they will at least give me a variety of news and opinion that I can’t get from the mainstream media. I’d rather not get my news from a bunch of New Yorkers that readily admit to their own bias:
http://www.studentnewsdaily.com/biased-item/ny-times-nicholas-krist…
The only place where normal civilians can’t cover something are places where they may not come because they’re not press or places where there communication are hampered i.e. places with censorship and all that. But those situations are artificial.
Also the journalist who do go to such places are few, very few (and decreasing). The rest just go to there desk, copy there biased story, change some words (on a good day that is). Maybe if they’re trained in actually covering something them self, they might go to some trade show and make some unintended commercial.
…why am I so grumpy? Well I wanted to become a journalist, but became very disappointed with there lazy buzz-word and Internet-hype obsessed culture. I really think the state of journalism is very poor at the moment. (And haven’t got any sleep last night
EDIT: I have to admit that I think it to be worse in the Netherlands here journalist respect things as ‘No questions please’. Real investigation is nothing more than asking the, by definition extremal biased, spokesman.
EDITEDIT: I have the spelling of an ox.
Edited 2010-07-13 06:23 UTC
No you are wrong. People could always interpret situations within the boundary of their own knowledge, and people are also very subjective mostly on the things they do not know or do not understand fully. Therefore, I prefer news media for information regarding such happenings much more than tweets or blogs of non technical people.
Sp by this logic, since you’re already paying for the gas and the car insurance for your car you would expect the grocery store to you give you what you want for free?
Sorry but by your logic, the grocery store should use my car to sell the items. Otherwise it does not make sense.. and even so no way!
And you don’t understand point. About how people would think. If that was once free for all, people would expect it free all the time. Are you an employer of a content provider company?
The companies that’ll succeed at this are the ones who provide actual value for the price they’re asking. Prime example being publications like The Wall Street Journal for whom timely digital content can be a real selling point. More generalist news media won’t be able to pull it off unless they’ve got some angle that puts them above the hordes of perfectly serviceable free alternatives
The media conglomerate that controls the media has grown too fat. Used to be that they subsisted on ad revenue. Now thats not enough. They want us to pay on top of the ads. Problem for them is that for every new agency, there are tons of do it yourself bloggers/writers looking to make a name for them selves or their site by writing for free. In the end, the small efficient news groups will survive. The bloated masses will die. Its the natural way of things.
It will make user generated content more visible and the long term, better (because ad revenue will push content provider to produce better quality and more interesting stories, the market rules will apply to “amateurs” content).
Because like most of your naive dirty hippy ideals, it fails to take into account “who’s going to pay for it”
Electricity costs money, labor costs money, hardware costs money and guess what — SOMEBODY has to foot the bill.
The very notion of a ‘free internet’ is so ridiculously naive; It’s NEVER been ‘free’ as in beer… SOMEONE had to pay for it; and if you’re talking about companies charging money to use it you’re NOT talking about ‘free as in freedom’.
MOST of the cash for the original infrastructure came from American taxes and donations to private schools (so excuse me if I don’t exactly shed a tear over the US holding onto ICANN) and has been built up by people paying just to connect; the real services paid through advertising of commercial products or other material goods worth paying for… as well as good old fashioned hat in hand donations.
Right now you’re probably paying an ISP just to log on; It’s not free. Big services with large hosting usually have to operate hat in hand if they are ‘free’ (wikipedia much) akin to PBS; someone still has to pay for it somewhere!
So god forbid you have organizational structures to make sure the service can afford to stay afloat…
Christmas on a cracker this fringe whacko corporations are evil nonsense is wearing just a little thin. It’s like do us all a favor and go back to eating your Tofu around the drum circle to sing “Kumbaya”
(I was originally going to say “Lesbian Seagull”, but I know some people wouldn’t get the joke and assume it was a sexual slur when it’s not! Christ I hate being niggardly in my speech just because other people are dipshits)
Next thing you know they’ll come up with this brilliant health care plan that involves forcing people who can’t afford insurance to buy it from the state. <carlos>Look around, the stupid people didn’t get it…</carlos>
“Who’s going to pay for it?” — in the long run with this naive pipedream bull, everybody!
Edited 2010-07-11 23:37 UTC
Real freedom, is when someone is willing to do it for far less and undermines your position.
I agree with much of what you say. I don’t pirate music and movies. I pay for sites I find valuable. I even go along with tiered Internet bandwidth, as long as any traffic I generate across it generally gets treated “equally”.
