Are there enough people who are willing to dig into their pockets and pay real money to consume news online?
That’s the question the digital publishing industry has been wrestling with for many years – and has been asking in increasingly urgent tones as revenue from digital advertising has plateaued for some and declined for many others.
So it was little surprise that there was an impressive turnout for the launch of the Reuters Institute for the Study of Journalism and Kantar Media’s report into attitudes to paying for online news.
Fronted by the ever-insightful Nic Newman, the report revealed some cautiously encouraging stats for publishers keen to find a way for a sustainable future which doesn’t solely rely on the dwindling pot of advertising revenue.
It’s well worth reading the full report, which was funded by Google’s Digital News Initiative, but the main theme I take from it is that there is a willingness in theory to pay for news online from a reasonable proportion of people – but they don’t always do so.
As the authors of the report say:
There is value is various aspects of news – both the content and the delivery format – but this
is tempered by the context of abundant free content. The problem is exacerbated by the
fleeting nature of much news, which quickly dates and becomes worthless.
And some of reasons for people not being willing to pay for news are summarised in the slide below.
So, it seems, one of the key reasons people don’t currently pay for news is simply because they usually don’t have to. There are such a variety of sources of free news around that the perception is that there’s rarely the need to pay.
The exceptions mostly appear to be those which offer niche or high-value content, the Economists and Which?s of the world – rather than the mainstream news offerings.
There is value in news about specialist topics and coverage of niche interests, as well as
content from writers of repute. There is also value in variety, which allows serendipitous
content discovery, as well as evergreen content that remains relevant beyond the daily news
But the question that was left hanging tantalisingly in the air was what would happen if the norm was to have to pay for good quality content from the vast majority of publishers. There was a sense that, just as people have got used to paying for music on Spotify and films on Netflix – they may get accustomed to paying for news online too.
A number of options on how to access news content were given to the subjects of the research to understand their willingness to do so:
- Propositions that permit or bypass advertising eg providing an email address to allow tailored advertising, turning off ad blockers or paying for an ad-free experience.
- Fundraising propositions eg fundraising to support the brand/business or paying for membership with benefits
- Paywall access and subscription propositions eg paying for unrestricted access (soft paywall), paying a brand subscription (hard paywall) or pay-per-use (micropayments) of a bundle of providers (aggregation)
The option that particularly interested me was the final one – the idea that users could pay small amounts of money to access content across a range of sites. And it seems that consumers were also inclined not to dismiss the idea:
This proved the most interesting and appealing proposition for paying for online news, and
had been anticipated to some extent in the consideration of the other propositions. It actually
combines two ideas – micropayments and aggregation – both of which resonated to some
extent, although the aggregation element drew stronger support.
One of the major problems with micropayments up to now has been the high level of effort asked of the consumer to access content. Can you really expect someone to fill in a laborious sign-up form and proffer their credit card details just to access a piece of content with a value of a few pence? And then ask them to do it again for a different publication.
But there are signs this is changing. Google has recently announced that it is offering publishers the chance to be a part of its Google Contributor scheme which allows users to buy an ad-removal pass to use on selected sites, starting at £5 in the UK. Business Insider is one of the better-known sites signed up.
And there are other companies out there working to make it as easy as possible for publishers to ask for small amounts of money from their users. Propositions from the likes of Blendle, Jamatto and Admiral offer publishers the ability to add micropayments into their business models, while Medium recently launched a membership model which is a variation on the same theme.
If there was a way to make the experience of paying as seamless as it is when you download an app from the Apple or Google Play app store – and to include content from a range of sources within one safe, secure wallet – then perhaps there’s a glimmer of a future business model for an industry in real need of recalibrating the value exchange between themselves and their consumers.
Think you might need some help moving your digital media business to the next level? We’d be delighted to help. Please get in touch and let us know what you are trying to do.