Micropayments and digital media haven’t exactly enjoyed a happy relationship so far, and this is a bit of a travesty according to Greg Golebiewski.

Who is Golebiewski? You might not be surprised to learn he is the CEO of a micropayment provider, Znak It. So his argument is a little self-serving, but still valuable. In the age of newspaper paywalls, Golebiewski  tells Paid Content newspaper publishers are missing a trick with not using micropayments to, say, offer a single article for a few pence to entice new readers. One of the schools of thought around paywalls is they’re not half bad for monetising online readers, but sub-par when it comes to growing a reader/subscriber base.  

Says Golebiewski, “it’s extremely difficult to break that notion, the theory that micropayments don’t sell. [Critics] don’t have any data… it’s very difficult to go to them and say we have a flexible system for payments and then when they figure out it’s micropayments, they stop listening.”

Speaking of data, Znak It has some to back-up the CEO’s enthusiasm for micropayments. The company ran five pilot projects to see how many participants would buy a range of digital content; videos, music and written. Some 1,281 “buyers” emerged from a total of 43,000 unique users. According to Paid Content, “as many as 5 percent of the unique users wound up becoming buyers (paywalls usually get about one percent conversion).”

So what’s going to get micropayments into the mainstream? Google/YouTube might be the answer. Stick with me.

Google’s online video behemoth has been linked to the idea of a subscription model service, supplementing the traditional ad-revenues, for quite some time. Fresh rumours emerged in this weekend’s FT, with a report declaring “Google is on the verge of unveiling an à la carte subscription service for some of YouTube’s specialist video channels” (alternative info here for those sans an FT sub). 

“A la carte subscription service” is a little vague, as rumours tend to be, but the article goes on to say users could subscribe to channels “as little as $1.99 a month”. I guess that’s a la carte in the sense you pick a channel to subscribe to, rather than ‘subscribing to YouTube’. Whatever the specifics, this isn’t a million miles away from a micropayments system. True you’ll be subscribing to an entire channel rather than a single video, but chances are it’s a single video that will be the trigger to purchase in the first place – so not so far from buying one newspaper article through micropayment. The relatively low cost is another similarity.

The new system, combined with the prevalence of YouTube, could bring the concept of micropayments to a mass user base. It’s simplistic thinking, but it’s a start – and not the first time a big technology company has kick-started a digital content payment trend. How many people would have spent a few quid on a small software program for their mobile in 2006?

It could happen. Bit ironic potentially too - if Google ends up helping newspaper publishers develop a revenue stream from micropayments, after the ‘evil’ Internet got them into this fine mess in the first place.

The Financial Times has been held up as something of a pioneering newspaper, but its latest digital expansion comes at cost to the print.

The paper has done a good job of adapting to the digital world, attracting large numbers of paying subscribers to both print and online. It’s usually the default pro-paywall example; although with the note its content has the advantage of being unique enough to attract paying readers.

Long standing editor Lionel Barber announced on Monday a renewed focus on digital, and is hiring 10 new employees specifically under a digital remit. The knock-on effect is 35 current FT staffers face the chop – or more accurately being offered a ‘buyout’ according to Paid Content. 35 of these buyouts will save the paper £1.6m this year, according to an internal email sent yesterday.

Barber says “The intention is to reduce the cost of producing the newspaper and give us the flexibility to invest more online”. There’s also a mandate to focus more on “priority stories”, an streamlined international presence and new products in the coming year.

Interestingly, Barber sees less competition with rival papers and more with social media channels, “Our common cause is to secure the FT’s future in an increasingly competitive market, where old titles are being routinely disrupted by new entrants such as Google and LinkedIn and Twitter.” 

On the surface it may look like hard number crunching (+10 -35 isn’t tough maths), but these are the hard calls publishers and editors are being forced to make in the digital world. Ultimately is does mean we’re looking at smaller editorial teams, but it also means more focused teams delivering the content readers want to consume and pay for. What Mr Spock might have called ‘the needs of the many’. Although there’s no way around the fact it’s tough times for the 35 potential buyouters. 

At the sometime Barber was tapping out his email, Andrew Miller, CEO of Guardian Media, has reaffirmed the group’s commitment to “open journalism” and shunning of the paywall model. Miller is one who has argued the FT’s paywall works because subscribers were always willing to pay for the premium business and financial content - something his paper can’t match. In an article with The Economist last week, he wrote:    

 “The overriding business task is to monetize the online audience…when we talk of ‘audience’ we still mean our readers…newspapers have always used a blend of different funding mechanisms to extract revenues for their ‘product’. That’s why I am unconvinced by those who say that the only model that works is to build paywalls. This is not an area where one size fits all.

“In some news organisations where growth in readership may not be so important and in particular where there is a strong existing print subscriber base to build on, a pure paywall may make excellent business sense. The Economist and perhaps the Times spring to mind here. It also makes sense in other publications which feature business-critical information – for example, the Financial Times and, in the Australian context, the AFR.”  

In short, the FT et al can afford to monetise content and focus on digital because they don’t have to worry about growing their readership – but The Guardian does.

So where The Guardian is competing with paid-for titles and grabbing readers wherever it can, even in Australia now, the FT is more concerned about monitising content and developing a profitable digital business. The idea of “open journalism” is a noble one, and one I hope works out in the long term. But for now, it seems making the tough calls is the better option for newspapers looking for a firm foothold in digital.

Paid-for news content is having a tough old time in the Internet age. Us readers are so used to getting news for free that even the lowest cost news and online content is shunned in favour of free site. According to two separate reports, from Forrester and the Columbia/Indiana University, there are two lifelines for news content – the rise of tablets and smartphones and…umm…’love’.

