Commentary

Asking Consumers To Pay For Programming Also Means Giving Away Free Content

What do you keep? What do you give away? Take a big breath. In this digital world, as it concerns TV, you need to do both. And maybe give more away free than you think.

TV sellers are thinking more about this unsettling formula. Some newspaper publishers already have a plan. The New York Times will allow its visitors to look at 20 stories a month for free. If they want more, it's going to cost them.

For some time, Hulu and other TV providers have been struggling with this. Many viewers are mostly using the free Hulu -- the one where you can see the last five episodes of a recent TV show. Any more than that -- or accessing older library shows -- will cost you.

Look for more shifts in cable TV content. Cable has always been synonymous with pay TV. But consumers want a new-wave formula of pay and free. Thus there is concern over cord-cutters -- or, the more passive form. cord-shavers (where consumers may scale back their premium cable TV options like HBO).

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Music labels might take note here. Digital platforms -- featuring lots of free, mostly illegal content -- rose up and swamped the business. That built unwanted consumer behavior -- a surge in the belief that consumers could always get music for free.

TV sellers, of course, don't want that to happen -- and, so far, have sent out the message that free TV/video viewing may be limited. Many consumers are adjusting, uneasily, to all of this, but will probably be ready to pay more for content, as long as meaningful stuff -- you know, full TV shows -- continues to be free.

Why the importance of free? It's used to promote, to tease, to spin some future endeavor. Even straightforward new age digital content has had growing pains around this. Recently, thousands of bloggers who had their work appear on The Huffington Postt said they wanted to get paid. And legal activity has started up.

Huffington Post spokesman Mario Ruiz wrote in an e-mail: "As we've said before, our bloggers use our platform -- as well as other unpaid group blogs across the web -- to connect and help their work be seen by as many people as possible. It's the same reason people go on TV shows: to promote their views and ideas."

Note that The Huffington Post also has a paid model. The email goes on to say: "We operate a journalistic enterprise with hundreds of paid staff editors, writers, and reporters."

A Comcast executive at this week's NAB event would agree. Richard Buchanan, VP- GM of content services, says: "The toughest decision in this business paradigm is what do you sell and what do you give away? And right from the start, you better get that right. A good partner in the [content] ecosystem rewards everyone along the food chain."

In other words, everyone needs to be paid. But just what is anyone's guess.

1 comment about "Asking Consumers To Pay For Programming Also Means Giving Away Free Content".
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  1. Sheila Seles from Advertising Research Foundation, April 15, 2011 at 10:06 a.m.

    Yes, everyone deserves to get paid. And content that's expensive to produce (like TV) isn't going to be any good if there isn't any revenue coming in to pay for production. But here's the rub: people are cord cutting, illegally downloading, and legally and illegally streaming content. It's going to be hard to all of a sudden expect people to pay for what they were getting for free. Of course TV cable subs aren't free, but the subscription model is different from an a la carte model like VOD. It seems to me that instead of trying to impose new paid business models after people are used to free, publishers should be figuring out how to monetize "free" content. Advertising has worked for the last century or so, and it seems that there are no shortage of brands that still want to advertise. So play with models--see who will pay for what and who will watch ad supported content. It may take more than one business model because there's more than one way people are already consuming media.

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