Net Loss: Most Online Readers Won't Pay For Content

by Erik Sass , October 27, 2009

money/xout

The latest plan to save newspapers -- charging for online content, perhaps with a system of micropayments -- has been slightly deflated by a new survey from Ipsos Mendelsohn and PHD, which found that over half of online readers said they wouldn't pay for online content.

This is due partly to their conditioning over the last decade of Internet use, when they grew accustomed to getting online content for free. That's an irony, considering that free delivery was the newspaper publishers' own online strategy.

Specifically, the survey of 2,404 American adults by Ipsos Mendelsohn and PHD found that 55.5% of respondents said they would be very unlikely to pay for online content from newspaper or magazine publishers, versus 16.5% who said they might pay (including a number of fence-sitters).

The numbers may be due to the fact that they engage with online content less intensely, or at least for a shorter period of time. On average, respondents only spent about nine minutes reading a print publication's Web site, versus about 18 minutes for the print product.

But only 3% of respondents actually read both the Web site and the print publication -- implying that the increase in online reading is correlated with a decrease in time spent with any individual publication's brand.

The survey by Ipsos Mendelsohn and PHD is not encouraging for newspaper publishers hoping to rebuild online revenues with paid subscriptions or a system of micropayments for individual pieces of content. However, there are a variety of different approaches to charging for online content; some might work even if only a small percentage of online readers agree to pay.

One of the most-discussed proposals for a micropayment system comes from Journalism Online, founded by Steven Brill, which has assembled a consortium of newspaper publishers with the goal of designing and implementing a flexible micropayment scheme that could be used across multiple sites.

Responding to skeptics who argued that most people won't pay for online content, Brill has said that Journalism Online's model would only require 10% of visitors to pay for certain, selected premium content, with the other 90% still able to view regular content for free.

online publishing

2 comments about "Net Loss: Most Online Readers Won't Pay For Content".

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Howie Goldfarb from Blue Star Strategic Marketing, October 28, 2009 at 10:51 a.m.
I personally say throw this survey out the window. People will start paying when they see content disappear. When news sources drop to just a few. The problem is that we have too much choice. Before the internet we had a local newspaper or three, and Network TV and Radio news. Now you have so many channels on cable, every local station (TV and Radio) have their own websites, and we can read newspapers from all over the world instantly. Technically we only need 10 to 15 news sources to have objective competition duking it out for subscription dollars. But we currently have 1000. It has diluted distribution even if it hasn't diluted content since so many websites put out great content.
I mean seriously. If an organization can not make money or at least cover expenses they can not exist and they will disappear. And I personally would rather pay for content than have Ads served to my browser. I find it amusing that back in the day we were all content with one newspaper to read and now the thought of choosing one and paying freaks everyone out.
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Jonathan Mirow from BroadbandVideo, Inc., October 28, 2009 at 6:08 p.m.

Howie, howie, howie - you just don't get it, do you? Here is the rule of the online universe (write this one down) the ONLY TWO THINGS that people will pay for online is financial information and adult content (and really, only idiots pay for adult content, so it's really ONE THING). That's it. No exceptions. The internet is littered with the rotting corpses of failed "pay" experiments. I know it's sad, but once the technology is out of the box, you just can't stuff it back in. Ask the record companies, ask video hosting companies, ask the Rocky Mountain News. We all pine for the good old days when we thought we could charge for online content. Now, let's move on.