Tag Archives: free news

Free News and Faster Horses

We are going through a once in a lifetime shift in the media business, an inexorable move away from the economics that sustained ‘Big Media’ for the majority of the 20th century. From Chris Anderson’s Freemium to The New York Times erecting pay walls, the issue of paid content is about as hot as it gets right now. The underlying notion that you give the content to readers and pay for it through advertisers is going away, to be replaced with a plethora of different ideas about how it may (or may not) be possible to monetise content online.

All this in the face of multiple studies that consistently show only a minority of customers say they want to pay for content online:

  • PCUK/Harris Poll (5% of 1,888 UK adults said they would pay if their favourite online newspaper began charging).
  • Gfk (total 18% of UK adults in international survey of 16,800 said they didn’t want to pay for “content”, ie. “news,
  • entertainment and information sites such as Wikipedia”).
  • Continental (total 37% of 500 UK adults said they would pay micropayment, larger fee or monthly/annual sub for online newspaper/mag).
  • Olswang/YouGov (total 19% of 1,013 UK adults and 536 teens said they would make micropayments frequently, a subscription or otherwise pay for news articles online, on mobile or ereaders if there was no free alternative).
  • Oliver and Ohlbaum (“15 to 20% of respondents [survey of 2,600 UK consumers] said they would pay £2 a month for their favourite news website if it was the only one that charged”).
  • Forrester (total 19% of 4,711 US consumers said they would make micropayment, pay a sub or buy a bundled print/web/mobile package for online newspaper).
  • Boston Consulting Group (48% of 5,083 regular internet users in nine countries, including 506 in UK, said they would pay for online news).
  • KPMG (11% of 1,037 people aged 16 and over “currently spend anything on online media” – findings vary for different media types).

Taking all eight studies in to account, the average proportion of consumers who would pay for online content is 21.8%.

While this is interesting, it is pretty well documented that people are poor at understanding what they want. It surprises me therefore that we continue to treat these numbers as if they actually mean something about whether people will pay for content online, or whether there are workable models for paid content.

We need to start looking at these surveys with a healthy dose of scepticism.

While Rupert Murdoch seems to be treated as a sort of mad uncle of the internet currently with his “crazy ideas” to make people pay for content, in reality what he understands is that it is not a case of customers never being prepared to pay, just that they’d rather not. Sky cracked the subscription TV market in the UK with the introduction of Premiership football.

We seem to be treating a mass media meltdown as a certainty, when in fact there are still opportunities for the big players to make their existing models work – with a few tweaks. What if Murdoch included a subscription to The Times with Sky TV packages for an extra £1 per week? Give customers a workable concept and they may just sign up. Ask them to come up with the concept themselves, and they will be lost.

I would suggest checking out Bad Science by Ben Goldacre for further demonstration of how what people say is often miles away from what they actually think, or may think given different options.

A final example, and this is my favourite, that perfectly encapsulates how consumers have difficulty in really getting to grips with what they want, comes from Henry Ford, who created the mass market for automobiles. He was once asked about the importance of the ‘voice of the customer’ in his business. His reply was surprising: “If I’d asked people what they wanted, they’d have said ‘faster horses’.”

There is always opportunity for a person or organisation with strategic vision to come up with an idea that changes the game. Given a different context, people will have hugely different ideas about what they want or need.

In a world of horses, people don’t want cars. They want faster horses.

In a world of free news, people don’t want to pay.

The customer is not always right. Or better put, the customer does not always have the imagination to be right.