But where I have to draw the line is where certain entities want to artificially alter the Internet landscape to further their own ends. Take the music/movie companies, for instance. Have they offered a real, attractive alternative to piracy? Not that I can tell. They (or their “resellers”, like Apple) want about as much for music purchased online as on CD, when the distribution costs can’t possibly be what they are for “traditional” CD sales. It’s also hard to get lossless music online, or at least a wide selection of it.
Instead of offering something of value, the content providers want to use ISPs and governments as their own private police forces. God forbid they get creative and come up with a new, better business model.
I’ve pretty much resorted to used-CD shopping, both online and in local stores; that’s the best value IMHO. [For movies, I use Redbox; I’m not in a big hurry to see most movies nowadays anyway.]
ISPs becoming content providers present another problem. Some have demonstrated that they will favor their own content on their networks. Because of infrastructure costs reducing the number of players, switching providers is often not an option.
I am OK with paying for something of value. I’m not so good with getting screwed, or having my choice limited.
I wanted to applaud this excellent example.
Like millions of geeks and other music addicts, I’ve burned CDs with CD-TEXT. I’ve had DVD players, CD players in my cars, portable CD-players, etc. Guess how many supported CD-TEXT? Not more than 1 out of 4 or 5.
I can do it. Anyone can do it. Some manufacturers support what (as far as I know) is a standard and probably costs less than 0.5€ to add in a CD-player (I’m specifically targeting car units here). Guess how many CDs I’ve had that had some CD-TEXT? None. Not a single one. And God knows I’m a music addict and how much money I’ve spent in new CDs.
Why didn’t the music industry bother to offer it? What cost would this 1Kbyte of data incur on top of the typical CD cost? In my opinion, it wouldn’t make a difference.
New editions of albums don’t contain additional content like trivia, videos (exception Lene Marlin’s Playing My Game -my favorite voice ever and the album I’ve cherished the longer).
Mixed and enhanced cds have been “underused” to a point that’s almost criminal. And yet they sue for piracy?
I play guitar, I’ve played keyboard and I’ve spent years trying to sing. I’ve always wondered why I’ve never come across any score or tablature, even fragments, in any CD. I understand the “buy the songbook” motto, but given the price of the CDs, the price of concert tickets, I don’t see why I should pay 25€ for Josh Groban’s Awake album songbook when the prominent songs (Awake, Verita, Un giorno per noi) are all either absent from the songbook or transposed in a key different from the version on the disc. God! The album title song is not even in the songbook! and not even on the standard edition of the cd!
I’ve bought a few albums online on Amazon… Not a very different experience: you don’t get a booklet (exception was Melody Gardot’s “my one and only thrill”), some albums don’t even have a folder picture…
I’m so fed up of being milked I stopped buying CDs. It’s about time these stupid behaviors from the music industry stopped. But that won’t happen because the industry may be dying but they’re still mighty. Looking forward to starting my notation editor project to level the game.
You’re so shortsighted and bought into you the corporatist view of things you don’t even know you have blinkers on.
Who pays for mothers to have children?
Who paid for your mother to raise you ? (saint she must have been to raise such a US-centered myope).
Who pays for all the unpaid labor that mothers put in each day?
If it is not paid then why do parents raise costly children with no financial reward?
Why would people build a multitude of operating systems of industrial quality (there is more than one after all) and give it away for free?
Your primitive, narrow, and quite frankly obsolescent view of economics is Industrial Age thinking and doesn’t account for such things.
People working for the exchange of currency is recent and the exception to the rule in global labor – even today. Most labor performed in the world is unpaid and voluntary and not accounted for by traditional economics. Imagine what would happen to the world economy if mothers charged for their services? What would happen to the world if a cartel of wives charged for conjugal services? Most men would just dump the wife they had for someone who did the same for free – and there will always be someone who will.
Generally people only charge for labor (in barter or currency) when they are ‘working’, which is doing things they don’t like and wouldn’t do otherwise.
People will still create art, play sport, play music, write software and report on news whether they are paid or not. Maybe it won’t be up to the same ‘standards’ as the current news system, but then it will be in as much depth as the reporter chooses to go – which could be in far more if the journalist has an interest (eg. GrokLaw). This is not to say all paid reporting will disappear, just as un-paid reporting will not either.
