Brill Gets More Delusional: Now Thinks 10 to 15% Of Online Newspaper Readers Will Pay
from the good-luck-with-that dept
Earlier this summer, we noted that it was something of a pipedream by Stephen Brill to believe that 5 to 10% of online newspaper readers would pony up for a subscription to the online site. Having spent time looking at plenty of "free" websites that have tried to charge, the numbers are significantly lower in almost all cases. We're talking 1% tops -- unless there's a really really good reason to pay, and then you're talking 2 to 3%. In many cases, the number is even lower than 1%. At the same time, I pointed out that Brill was making the classic mistake that makes any venture capitalist laugh you out of the room: "if we just get x% of this market, we'll be huge!" But that's top-down thinking, and markets don't work that way. You need to be bottom up and explain not why x% will buy, but why the first person will buy, and the second person will buy and so on.However, as the Nieman Lab points out, not only is Brill still playing the top down game, he's now increasing the number of "paid" subs he thinks he can get from the "5 to 10%" he was claiming a couple months ago to "10 to 15%" now:
The idea is that a newspaper probably has 10 or 15 percent of its audience who are the most engaged, who come to that Web site all the time. Those are the people who will be asked to pay a small portion.They'll be asked, but they won't pay. Brill even tries to go through some numbers, but again, he does it top down, rather than bottom up:
Let's say that a newspaper in a given month has 1 million visitors. It might be that 850,000 of those people just came there casually through a Google News search, came there once or twice, but aren't particularly devoted to, let's say, The Washington Post.They'll be asked to pay... but will they? Fat chance. Now we run a website that has content that is viewed by over a million visitors per month (between RSS and the site itself). And, many of our readers are quite loyal and have certainly built a connection with the site. But I'll be the first to admit that the likelihood of 10 to 15% of our visitors agreeing to pay for the content is ludicrous. I'd argue that even thinking that 1% would pay is highly unlikely. There's too much "competition" for attention, and pissing people off with paywall doesn't make them more likely to stick around. Brill is way overestimating the willingness of online readers to pay for certain content.
On the other hand, there might 100,000 or 150,000 of those people who absolutely, positively have to see The Washington Post every day. They want to read your column. They want to read the stuff about lobbying.
They want to read the stuff that really makes The Washington Post The Washington Post.
Those people will be asked to pay something, typically getting a big discount if they already have a print subscription.
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Filed Under: journalism, newspapers, paywall, stephen brill
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Case in point...
Now what would have happened if this newspaper's paywall was never set up? I would have read the article and more than likely included it as a source for my paper. In the future I would visit the newspaper's site for more research, and more than likely news. I would recommend the site to others and the number of user's would grow; increasing the amount of add revenue they could ask for.
Really are the above concepts that hard to grasp?
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Re: Case in point...
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Strange reasoning
Hey. If I was a paying subscriber, I'd pretty much expect automatic access to the web site. After all, why would I pay extra to read the same news in a different format?
About the only advantage would be the timeliness of getting the news as it happens rather than waiting for the next day delivery. But still, for the average subscriber, that's not much of an advantage.
Certainly not enough to pay for.
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It's about price and convenience.
If a story is $0.001 to read , it's not the cost but the inconvenience that discourages people. I always stop at the NY Times (or whoever) "register for free to see this article" page because it is just a pain in the arse (not because of the cost), whereas if my "Paypal micropayment Firefox addon" toolbar/window popped up saying "This article costs $0.001 to read for the first time. 85% of people reading it who like the same things you like said it was worth the price" (or a briefer graphical version of the same) , and it would only take me 1 click to read the link, I'd probably go for it.
Of course, if it was $0.10 I probably wouldn't.
And herein lies the rub. Micropayment will fail not because it is a bad idea or because "people won't pay" but because the old media barons will get greedy and sink it by asking too much right off the bat.
They should hook us with "so cheap it is almost free" and take the long view.
Having convenient crowdsourced ratings for content would add sufficient value that we'd put up with the extra click, because in the long run it saves our precious time.
The turning point that matters is not when someone is able to say "we make a profit using a micropayment model" but when someone can say "we have micropayment [however paltry] yet we still have tons of traffic". Because prices can always creep up later.
