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It's common wisdom that the long, painful decline of newspaper business models began as the internet blossomed.
The internet is blamed for just about everything, from declining print subscription revenue to freefalling classified ad revenue. But is the common wisdom about the internet and newspapers wrong?
For many internet startups, a freemium business model is an enticing solution to the problem of revenue generation: let the world taste what you provide at no cost, and once your most avid users are hooked, let them pay for what they've come to love.
It's simple in theory, but for many startups, building a viable business on the freemium model never becomes a reality.
One of the most difficult things for a company to pull off successfully is a price increase. And for good reason: most people don't like paying more for something they're currently purchasing for less.
The difficulty you might face in raising your prices and retaining satisfied customers, however, is not justification for not raising prices. Sometimes it's necessary, and sometimes it's more than deserved.
Raising prices and surviving to tell about it requires tact. Pricing may largely be a function of supply and demand, but purchasing decisions are often based on subjective factors that a price increase can negatively affect.
When it comes to desktop software and web-based applications, consumers are used to shelling out money for additional features. There are multiple versions of software packages, for instance, and many paid web services offer different features at different prices.
It's a model that might soon be coming to the hardware market. Over the weekend, news broke that Intel has begun selling computers equipped with its Pentium G6951 processor with a $50 "processor performance upgrade" card. As the name implies, the card enables the owner of a computer with a Pentium G6951 processor to "upgrade" the capabilities of the processor, for a price.
The newspaper business may be old and stodgy, but it's quite evident that its future depends on embracing the internet. And internet technologies.
One of those technologies: web analytics. Yesterday, The New York Times detailed how newspapers, once leery of web analytics, is increasingly taking a second look, recognizing that the real-time consumption data web analytics can provide is too valuable to ignore.
If you list some of the most popular and important companies on the internet today, you'll notice that most have one thing in common: they offer an API. And, in most cases, for good reason. APIs can be a valuable asset for an internet business.
But is an API a business development asset, and over time, should it cannibalize business development?
Starting a new business is a positive action, and in my experience most entrepreneurs are positive people. But sometimes that positivity can mask harsh realities that many entrepreneurs would rather ignore, and can lead them to buy into ideas that are detrimental to success.
Here are ten dangerous ideas that many startup entrepreneurs buy into that they shouldn't.
It's no secret that social media and a subscription business model doesn't exactly go hand and hand. There's a reason that the world's most popular social media websites are free to use.
But just how difficult would it be for a company like Twitter to charge its users? According to the 2010 USC Annenberg Digital Future Study (PDF), zero percent of users polled indicated that they'd be willing to pay for Twitter. That makes finding a way for newspapers to charge for their websites look like a walk in the park.
Making money online isn't always easy, especially when you run an ad-supported business. And that's not just true for the small fries; it can be even more true for popular, heavily-trafficked sites.
That's the case for Reddit, the popular user-generated news site. It was purchased by Conde Nast Digital in 2006, but a blog post last Friday indicates that all is not well at Reddit.
When the New York Times tried to have Apple pull the plug on the hit iPad news reader, Pulse, I noted that as newspapers like the New York Times attempt to 'save' their businesses, it would be wise of them to figure out how they can work with creative third parties. After all, individuals outside of these organizations may be able to do more for them in some areas than they can currently do for themselves.
But if emails between an online publisher who wanted to license content from Dow Jones is any indication, news organizations may be better at talking about getting paid for their content than they are at actually accepting money from businesses that are ready to pay them.
As Twitter makes the transition from profitless startup to revenue-generating business, the massive number of links that are shared on its service on a daily basis represent valuable currency. Given this, Twitter naturally wants to exert more control of those links.
Journalism, apparently, is in trouble. The once-dominant financiers of journalism -- newspapers -- are dying. And while some see hope in new media, the harsh reality is that journalism's woes have less to do with distribution mediums and more to do with business models.
That's because the kind of journalism that is threatened is expensive, and even online, there aren't too many business models that can support it. So what should we do?