Creating a paywall to create artificial scarcity is actually a bad move since it is advertising that drives the revenue stream – just ask Google. No news agency has a sufficient monopoly on reporting to make people pay for the news in sufficient numbers and the drop in eyeballs will be calamitous as advertisers will not pay top dollar for a shrinking market. Free reporting will pick up the slack and since the internet has global reach the mesh of such reporting will be sufficient to cover the globe. Despite the multitude of money-collecting news agencies most of them get their sources from a handful of reporters on any issue anyway.
This is a boneheaded move from Byzantine management thinking struggling to adapt to the global internet where artificial scarcity is very difficult to maintain and entice users to buy into. Hope you don’t have shares in those companies.
Edited 2010-07-12 07:26 UTC
Well, that was one ‘mother’ of a post
Funny, given how absurdly slanted your response was… and unrealistic too. Lemme guess, early to mid twenties, two college loans with mommy and daddy still giving you money, either US west coast or somewhere in the Nordic states of Europe? Either that or a Kiwi. Sorry, the attitude (and ignorance) just kind of screams that.
If the father didn’t run like a gutless coward, he does. If not, poor woman works two jobs to pay for the mistake — otherwise the state ends up footing the bill, so in a way we all do…
Unless you’re in some third world undeveloped nation where people don’t even go to the hospital for births… What’s the infant mortality rate across the spine of Africa again? 1 in 8 stillborn, 1 in 5 before the age of five? A little civilization and money to pay for it is a good thing. Do we even want to talk Sierra Leone?
Traditionally? The father who goes out to work and pays for everything… nowadays? The mother goes out to work and has to pay someone else to watch the kid since the father usually isn’t man enough to bother — so she’s not even doing that labor anymore. (Be a man, raise your **** kids, keep it in your pants, or at least wear a **** raincoat!)
Who says raising a healthy child isn’t a reward unto itself – but of course that’s a loaded question since spin it around and who’s paying them so they can raise the kid when they aren’t working… It’s called a job!
In college mommy and daddy usually are paying for it, or they put themselves a decade into debt with college loans helped out by others who are still having life paid for by mommy and daddy or on credit. Then when they grow up they have to go get day jobs and it ends up stillborn, or they are lucky enough to find someone who will ACTUALLY pay them to keep working on it. Right Linus?
BWAHAAHAA… Ok, rule one, don’t argue that with a history minor. Not only will they laugh in your face, they’ll point fingers and say “hey, look at the …”
The exchange of coin or goods for labor predates written history; from shiney beads to gold coin, monetary exchange has been the basis of every major civilization… and the history of labor without exchange is not a pretty one you want to be bringing up – much less being the exception, not the rule. There’s a reason we have the aphorism “A man worth his salt”
Imagine the husband wasn’t able to go out and find a job to pay for his not being able to keep it in his pants — Imagine the mother couldn’t go out and find a job to get a decent days wage for a decent days work or that the state wouldn’t pick up the slack through programs like WICK… Imagine living in one of these pre-industrial third world hellholes where the kid is put to hard labor before they’re old enough to walk, and end up member of a rape gang running around with a AK-47 by the age of 12.
A little civilization goes a long ways.
Yes, working… like professional artists, professional sportsmen, professional musicians, professional software developers, and professional news reporters. To compare the people working those as their JOB to some home hobbyist rubbing one out in their basement is a travesty of the highest order — especially when some of those people have college loans they are trying to pay off and a family to feed.
and yet the coffer is not bottomless — see the continually skyrocketing cable fees and increase in commercial time the past twenty years, where in th 70’s and 80’s a half-hour show without commercials was 22 minutes, today it’s 17… and don’t tell me it costs the cable company $60/mo for basic 60 channels. Most of that is cycled back to the stations in rebroadcast fees becuase the commercials aren’t cutting it for revenue.
… and forget not the original dotcom bust, which can partially be blamed on the ‘advertising can pay for anything and everything’ mentality; Just ask Juno, NetZero, and KMart’s Bluelight how well that worked. For every success, there’s a rather depressing body count they are standing upon.
You go on about free agencies – so why is someone even WANTING to charge for services an issue then? This is the part that burns me, you don’t want to pay for it, DON’T. The Internet on the whole is a luxury, NOT a neccessity (unless it’s your job) and frankly too many people are getting their panties in a twist over that luxury due to this increasing sense of entitlement. Magically we’re supposed to just have a means of life materielize from thin air or something.
Life doesn’t work that way.
