Never mind the content, feel the packaging

So, Rupert Murdoch has declared that News International sites will all start charging for content by next summer. What he actually said was he was satisfied that News International could produce “significant revenues from the sale of digital delivery of newspaper content”, that “we intend to charge for all our news websites” and “make our content better and differentiate it from other people”.

He hasn’t got where he is by announcing his plans in advance and I don’t think this announcement is an exception. It signals an intention but says nothing about the plans. He talks broadly – as most commentators also do – of “content”, when he fully understands the substantial differences between news, comment, reviews, features, serialised fiction, crosswords, recipes, agony aunt columns, … And what does “charge for a website” mean? He knows that clumsy, broad paywalls are a non-starter.

For any pay-to-view charging system to succeed it’s going to have to be sophisticated in its pricing and completely painless for the user. The overwhelming consensus is that no-one’s going to pay for news which is abundant elsewhere and not sufficiently differentiable. Some argue that comment and analysis have sufficient value, but the only proven cases are for business-critical content (Wall Street Journal and Financial Times). The only one sure way you’re going to get people to pay to view is to provide content that is either unique or otherwise unavailable for free elsewhere.

But there’s another way to differentiate your content – to create value – and that’s in the packaging.

Back in 2001 News International introduced charges for its crossword on Times Online, with a £10 annual fee; that’s now not just crosswords online but the Crossword Club, giving access to more than 9,000 puzzles and a host of member benefits – for £4.95 a month or £12.95 a year. That may be generating small beer for the Times, but it is based on just a tiny fraction of the the Times’ content. There are plenty more examples like this where news sites are already generating revenue from their content – but most commentators seem completely blind to them.

There’s no end to the number of packages, large and small, that news publishers could dream up, serving particular niches, and most will have a far higher perceived value than the simple online delivery of their base content.

3 thoughts on “Never mind the content, feel the packaging

  1. One area where I have seen paid-for content in action and working is in relation to product reviews. I have paid for a number of .pdf copies of sailing boat reviews from Practical Boat Owner and others when looking for information on second-hand boats – because they do contain information which is difficult to track down elsewhere unless you happen to have a back issue of the magazine around.

    Which? also seem to do this quite well with “premium reviews” which again I might consider paying for if I was in the market for the product in question.

    Whether news reporting as such can command this kind of premium value is a more difficult question, but the key is going to have to be in isolating, and charging for, these premium areas where people will pay (rather than paywalling your whole site!)

  2. I think there’s something here that law-firm’s should ponder, and the keyword is ‘create value’ (as you’ve identified in your post).

    Law firms hose free updates at clients, and law-firm websites are bloated with free client newsletters and briefings (what I’d call know-how updates). But law-firm clients often don’t get much value-added content – they’re stuck with the free stuff. And if they do ask for more tailored know-how updates (as they increasingly do) it’s often given a bit grudgingly…

    Seems to me that there is a bit of a client groundswell that free updates aren’t that great, and hat they want a better product (more value). But law firms have been slow to improve client updates — some firms have spots of client-only services, but they’re relatively rare.

    Maybe Rupert’s push for pay-content will harden the resolve of clients — they’re paying, so maybe they’ll demand a better know-how update service.

    Meanwhile, it seems amazing that more commentators on the pay-for-content story haven’t clocked that i-tunes has introduced a popular micro-payment model that the world is pretty comfortable with—

  3. An interesting article to stumble upon. Murdoch is often ahead of the curve on business ideas, so it should be interesting to see how this plays out. I do agree that the content is going to have to be substantially unique for it to be pay worthy.

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