
Few things in life are certain. Death, taxes and...free online content?
In the beginning was the Internet, and it was good and it was free (and if not, people just ripped it and made it available on a P2P network).
And then to spoil the party, more sites came along with content which was either partially or exclusively paid, such as the Wall Street Journal, the Financial Times, the New York Times, CNN and salon.com.
Over time, many of these organizations eased their restrictions on paid content, with FT cutting almost all of its paid content, and WSJ now allowing a significant amount of content to be made available online. The fairly straightforward theory behind this was that people recognized and appreciated the quality content and would keep visiting the sites, and that the increased page views could translate to higher ad rates, offsetting the subscription fees lost. For example for the New York Times, page views went up 80% after paid subscriptions were dropped.
All of that seemed fairly straightforward, and also translated quite nicely into the offline world. When I was living in London back in 1998-2001, the Tube was always littered with copies of the free Metro, which although not exactly Pulitzer Prize-winning journalism, provided a good morning read while trying to avoid your face making contact with some strap-hanger’s armpit. Again, it was distributed so widely that it attracted premium ad rates.
Similarly, the free USA Today that was shoved under my door at hotels across the country nicely boosted its circulation, increasing ad rates quite nicely (in fact almost 50% of its distribution was free, through hotels, car rental agencies, etc).
But then the bad times hit. One the one hand, advertisers could no longer afford the high-priced insertions. One the other, hard-pressed companies needed to trim fat from their bottom lines by cutting out items such as free daily newspapers. Marriott cut free copies of USA Today in early 2009, reducing its circulation by a full 7%. Today, Rupert Murdoch’s News Corp announced it was closing down its free London Paper (cunningly called thelondonpaper), one of three free daily papers in the UK’s capital.
This decision falls hot on the heels earlier this month that News Corp will start charging for access to digital content across its stable of publications around the world, from the Journal, to the illustrious New York Post and its esteemed sister paper, The Sun.
But the question is, who will pay for it? While premium business-oriented content can still command serious subscription revenues – after all, it’s mainly paid for by corporate accounts, I would imagine – would someone really want to shell out for gossip and scandal that can be found online on myriad other sites, blogs and so on?
On top of this, as a culture in general, have we not all got so accustomed to consuming free stuff (from Hulu to Pandora and beyond) that the idea of paying for online content has become so alien that it would dismissed out of hand? It will be interesting to see how well Murdoch can pull this off, and if he can, who will be the next on the bandwagon. After all, we all thought he was crazy paying half a billion dollars for a money-losing Web site, but that seemed to work out quite nicely.