Edited 2010-07-12 13:08 UTC
Thanks for your reply. I have no problem with people charging with what the market will bear, in fact I have my own business. I think we agree on that. I was trying to point out several things (which I’ll extend upon a bit) since your original post insuated that for-profit is the principal reason people produce stuff (perhaps that is not what you meant):
* paywalls don’t work when people will provide the same stuff for free. Especially when some of that free stuff is of good enough quality and sometime superior. Since news is not really that scarce they need to be thinking that people will pay for ease-of-use instead. However, paywalls are a large barrier to ease-of-use.
* conventional economics and measures of productivity don’t account for much of the labour actually performed in the world. Most of this labor is unpaid, unrecorded and free. Clearly accurately accounting for this labour is difficult. This is only one of the limitations of the economic models we have. That also means that care has to be taken when using economic models to determine the future or justify courses of action. Sound judgement is also required.
* people will do stuff they want for free and their reward is sharing it widely with others. I certainly do this with a lot of the products I create, and it is only some of them that can be charged for. Clearly not everyone acts this way, but it is not like the profit motive is the only reason that people do stuff. In fact it seems the exception (as I hope my over-the-top examples seemed to illustrate).
Incidentally, it is good you have a minor in history. Fortunately I understand this Americanism, however you should not always assume all your readers do. While historical insight is helpful it is not necessarily relevant to a discussion on economics and probably no more relevant than my PhD in (astro)Physics. (giving quantitative and qualitative understand of the limitations of economic models).
Edit: typos
Edited 2010-07-12 20:19 UTC
Didn’t read the whole article (to late, no time), but free as in no payment isn’t the free the internet is all about. What we really need to fear is the end of the free internet concerning free speech and democracy. More and more countries install internet filters with secret blacklists. That is censorship. That is against democracy. If the webpages on the blacklists are criminal they have to be taken down and the list has to be public. Everyone should know which site is engaged in criminal activity. Leaked blacklists from countries that already have these filters show that most blocked sites are from countries that would cooperate in taking them down (USA, EU). Also a lot of the entries of the leaked lists are actually added by mistake (if one assumes no ill intent for the persons who made the lists).
So free speech is at risk, which is much more important than gratis newspaper websites.
And how it will screw the majority of the public out of information that is quality. Greed is the root of evil, and the publishers out there are finding out that Google Ads just don’t pay the way when their hacks don’t produce quality product folks want to embrace by buying items from their advertisers.
Most certainly people/businesses can charge for their content. Most newspapers already do that, only showing basic stuff for free. For the real news you need to subscribe. Most often it is more expensive than getting the actual paper and reading it for the same content.
The problem truly lies in the fact that we are heading towards a second depression here in the US. With wages decreasing and more and more people out of work, there are less people that even have any money to begin with. As more people have less money then they have ever had, the new sites that charge really will not stand too much of a chance. As costs go up to access sites, the readership of those sites will go down. Take that into consideration, and it is easy to realize that if people can’t afford to access some sites, which might be the only reason they have internet to begin with, they will also cancel their internet service. Less people on the net really means less information of value available, and less people that can access said information. The math is pretty straight forward.
Edit: Typo in Subject
Edited 2010-07-12 02:28 UTC
The reason for the dispair of the media companies at the moment is that nobody has figured out how to make advertising pay on the web; and they also haven’t figured out how to make users pay.
Most users will never pay for anything on the net. Every time companies have tried pay-per-view, they’ve instantly lost memberships. Just ask Facebook.
In short; the system is strong enough to sheild itself from the threat outlined in the article
This is both good and bad. On the one hand it’s great that the internet will remain mostly free.
On the other hand, very large media companies who have huge staff, and who spend bulk dollars on quality investigative journalism will go to the wall. This is unfortunate, and will mean lots of lost jobs, as well as a shortage of quality reporting, particularly those involving foreign correspondents.
But that’s life, and new leaner companies will emerge to take their place. I imagine these new companies will not be tied down to the old tired practices of the behemoths they replace.
I would also like to think these companies (likely community based) will be less prone to the crazy political bias that you find with so many big media companies today (Take a bow: Fox News).
I have nothing against paying for content as so long as they give me value for money and better still, actually sell it to international customers. Its been how long since Kindle has been launched and Amazon still don’t ship it to New Zealand?! come on, its clusterf-ck stupidity such as that which is the reason why things don’t even take off. A horrible CEO treating the US as the only market worth being concerned about thus blocking out the potential customer base from a over a billion down to a few hundred million.
