Free v micropayment - what will work?
Jinfo Blog

19th November 2009

By Penny Crossland

Item

It seems that hardly a day goes by without newspaper bosses pronouncing on plans to keep their newspapers alive and without research results being published to either refute or confirm proposed business models. After the recent verbal battles between Rupert Murdoch and search engine goliath Google, it looks like this week the dust is beginning to settle. Two research studies published by the Boston Consulting Group (http://digbig.com/5baqtc) and Continental Research (http://digbig.com/5baqtd) have provided struggling newspapers with some good news. Research results indicate that consumers are willing to pay for online news, but they don’t want to pay much and they only want to pay for specific content. The BCG report surveyed people from nine countries and found that what online readers of news were prepared to pay varied from country to country ($7 per month in Italy, and around $3 per month in the US and Australia). In exchange for these micropayments consumers expect to receive up-to-date news, unique content such as favourite columnists or local news – and all of this accessible via devices of their choice, such as mobile phones (see this related posting http://www.vivavip.com/go/e26538). They are not prepared to pay for news which is readily and freely available elsewhere on the web. Fair enough. These findings could provide newspapers with some respite – charging their readers something for news will not stop their decline, but it should slow it down. However, the editor of The Times has dismissed the idea of micropayments (http://digbig.com/5baqsy), opting for a pricing model that from March next year will charge for a 24-hour access to the digital paper alongside a subscription model. James Harding believes only this will guarantee editorial quality. The Guardian, which is also adopting a print subscription model, is adamant it won’t put up a paywall for its digital paper. Maybe only trial and error will show us what model will work best.

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