The people who keep my history of content ratings can offer me a personalised news portal, of course, so the rewards for cornering that market are huge.
(BTW I can actually imagine Google doing an excellent job of brokering the prices for links in real time, such that they float according to the actual popularity, within some sort of agreed parameters, like a continuous forward and reverse auction. But can you imagine MS letting you put a google micropayment toolbar onto IE9 ? Hmmmm).
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Re: It's about price and convenience.
Some, but I'd argue not enough. Even at a tiny amount you've now added in mental friction: people ask if it's even worth that tiny amount. Plus, it makes it harder to share or discuss the news when there's a charge for every click, no matter how small or "invisible."
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Re: Re: It's about price and convenience.
Damn that Amazon one click patent! :-)
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Re: Re: It's about price and convenience.
Who cares if the charges are small and I "only" get extra charges of a dollar or two? The bottom line is that this adds uncertainty to my budget. For that reason I have phone plans that are fixed prices, even though I might save a few dollars if I never exceeded a more restricted plan.
Is it time to revive the phrase "nickel and dime someone to death"? What about "death by a thousand cuts"? (Only in this case, it is the inflicter who ultimately suffers because people who feel those little cuts tend to learn from them and move to more pleasant venues.)
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micropayment does not discourage sharing
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Re: It's about price and convenience.
You're claiming (in the same sentence) that you won't sign up for free for the NYT, but you would be willing to sign up for a micropayment system in order to pay to read? Because when it starts out, you won't have the Paypal micropayment addon. So you'll have to install that. Once you have that, some time you'll want to read something that uses Google Checkout Micropayments instead and you'll have to read the terms of service and install that in order to read those articles. And then later on you'll have to sign up for SuperPay, then PayItNow... you see my point. By the time they're standardized, the idea will be dead already.
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Re: Re: It's about price and convenience.
As you say, signing up for a micropayment scheme at the start is itself a hassle. If I needed many different ones to read all news sites it would as you say be a disaster. It would be better if someone designed a standard interface so that Paypal OR Google OR any other standard micropayment system worked with any compliant website.
(There are many different credit cards and many different vendors yet my one credit card allows me to buy things anywhere.)
If the micropayment scheme came as a browser toolbar (perhaps preloaded when I bought the PC) then it would just be case of entering billing details once.
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15% !? Tell 'im 'e's dreamin'
"The idea is that a newspaper probably has 10 or 15 percent of its audience who are the most engaged, who come to that Web site all the time. Those are the people who will be asked to pay a small portion. "
Of those who visit regularly what point do people not get asked to subscribe ? That's the level of involvement those users will then have.
Now then let's go the opposite way. I appreciate Mike recognising that frequenting a website does not mean you also want to pay to run it. Now then of all the sites I've visited while I've been using phone lines to get my PC to talk to another (and yes I started with a 300 baud modem), I reckon, there are TWO I have paid money towards. One was a social 8 line chatline (1988) which I was almost always on, and was in hardship so I helped out as did 2 other users. There were 400 users onsite - that means 3 people voluntarily contributed, out of 400, after an emotive plea for help from a FRIEND who ran a BBS. 3/400 = 0.0075, so 3/4 of 1/100th.
The other was a text based MUD game. It was really good, I really got into it. I found if I paid a bit extra I could buy additional skills. That was great. Until there were no more skills to buy, at which point I lost interest. The closest example I could give is cheating yourself god mode in your favourite game, then not enjoying it 'coz the achievement wasn't there. I found a good proportion of that was paid for by users. That said, there were about 8 admins on at any time, plus you had a suite of coders happily programming in some form of LPC, so I imagine the financial gain they got was chewed by overheads.
So that's two sites. I have 1200 separate domains in my bookmarks (excluding history) which goes from whenever Firefox 2 came out.
So in 21 years, with (at least) 1202 sites, I have contributed to 2.
I would respectfully suggest that most net savvy users would be similar. Ergo this guy's got it way wrong.
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Stephen Brill is Delusional
For eg - if Techdirt instituted a paywall; I would definitely not subscribe!