It’s about time that WSJ and NYT started charging! It is a bold statement that pierces the unreality of an economy based on advertising, a statement that says “We stand by our goods with the only measure that means anything anymore: cash.” I fully support this move, and I look forward to paying.
Lumping all media outlets that charge for content into one group isn’t fair, and newspapers are not AOL. Groups that create content should not only have the right to charge, but they have an ethical imperative to do so. Bravo for getting some spine.
And for the record, it’s really sad that we talk about newspapers or anyone else as “content providers”. Such a life-sucking, soulless, corporate-bland term should only be reserved for the likes of Yahoo et al. Or that we judge the media by such absurd metrics as “value for money”. I mean, what does that even mean? Was 50 cents the right price for Deep Throat? Are Tarantino and Antonioni to be judged by $8 ballot stubs, $10 with popcorn? The media gives us life, and we owe it our own life-force, which is, again, our money.
Edited 2010-07-12 05:55 UTC
Whole-heartedly agree on this. Some people say money is a new invention, which it is, but compensation is as old as the primordial ooze that we crawled from. Even in the animal kingdom work is rewarded for value attained — lions that protect the den become alpha, etc. The leech mentality of people these days is rather depressing, because it devalues those around them.
Pay it back, pay it forward, it doesn’t matter, work needs to be compensated in some way else we wouldn’t do it. The dollar, euro, peso, etc, are all just standardizations of barter compensation, and refusing to pay dollars or euros or pesos or whatever simply shows that the leech consumer holds no value in work.
To those others reading this: If you don’t value the news feeds then don’t read them. If you do value them, then pay them what they’re worth. If you don’t want to pay $10/month for their news because it’s not worth it to you then don’t read their stories, read somewhere else. Hell, someone might setup a pay-per-article site that might suit you more.
They also gave us Rathergate and an endless list of cases where information was withheld from the public or distorted to push an ideology. This pattern of deception is well documented and I find it sad that so many still support these monolithic outlets that clearly have no regard for objective reporting.
I don’t owe them a damn thing. I never thought the paper was worth 50 cents given how often journalists would insult my intelligence with their skewed coverage. Or how about the silly “two sides debate” coverage where one side is clearly inept and only exists to give the appearance of debate.
The best paper I ever bought was used as campfire fuel. If anything journalists owe us an apology for pushing so much bullshit onto the public.
And by not paying for their content, we demonstrate that they’re not worth it, so they close shop. At least that’s what would happen in my ideal world, where such outlets, or any business industry. are not heavily subsidized via bailouts, etc.
Whenever I hear this, I don’t think about content like music and movies. I think about specifications, RFCs and protocols (etc etc etc) and most news falls into this category, but if you provide more than just news, ie investigate reporting etc, then it doesn’t apply for that. The important things that are almost required to be free and open for all, for interoperabilities sake and to keep people informed about what is happening. After all, it’s pretty nice to not having to pay to know there’s an election coming up, or that your hospital is being moved.
Content like interviews, music and whatnot doesn’t fall into this free and open category imho. They can be free if the producers so chooses, but doesn’t have to and I don’t expect it to be. Wonder how the porn industry has changed over time. How many provided subscriptions 10-15 years ago compared to today?
Are you saying that 10-15 years ago most were free and now most are not?
If so, it was probably in its infancy, there were enthusiastic webmasters and proud amateurs sharing their feats. Until they realized the money they could make. So why say no to that financial manna when it’s there and only waiting to be harvested?
Porn is probably not the only industry in that situation.
If so, I concur and give the specific example of dating sites: this week-end (i.e. two days ago), I was on a classified ads site and I came across an ad for adultfriendfinder.com that was touting “100% gratuit” (which is “100% free”). Guess what? Creating an account is indeed 100% gratis but you can’t do anything, not even view a profile without paying. And I wondered why I should pay 100+ € for a service I didn’t know anything about 10 minutes earlier and that I can’t even try.
The same practices can also be found on meetic and ulla and these didn’t encourage me to spend more than 5 minutes on the website.
I remember some of my student years around 2000-2003 where free dating sites were maybe not the norm here in France but they were frequent. Then meetic came out of a dark closet, bought competitors, had partnerships with others (like Yahoo’s dating service, I forgot the name) and ended up having built a stronghold of monopoly.
