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Ask many consumers why they've stopped purchasing dead tree publications like newspapers, and chances are you'll hear comments like "the cost is too high."
Ask those same consumers what they expect when it comes to the digital/tablet versions of their newspapers of choice, and you'll probably learn that they expect the cost to be lower. And for good reason: there's no paper and ink to buy; the marginal cost of selling an issue of a newspaper on an iPad is pretty close to $0.
The Financial Times is one of the few major print publishers that has succeeded in a big way with paid content. And while other print publishers who hoped that the iPad would help them revitalize their businesses struggle with the iPad, the FT looks like it has extended its existing success to the platform.
According to The Guardian, the FT's iPad app has now produced more than £1m in ad revenue since it was released to the public in May. What's more: of the 400,000 people who have downloaded the app, a decent number are subscribing; the iPad app now delivers 10% of the FT's new digital subscribers.
Prior to the launch of the iPad, many magazine publishers hoped that the iPad might do for them what the iPod and iTunes did for digital music: provided a viable marketplace for them to sell their wares. Operative word: sell.
Getting consumers to pay for content has, of course, proven challenging for many magazine publishers. And despite the warm reception the iPad has received from consumers, it hasn't exactly meant overnight success for publishers that have rushed to develop iPad versions of their magazines.
Despite the fact that many publishers have struggled to transform ad-supported content into profit, many publishers have opted to keep the ad-supported content, and forgo a paywall.
And there's a good reason why: it's entirely unclear to many publishers whether a paywall will be profitable or not, and once a paywall goes up, a publisher's audience will almost certainly drop. For many publishers, ad-supported content and a large audience is still more attractive than paid content and a smaller audience.
Is paid content the online future of the newspaper business? While there's plenty of discussion and debate on the subject, if you listen to enough newspaper executives, you might come away with the impression that they think it has to be.
But while many newspapers contemplate paid content and talk up their plans, The Financial Times has actually been executing a paid content strategy.
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.
Pierre Omidyar launched eBay before many of us were online, and before online shopping was a multi-billion dollar a year market. But blazing the trail of ecommerce may prove to be a much easier task for Omidyar than building paid online news properties.
Yesterday, the Omidyar launched the Honolulu Civil Beat, an online news publication designed to provide content and facilitate conversation around "the important issues facing Hawaii."
The Financial Times is lucky. It's in the minority of newspapers that can legitimately claim to have found 'success' with an internet pay wall. The company's subscribers pay upwards of $180 a year to access content on the Financial Times' website, FT.com, which is behind one of the more solid pay walls around.
But that pay wall isn't impervious; it may be coming down if you're a certain type of mobile internet user in certain geographic regions. That's because, according to Business Insider, the Financial Times will soon launch an initiative with Foursquare that will give some Foursquare users who check into certain businesses in certain locations the ability to access FT.com without a paid subscription.
News Corp. and Hulu have been talking a lot about ways they could charge for Hulu content of late. But two months into 2010, we have little word on how that will come to fruition (except a rumor that iPad users will have to pay to watch Hulu). Well, video upstart Boxee has a few ideas.
Last month the digital video provider announced plans to charge for its content. And today, Beet.TV has a video of Boxee CEO Avner Ronen explaining some of the details.
If anything, maybe this could help Hulu open up and let Boxee have access to its video again.
Reports have surfaced indicating that, after much internal discussion and debate, the New York Times is ready to announce its much talked-about subscription model.
According to sources who spoke with New York Magazine, the NYT has settled on a metered model under which NYT online content will remain free but after a certain number of views, users will be prompted to subscribe for further access.
There has been a lot of talk about publishing business models related to paid content. We understand this space pretty well, given that Econsultancy has been operating a ‘freemium’ model successfully for over 10 years now.
But rather than talk about our business model, I wanted to give five tips from my own experience on what I believe is important, and what works, in order to be successful at selling content online.
2010 is here. Plenty have made specific predictions about what you can expect this year. Predictions are fun, but sometimes knowing which markets to look at is a better approach.
With that in mind, here are five of the markets you might want to track in 2010.