Pay doesn’t work

Yeah, yeah, yeah, the Wall Street Journal and iTunes. But once you list a handful of exceptions, it’s just true that paying for content doesn’t work online. And there’s one fewer exception in July: CNN is abandoning its effort — its second effort — to charge for video online. In a distributed media environment — where you will want your content nuggetized and widgeted and available everywhere — it will be even less practical and possible to charge. (Hat tip: Steve Gorelick)

  • http://deleted Tansley – addendum

    Amazingly fast response on their part. They must have some younger staffers on the payroll (Uh….hate to be a killjoy, guys…but, um, this just isn’t gonna WORK, yaKNOW?…..)

  • http://www.pardonthedisruption.com Chip Griffin

    I don’t think the problem is that pay doesn’t work, the problem is that people will directly pay only for that which is indispensable content. If they can’t get it elsewhere for free and they need/really want it, then they’ll pay.

    People pay for access to out of town baseball game video, the WSJ, iTunes, financial research, and others because there’s no alternative. But you can’t charge for access to a commodity product.

    Bottom line: unique, valuable content can carry a direct charge.

  • http://jonathanpotts.blogspot.com Jonathan Potts

    The Wall Street Journal is a bit of an exception as well because I think a lot of people read it through their employers’ subscription.

  • http://www.chapellassociates.com Alan Chapell

    Why doesn’t this rule apply in the wireless space? Is it that mobile devices enable micro-payments…. or is it that the wireless carriers just don’t understand the ad biz?

  • Steve

    This is actually the first moment that I have ever asked myself: What on-line content would I pay for? Even more to the point, what have I paid for?

    And, at the risk of sounding like a commercial, there really is only one thing I have ever paid for. And that is Times Select. 1) Enough of the premium content is truly premium. 2) The Times Reader is an incredible tool that allows me to download the entire paper and take it with me and read off-line. And access to the archives is very useful.

    I have never paid for anything else, including you know what, which is also abundantly available without charge.

    Another quick personal story about free content. My hours are so irregular that I virtually never have time to sit in front of a television. But I happened upon the free episodes of 30 Rock on the NBC web site, and a fan was born. And as far as the ads go, let’s just say that the NBC web site isn’t forcing me to watch anything close to the number of ads that I would tolerate to see that show and luxuriate in the virtual presence of the gorgeous, enchanting, hilarious Tina Fey. If it hadn’t been free, I wouldn’t have watched it. Period.

    Finally, another example. I have always adored Ira Glass’s “This American Life” on NPR. And, while it was always possible to stream free episodes, only in the last year could you rip an MP3 of the current week’s episode and keep it. I wondered about this one: What business model was in effect?

    And then “This American Life” went to cable TV. And while I still don’t know about the business plan, I now see that all the free content on the wonderful “This American Life” web site had all along, among other things, been promotion and word of mouth for a much bigger delayed pay day.

    And that is the lesson of Pipeline: The pay days are still there to be had, but they will not look anything like the pay days of old. Indeed, my hunch is that one model will be to use one medium to promote with unlimited free content in anticipation of a larger pay day in another medium once the content has become indispensable.

    Some of the network guys just seem to viscerally hate the money they spend and don’t immediately recoup in web-based incubators. So they seek a quick pay-day. And then wonder why no one is buying. They seem not to understand how dispensable their product always was!

    I hate the analogy, and I know it isn’t original, but think of the old stereotype of the heroin dealer depicted in all those old 1950s and 1960s educational films. He hooks you at low or no cost, makes himself indispensable, and then gets his pay day.

    There was simply not one good reason under the sun — NOT ONE — that Pipeline was even slightly indispensable.

    So there you are: You want a pay day? Bring on the heroin model!

  • http://ari.typepad.com Steve Rhodes

    The reason Pipeline didn’t work is it sucked. It really sucked.

    http://ari.typepad.com/tiger/2005/12/cnns_pipeline_i.html

    Yes, it was nice to be able to see CNN International in the wee hours and the occasional interesting breaking story.

    But they didn’t offer their best programs I guess because of stupid legacy agreements with their cable operators (who don’t realize very few people would cancel their cable because they could get CNN shows on Pipleline or online).

    And no full programs on demand. No library of their documentaries over the years or of important stories that could give some background to current stories.

    You can actually now get a few CNN shows via video podcast like Reliable Sources (which would be fine as an audio podcast) and Wolf Blitzer’s Sunday show. They’ve finally started an Anderson Cooper 360 podcast (though it is only 20 minutes).

    There will be a DVD of the first season of This American Life (hopefully with lots of extras) and they may make episodes available for $2 on itunes (though they should have done it each week when it was running).

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