Old media spends millions trying to force everyone to fit their old models of distribution instead of innovating and adapting to the new reality. People will (and do) pay for content. e-books, itunes and netflix are all profitable examples. You have to offer something the consumer finds valuable and you have to offer it at a reasonable price. The biggest problem seems to be the content providers feel their content is worth a lot more than the consumers do. I have unlimited steaming from netflix for $10/month. The rumor is TV shows will cost $1 per episode to stream at other outlets. Count how many shows you watch a month. I bet the bill will be higher than your cable/satellite bill. Now figure that their cost of distribution is probably LESS with streaming over the internet. What justifies the added cost? The same it true with newspapers. They want to charge the same or more for a distribution channel that cost them less. No wonder these business models fail.
Actually, I’ve reached the end of the Internet many times. It was a simple page, similar to the following:
42
The real struggle is not about whether news corporations offer little value for money or whether users are willing to pay for the internet (they already do, to the ISP). The problem is that technology is making ever more clear how the concept of “intellectual property” cannot be enforced without draconian legislation that puts an end to any trace of privacy and speech freedom. One of the two has to go.
For instance, many news corporations realize that copyright is not enough for news, because a blogger can tell the same news in his own words, and it’s essentially just as good, so they are lobbying for legislation that makes them own the news themselves. Can you imagine a world where you can’t legally speak with your friends about what you’ve just read in the newspaper? It’s not as far as it seems.
There’s only one kind of property. Either your computer, your pen and paper, your mouth and your brain are yours to use as you see fit, or they are not. So-called “intellectual property” is just a particular kind of first-come first-served legal monopoly, so “intellectual monopoly” is a better name for it.
Get rid of all IP legislation and let the market decide how demand and supply will meet for the service of intellectual production, including news and commentary.
They seem to attract people that are completely full of shit.
ABC, NBC, CBS and CNN are ran by dishonest boomers from the 60’s who still want to push their left-wing ideals on the public.
Fox News is some bizarro opposite combined with the classy presentation of a late night sports show.
NPR is filled with pretentious twits who try to hide their intellectually dishonesty with a dry, monotone presentation.
The major media outlets have made it clear that they do not at all care about objectivity. We see this every year with politics whereby each media outlook clearly takes a side.
Let the bleed, come up with new pay structures, whatever. Their level of influence has waned and will never be restored.
But could this be a trend that could snowball enough to change the nature of the net?
No. Next question.
i disagree with the notion that the main use of the internet is reading news be it from big media companies or from amateur blogs. if this is going to require making payments regardless of how small then i doubt many people will even remotely consider it. the semi retarded blogger who wants to make a living by posting crap while sitting on his/her couch should figure out another way to do it.
the cost of the internet connection is more than enough payment to use what the internet has to offer which is so not about news/blogs.
The problem with micropayments is a few fold.
1. Getting a universal payment system is hard. It’s not a difficult technical challenge per se, but it’s hard to get everyone to agree on how billing is done and where the bill goes. Not a huge problem. The ISPs could do it.
2. People hate micro-payments. I hate text message charges. oh 10 cents a message. I avoided text messaging like the plague until I got a text message plan for $5.00 a month. I still don’t have data on my cell phone for this very reason. I’ll wait until I can be confident that I won’t go over and be charged up the ying ynag. The last thing I want is to sit there and watch my webusage keeping track of what websites I go to.
Whatever payment system evolves… and I think there will be one, will probably involve a monthly payment like you have for the internet/cable.
Let’s say your ISP gets together with media companies and says we offer you free access to NYTimes, washington post, XYZ, DEF… for an extra $5.00 a month. They can figure out behind the scenes how to divvy up the money (maybe google analytics on usage or something).
During the world cup, my ISP offered special ‘streaming’ for the world cup for ISP customers. They just need to extend the model. You needed to login. I wish they made it automatically detect if they’re your isp
If you’re out of your home, then you could logon somehow.
Best of all, it had better be reasonably cheap. I can’t figure out the pricing model for some sites.
I visit fora.tv a fair bit. It’s like ted ( an educational youtube). Recently they introduced subscribing to channels. Like you can get access to special ‘Christian Science Monitor’ videos for 14.95 a month. Jesus. Are they mentally insane? 14.95 a month not for full access to fora.tv. Oh no. 14.95 for access to a specific channel within it. Ummm… how about hell no.
However, what is interesting, is that you can’t find all their content elsewhere. It is a really good site. One I would pay for. Just not $14.95 for a single channel. Even cable doesn’t rip me off that much
Edited 2010-07-14 23:17 UTC