As you stated in your article - atleast 99% of the reading audience would support this notion, and not subscribe!
I enjoy reading your posts!
Look forward to them each am!
khyzhyj
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Just wondering...
But Techdirt does show how to make paid subscriptions work. All visitors get the same information, but paid members are given a feeling they're more special than others. You hear that, guys? I'm more special! I've paid! :-)
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Re: Just wondering...
:P
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Although we occasionally discuss ditching the landline, we like the redundancy in case of emergencies.
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Marginally Loyal
There is probably a reason those marginally loyal come to the site. Perhaps they are local. Perhaps they enjoy the political slant of the publication, or they have interests similar to those covered at the site. Their common interest makes those people the most valuable to advertisers. By definition, those are also people who visit the site a lot. So, the ultimate question that should be asked before erecting a paywall is, "How many of the marginally loyal will we drive away?" Those marginally loyal are far from worthless. They are quite likely the core of what the advertisers on that site are looking for. Bye-bye eyeballs. Bye-bye advertising revenue.
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I'm pretty sure the people that most frequent the site do so to avoid paying for the print edition. I know I read the paper online most days. If the washington post forced me to pay to read online, I never would.
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I'm not paying
I love newspapers; I read two to three every day on dead trees; I studied journalism in college.
Right now my only paid subscription is to the Chicago Tribune. If the Trib required me to pay *extra* for access to their website when I am already one of the dwindling few giving them a regular subscriber revenue stream, that would be the end of my subscription.
As much as I love features in the Trib, there are way too many similar options for free on the web. As much as I love several of the regular writers in the Trib, if they shut me off from those writers on the web, I know of many more I like I just don't have time to read right now. As much as I love to have paper in my hands on the train and in the coffeehouse, I have a printer at my PC to print out some puzzles - and my Blackberry news/RSS/games options are getting better all the time.
The one thing a full universe of paid newspaper subscriptions (if they can pull it off without some papers leaking) MIGHT do is drive me to buy a Kindle.
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Less Than Five Years Ago
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Why make us pay to read Tech Dirt?
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Idiots...
Their fatal flaw is believing we can't live without news. While true for some business folk, the VAST majority of us can happily live without so much as a peep from news.
And if they aren't going to syndicate their news with RSS feeds to other organizations, then their traffic will go down the tubes as well.
Good bye news media.
R.I.P.
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Re: Idiots...
No, their flaw is thinking we can't get it elsewhere.
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So, go ahead and put up your paywalls, Newspapers. I will sit back and laugh while you die.
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Not just delusional
"The idea is that a newspaper probably has 10 or 15 percent of its audience who are the most engaged, who come to that Web site all the time. Those are the people who will be asked to pay a small portion."
He is saying the other 85-90% wont be asked for cash. I think your top 10-15% will suddenly consider themselves in the majority group.
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Paying for subscription
I would think that the 25 cents you pay for a paper barely covers the cost of printing the paper and delivering it to your doorstep. The content itself is, I thought, covered by advertising.
So when distributing on the web, there is no ink-and-paper, and thus no printing and delivery costs. This leaves advertisement to pay for the content, as it always has.
True, Craigslist has probably taken a big bite out of classified advertisement revenues, but still, I wonder if classic advertising won't cover the cost of creating the content. Maybe someone can enlighten me on this.
I don't subscribe to online newspapers that charge a fee because I always believed (perhaps wrongfully so) that their printing and distribution cost is zero, and they still advertise, which should cover the cost of producing content. And yes, I occasionally do look at the ads, especially if they're local. Especially if they advertise discounts on a new set of tires I need for my car. :-)
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Re: Paying for subscription
I would think that the 25 cents you pay for a paper barely covers the cost of printing the paper and delivering it to your doorstep. The content itself is, I thought, covered by advertising.
Funny, it sounds to me like you're better prepared to run a news organization than anyone currently doing so.
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Except they don't want to actually do it, cause they know what will happen.
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Re:
As you no doubt deduced, if one holds out, that one wins. And they know it.
I think it was the Guardian that was cheerleading this effort while maintaining that they'll remain free.
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Curiosity
Just curious.
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