Magazine article Editor & Publisher

Your News Content Is Worth Zero to Digital Consumers

Magazine article Editor & Publisher

Your News Content Is Worth Zero to Digital Consumers

Article excerpt

OK, yes -- that headline was meant to grab your attention. I don't mean to suggest that ALL news content published online or on mobile devices is worth nothing; a small slice of unique, niche news content can get some people to pay money for it.

But MOST digital news content, I am going to suggest to you, has no monetary value to readers or viewers. Sure, it has value for advertisers, who will pay to get in front of the audience assembled to consume the content. They'll pay extra if you can assemble an audience of similar readers (e.g., cancer patients reading about new research, and a drug company advertising on that Web page).

But consumers paying for news stories online, or on mobile phones, via micro-payments or subscriptions? Not likely. (Bundles? ... Maybe.)

My apps epiphanyI've been a proponent of the idea that non-niche news content is better off being free, supported by advertising and other revenue streams, for some time. The other night, at a meeting of the Rocky Mountain Internet Users Group in Boulder, Colorado, I sat in the audience as two local mobile gurus -- Joe Pezzillo of and Kevin Cawley, director of mobile applications for Newsgator -- mused about how far mobile devices have come, and what to expect in the future.

What both guys agreed on -- and they disagreed on quite a lot of other things -- is that the mobile market is huge, growing fast, and evolving rapidly. For news publishers, mobile represents big-time opportunity, especially for phone applications.

As Pezzillo, an Internet pioneer who more than a decade ago was creative director of the Apple Electronic Media Lab when it was based in Boulder, talked about the success of the iPhone, I asked him his thoughts on how content publishers might make money from content on mobile devices that's different than on the desktop/laptop Web.

The crux of his answer: "People love apps." (He said a lot more, but those were his most important words of the evening, at least for me.)

Just with the iPhone alone (30 million sold in two years), Apple CEO Steve Jobs boasted last week that 1.8 billion apps had been downloaded. An estimated 13% of the apps downloaded carry a price tag (source: Pinch Media, February 2009; the figure is probably higher today). What started out in the iTunes Apps Store as mostly free apps has evolved: first into a lot of freemium apps (scaled-back free version and a premium version for 99 cents or $1.99); then into a growing number of paid apps with no free version; then prices for paid apps slowing getting higher. (If you watch the slide show on the Pinch Media link you'll understand why phone app advertising is much less desirable to app developers than putting a price tag on their apps.)

So, Pezzillo's simple observation about the success of phone apps points to an important truism about human consumer behavior: Most people seem to prefer to spend money on things they get to "keep." A phone app may not be a physical thing, but it's there on your phone every time you turn it on. It's "yours," even though it's just digital bits.

Think about the newspaper industry's troubles adapting to making money online. For years, publishers had no trouble selling a physical product, the printed paper, containing a package of assorted news, advertising and other stuff. The readers bought a physical object that they got to keep and later throw away or recycle.

But then, along came the Web and many news consumers changed their preference to online (and increasingly mobile, too). Newspaper publishers tried off and on over the years to charge consumers for access to their news content online with subscription fees, but time after time it failed -- from Mercury Center to TimesSelect (The New York Times, 2005-2007).

Why did they fail? There are many reasons, of course, but I believe that perhaps the biggest reason is that when online news consumers were asked to pay for news, many felt that they weren't getting anything, because they received nothing tangible -- just information. …

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