Nielsen: Users Won't Pay For Web Sites

by Wayne Friedman , February 16, 2010

Internet consumers prefer free content -- so much that they will stop using those sites that would begin to charge.

A new Nielsen survey says 79% of users would no longer access a Web site that charges them. The finding also assumes that consumers can find the same information at no cost. The new report from Nielsen surveyed 27,000 consumers from 52 countries.

Looking at new fee-based areas, the survey shows that 71% of global consumers say that if have to pay for online content it must be considerably better than what is currently available for free.

As for the quality of information, consumers were mixed as to the question about whether quality would suffer if publishers could not charge for content. About one-third (34%) say quality would suffer, but 30% believe it won't. Another 36% have no opinion.

More than three-quarters (78%) believe that if they subscribe to a newspaper, magazine, radio or TV service they should be able to use its online content for free. Once consumers pay for content, 62% believe they should have the right to copy or share it.

Ad-supported content factored into the equation. Some 47% were willing to accept more advertising to subsidize free content. But 64% believe that if they must pay for content online, there should be no ads.

Nielsen chart

internet, journalism, news, web sites

9 comments about "Nielsen: Users Won't Pay For Web Sites".

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Douglas Ferguson from College of Charleston, February 17, 2010 at 8:58 a.m.
Why buy a cow when milk is free? OK, inept analogy that's usually used for something else, but it's still true that content providers have considerable competition from upstarts that give their stuff away to gain a toehold. Sure, those upstarts intend to charge once they gain sure footing, but newer upstarts spoil their plans by offering even newer sources of free content. It's a never-ending cycle. I suppose WSJ and other specialized content might be able to make a buck behind the paywall, but most of what passes for content isn't worth paying for if it is so readily available elsewhere, usually from some newer service. News, thanks in part to social media, as become a commodity.
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Carl Forsell from Connections Planet, February 17, 2010 at 9:19 a.m.

Newspaper web sites charging for content is the same business model as the post office raising rates because not enough people are using snail mail.

Newspaper circulation/readership is in freefall. In my humble opinion, and the reason I very seldom read a newspaper (even though I used to work in th industry and have a degree in Journalism), is that journalists are no longer true to their trade. They are no longer reporting the facts. They are pushing their opinions. What passes for news in many newspapers would not have gotten me a passing grade when I was in Journalism classes.

So... will people pay for biased reporting? I can't speak for others, but I will not.

Ruth Papazian from Wolters Kluwer, February 17, 2010 at 9:44 a.m.

Most of us have cable TV and pay a monthly fee for access to programs. With PPV, some high-value programs, like prize fights, require an additional fee - but everything else is included in the package. Most of us have broadband Internet and pay a monthly fee for access to content. Some high-value content can carry a separate fee, but having to pay a fee each time we want to read an article or watch a clip of a Jon Stewart monologue on top of the hefty fee we already pay for access is asking too much (and I say this as a content producer who wants to be able to pay the rent and to eat). As with cable, an Internet access package should include the content.

Nelson Yuen from Stereotypical Mid Sized Services Corp., February 17, 2010 at 10:17 a.m.

Kudos Carl.

Completely agree with you. (ONE A SIDE NOTE...) I think society has a major issue with qualifying "unbiased" or "bipartisan" content. The biggest difference between 2010 and 1910 is that when you read the news in 1910, you KNEW you were getting an opinion. Protesters, right and left wing parties, and satirical publications were transparent about presenting a biased opinion. Today it is much different. News programs and journalists pretend to be unbiased while skewing the facts one way or another. So it becomes difficult for the general public to valuate news when they are being bombarded with different opinions from multiple platitudes.

Mike Einstein from the Brothers Einstein, February 17, 2010 at 10:36 a.m.

With prime-time ratings now in the low single digits, newspaper readership in the dumpster and magazines folding like cheal card tables, it occurs to me that the jury is already in: Who in the world will pay to watch something that they don't even want for free?

The fact that the media franchises are the last to accept this sober reality speaks volumes about why they're in trouble in the first place.

William Stromire from MyeTrek, LLC, February 17, 2010 at 11:46 a.m.

Why buy a cow when the milk is free? Why buy a membership at Sam's Club, Costco, or BJ's when you can walk into almost any other store for free? Answer is time, place, and value. When dealing with information we know that there are several categories, those being truths, half truths, lies, and statistics. The Nielsen Statistics are an attempt to discredit fee for content models in favor of existing ad generated revenue models. Twenty-seven thousand across fifty-two countries sounds so impressive but, there isn't much depth to these numbers. In fact, for so many countries to be involved, they're rather thin. What age group do these people belong? What associations are they affiliated with? How many Internet users are there? These numbers are hardly reflective of total Internet users. I'm sorry but Nielsen is making a very broad statement about consumer demand and pulling a number out of the air for nothing but a sound bite to support a statistical analysis of their claim. The industry has to come to grips with the fact that there isn't enough advertising to support every site's existence. The plethora of sites have weakened the penetration of advertising and diminished its value to both consumer and advertiser. The only way for sites to survive is through development of multiple revenue streams with a mix of subscription fee and sponsorship for professionally produced quality video with product placement in content. A website must be of service and value to its members and sponsors.

John Grono from GAP Research, February 17, 2010 at 12:25 p.m.

Interesting comment Ruth - "As with cable, an Internet access package should include the content."

I take it that when you buy a car, the petrol should be free forever? That is, GM, Ford et. al, should be giving away the oil companies product? The ISPs don't own the content to be able to give it away. An ISP is merely a channel to access the content.

Also, thank you to William drawing attention to the 'thiness' of the sample sizes in each of the countries surveyed. Given that Nielsen have reported at a 'global level' then the n=27,000 is valid, but caution to anyone who thinks that this means that the results apply to their own country.

Jonathan Mirow from BroadbandVideo, Inc., February 17, 2010 at 1:07 p.m.

Just another sorry chapter in the epic fail that is the US newspaper industry as they continue their death spiral into the new media graveyard. First they ignored the rise and importance of the web ("Computers will never replace ink on paper" - Newspaper executive to my face), then they soft-pedaled and underfunded their internet efforts while trying to duplicate extant sites thinking that if they offered a similar service they could own the industry (payment programs in particular) and finally they let a geek name Craig take away more than HALF or their revenue (classifieds - remember them?). So, of course the researchers who's income depend on this sort of gook will downplay the importance of this information, but here's the real facts (pay attention now, you've done a pretty crappy job in the past) - people will not pay for online newspapers. Here's a statistic: Newsday: 4 million spent, 35 pay readers gained. If you don't have the stones to admit failure, borrow some, strap them on and try something else. Corporate cowards and yesmen - the lot of them.

Barry Dennis from netweb/Omni, February 17, 2010 at 5:45 p.m.

Here's a link to a piece I wrote about Newspapers.
http://gomestic.com/consumer-information/pssst-newspapers-beat-cable-and-telephone-heres-the-deal/

If you believe the "Information Business Model" aka Newspapers, for one, has value, then transformation through "disruptive technology" is required. We have the tech, with more Convergence coming daily.
Newspapers need to become the Predator, not the Prey.