Commentary
Consumers Will Pay For News if Unique, Not Yet Known
- by Jack Loechner , Staff Writer @mp_research, December 2, 2009
John Rose, a BCG senior partner, said "... contrary to conventional wisdom, consumers are willing to pay for meaningful content... (but) they are not willing to pay much... "
The survey found that consumers were more likely to pay for certain types of content, specifically news that is:
1. Unique, such as local news
- 67% overall are interested
- 72% of U.S. respondents
2. Specialized coverage
- 63% overall are interested
- 73% of U.S. respondents
3. Timely, such as a continual news alert service
- 54% overall are interested
- 61% of U.S. respondents
4. Conveniently accessible on a device of choice
In addition, says the report, consumers are more likely to pay for online news provided by newspapers than by other media, such as television stations, Web sites, or online portals. They are specifically not interested in paying for news that is routinely available on a wide range of Web sites for free.
These findings will benefit newspapers with unique voice and reporting and with strong subscriber bases, such as national and local newspapers, which have content not available elsewhere, while major metropolitan daily newspapers will likely struggle, concludes the report.
In the United States, advertising, which accounts for around 80% of newspaper revenues, is in a steep decline. If consumers pay for their news online, it will slow, but not stop, newspapers' decline, says the report.
The report suggests that several hybrid models for accessing news and content will emerge. For example, 52% of U.S. consumers of business news would be interested in a bundled print-and-online subscription, compared with just 35% of young consumers.
Marc Vos, a Milan-based partner and leader of BCG's media sector in Europe, says "Newspapers should be experimenting with paid online content... It will take trial and error to find what works."
On the flip side, a Forrester study, reported in an OPA Intelligence Report by Mark Glaser, found that 80% of Americans were not willing to pay for newspaper or magazine content online.
Glaser says that with all the noise around erecting pay walls online, two different surveys tried to find out whether people would actually pay up. But their results were also different. The Boston Consulting Group found that 48% of Americans are willing to pay for online news content, but only about $3 per month.
But the Forrester survey, noting that while 80% of Americans were not willing to pay for newspaper or magazine content online, 8% said they'd pay one subscription fee for all content, 8% would pay for a combined print/online/mobile content subscription, and just 3% making would make micro-payments.
AllThingsD's Peter Kafka is betting on the Forrester number, or one even lower, supported by the fact that the BCG study finds that readers "are specifically not interested in paying for news that is routinely available on a wide range of websites for free."
To read more from the Boston Consulting Group, please visit them here.
Jack Loechner is the Editor of The Center for Media Research's daily Research Brief. You can reach him at jack@mediapost.com.
Interesting report, but this survey was taken in countries around the world. I'm guessing many of those countries do not have all of the media resources we have in the U.S.
I'm not so sure that the percentage of people who would actually pay for unique content would be as much in the U.S. And I think that some advertiser supported sites would immediately jump in as competition and "report" the same information at no charge.
[sigh] As long as ONE upstart news organization is willing to give away its content to steal audience share from the others, to gain a tiny advantage with online advertising, it simply doesn't matter if consumers are willing to pay lumbering dinosaur corporations. The surveys did NOT ask, would you pay site x for news, if site y gave you the same thing free? Nor does it ask, do you think news will dry up from Twitter and Facebook if the mainstream news sources convert to paid content?