Commentary

Publishers Can Take A Lesson From YouTube

Print subscriptions and paywalls have seen a groundswell in the past few years as publishers seek to replace ad revenue lost to social media and internet search. The industry needs to take a lesson from Google’s YouTube on the future of making money from ad insertions in text and multimedia content.

Making viewers pay for content is a positive development for publishers amid a broader trend of giving audiences more control over what they buy. 

For example, the pay-TV model of the cable and satellite industry is breaking down as consumers cancel bloated packages of programming. Instead, they pay for broadband internet and sign up for streaming services Netflix, Hulu and Amazon Prime. Disney plans to get into the game this year with an over-the-top entertainment service, following the rollout of ESPN+ in 2018.

Publishers shouldn’t be the only companies expected to give away their content for free, although many consumers have been trained to expect unfettered access to the online versions of magazines and newspapers.

Facebook and Google have become powerful gatekeepers to online news and information, while draining away revenue from publishers.

The coming rollout of high-speed 5G mobile networks will open the digital floodgates for content even wider. Publishers have the possibility to deliver video ads to readers — even amid their traditional offerings of text and still images.

Such intrusiveness may annoy the hell out of people, but Google’s YouTube inserts skippable, non-skippable and bumper video ads into videos. Viewers who don’t want to watch six-second ads can pay for the ad-free version of YouTube.

Its YouTube Premium service charges $11.99 a month, which includes access to its music streaming service YouTube Music Premium. Among on-demand entertainment providers, it’s less expensive than combining subscriptions to the video and music services, such as pairing Netflix with Spotify.

That’s where exclusive content makes all the difference. I could cancel my Netflix subscription and politely explain to my kids  they can’t see favorite shows like “Stranger Things” or “Fuller House” any longer. I also could lock them in a darkened closet for hours and inflict the same kind of emotional trauma.

Exclusive content is the heart of Netflix’s value proposition to viewers, especially as film and TV studios bypass the company to reach viewers with their own streaming platforms. Many will charge a subscription fee for ad-free service.

The transition to paid subscriptions can be rocky, as Harvard's Nieman Lab illustrates this week with a story about Arkansas Life magazine. Its experience is emblematic of struggles that many publishers face. 

The next couple of years will decide much of the direction for the publishing industry. As the font for many new ideas and exclusive narratives, publishers can be well positioned to profit from their creative work. They shouldn’t be afraid to make people pay for it.

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