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How publishers can monetise their online content

How publishers can monetise their online content

Neil Scoble, UK MD Hi-media assesses how publishers can best to monetise their content.

It was interesting to read UTalkMarketing’s recent article around readership figures following the re-launch of The Times’ site.

Almost two weeks since News International introduced a paywall around its newspaper site and already its market share has dropped by more than half. This will undoubtedly have a knock on effect in terms of eyeballs directed towards its site and it will be interesting how this move plays out in relation to the rest of the industry.

While the economic downturn had less of an effect on the online advertising world than other types of media, it is widely accepted that the industry needs to fight pressure to change pricing models.

The recent prolific growth of the internet has dramatically changed the way news is distributed, and where there was once a handful of news publications, there are now many thousands, including user-generated blogs and social media.

The jury is out on how high quality publishers now monetise and sustain rich content and there are a number of approaches that are being adopted to counter this challenge.

The News International approach

Readers of The Times are now charged a daily or weekly subscription fee to view a digital edition of the newspaper with little or no content available to non-subscribers.

Consumers used to having news freely available online will no doubt find it difficult to accept being charged for content, especially when a large portion of material similar to that published by the Times News Group can be sourced elsewhere.

A ‘search barrier’ has also been put in place so that its articles do not appear in search engine results when readers are looking to find articles on a particular news story or subject. This is a risky strategy and could backfire. If interested parties are not at least given the opportunity to view a portion of what the Times has to offer the News group is cutting off a potentially lucrative revenue stream.

Successful use of the paywall

The paywall is not something new however and has been profitable when the content behind it is highly specialised or personalised. The highly unique analysis and data behind The Financial Times’ paywall has been successfully charged for over the past few years.

The dilemma facing mainstream media with less exclusive content is that the Internet offers a simple and easy means for readers for find the information they are looking for from a variety of sources.

For instance, as a public organisation, the BBC has a duty to provide news to UK consumers and as this is funded from the Licence Fee, there is no extra charge. The issue then becomes simple; whether the content of premium publishers is sufficiently different to attract paying customers.

The odds appear to be stacked against News International, not least because a number of questions remain unanswered in terms of how consumers will respond and how advertising will be affected.

There are a number of areas which require additional research and only time will tell how the industry will respond.

For example, it remains unclear how much users are willing to pay to view news online and whether they will accept to pay at all in the long-term. Indeed, the lasting viability of paywalls should be a key concern for publishers.

If return on investment is based on monetising the most loyal readers, it will no doubt be more challenging to increase readership when non-subscribers have no means of engaging with content.

How will publishers monetise content?

There seems to be little evidence of consumers being willing to pay for generic news content they read online Eventhough the paywall decision will not have been taken lightly, Experian Hitwise’s figures that The Times website saw a drop in daily market share from 4.37% to 1.81% in May will not have made for easy reading.  

While the Financial Times has a justifiable reason for content to purchase their content, it remains to be seen whether The Times will be able to attract a similar level of interest in their subscription based model.

Publishers may not need to take such an all or nothing approach to the problem. A more intelligent strategy can be adopted where payment model is used exclusively for more unique or personalised material, with online advertising used to support broad content like news and sport.

This helps free remain free and offers richer content for a fee for those who require it.

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