Easy one first. Analyst house Forrester has released its predictions for potential grown in the paid content market in the coming years. It’s being driven by the increasing number of smartphones and tablets out there. The firm predicts the market for music, games, film, TV and news content will grow by 65% by 2017 – bringing it to a total of £8bn. ‘Digital news’ specifically is expected to shoot up to almost £250m, a 77% increase in spending from us consumers.

Which all sounds like good news for those news outlets with paywalls erected around their content – the FT, The Times and New York Times and so on.

Forrester states the change will be driven by the appeal of new services available on cutting edge tech, although how this relates to news specifically isn’t clear. Forrester’s own Darika Ahrens says “Demand among European Internet users willing to pay for digital content grew between 2009 and 2010, but the number of online buyers didn’t due to a lack of compelling service offerings.”

So we need some more compelling services. And also a bit of ‘love’. That’s according to a study from  Columbia/Indiana University titled ‘Paying for What Was Free: Lessons from the New York Times Paywall’. 

As the name suggests, the study examined New York Times reader habits and motivations for paying for the paper’s content post-paywall. The 954 participants were shown two “justification paragraphs” that explained why the New York Times had opted for a paywall model.

One focused on the publisher making a profile from editorial, while the other emphasised the charge was needed to avoid the paper going out of business. The respondents were then asked to rate “how the information changed their support for the paywall and their willingness to pay”. By far and away, they were more likely to pay when facing up to the prospect of the paper closing.  Sadly, according to Paid Content, guilt is “not a guaranteed way to get readers to pay”, as most readers chose not to pay at all, regardless of the statement they read.

There are a few bright spots in the paid content space, but it’s a long slog toward a healthy, stable and profitable market. Love and smartphones are not enough.

The Reuters Institute Digital News Report has revealed there’s something of a mix future for online news journalism and paid content.

Three-quarters of Brits read news everyday – which is low

According to the survey findings, based on a poll of 6,000 people from the UK, US, Germany, France and Denmark (so when I say ‘rest of the world’ that’s sort of not at all true), around three quarters of us Brits access news every day. ‘Access news’ meaning either watching TV, listening to radio, reading it online or in good old fashioned inky finger newspapers.  

Not a bad stat, but compared to the Germans we’re lagging behind. 90% of our Deutschland friends are accessing news on a daily basis. We’re also lagging behind the Denmark, the US and France.

Source: Reuters, via BBC News Online

Celebs vs politicians

But maybe it’s about the quality of news read, rather than quantity? Actually, no.

According to the BBC’s abridged reporting of the survey, us Brits are far more into celeb news (that is gossip, film and music) than political news. 21% of readers in the UK are hungry for celeb-centric stories, compared to 16% in the US, 14% in France and Germany and a miniscule 9% in Denmark (although to be far, I can’t name a Danish celeb).

The BBC attributes (blames) this on sites like Mail Online, Holy Moly and Female First.

In comparison, 37% of UK readers were interested in political news. This sounds good, until you compared it to the US’s 63%.         

Future is bright for online journalism and the social media savvy

The upside to this, from the future of journalism perspective, is UK users are more likely to find news online than anywhere else – 82% of those snap-shotted in the survey had read online news in the last week.

More good news for online comes in the social media usage and discovery stats. On average, 20% of readers are now likely to find a story through social media sites (Facebook and Twitter named specifically). For younger readers, those tweet posting / status updating whipper-snappers, this goes up to a whopping 43%. More exciting still, social media collectively surpasses search engines as a source – take that Google News.

Mixed results for paid content

Sadly, one of the lowest numbers in the entire report is the percentage of UK readers willing to pay for news online: just 4%. It’s not much better elsewhere, the highest figure came from Denmark and barely broke into double figures at 12%.

Its better news for those who’ve looked into a tablet app as well as a website – 21% of tablet owners have paid for news. As always this is always a slightly skewed statistic. Tablet owners tend to be at the upper end of the affluent scale, so have more dosh to splash on digital content. I’m not sure Mail Online readers will be queuing up to pay for a tablet app ticker of celebs posing at the Wimbledon final. Never say never though. 

So while there’s money to be made and online eyeballs to be grabbed, the ball is still in the media innovators’ corner to secure the future value of news journalism. The full report can be read for free online here.

@simonhill

There’s a brand new Tumblr page kicking about the web this week, and it is a little different to school days nostalgia, inappropriately placed QR codes or a love of charts and Venn diagrams.

A select few of the The Times newspaper’s editorial team have taken to Tumblr and are publishing blog posts, opinion pieces and picture stories. Since coming online yesterday posts have covered a range of topics including gay marriage, protests against Russian President Putin and a gloomy insight into the state of the British summer.    

But you may be thinking ‘hang on a minute, what about The Times’ paywall? Isn’t giving away content from some of their top writers flying in the face of the paid content model?’. And you wouldn’t be alone in these thoughts.

Hugo Rifkind seems to be answering similar questions on Twitter. Firstly, lets clarify this is not The Times attempting a freemium model, it’s ‘different’:

The driving force behind it seems to be allowing Times reports to provide content and opinion to readers at increased speed to the print and online site, cutting it from a day to “about 5 mins”:

Or, if you prefer, think of it as Twitter+

In fact, that seems like the best way to sum it up. The Times has a less straightforward social media play to non-paywall papers and online news sources – being behind a paywall means sharing content and engaging with readers has to be re-thought.

Direct engagement with content and Times reporters is limited to subscribers and buyers only, so posting on Tumblr is potentially a good way to give some insight into editorial coverage and tempt new readers within the Times’ paywall. It’s not the only paper experimenting with Tumblr, check out the Guardian’s Untangling the Web for another, but it does show The Times isn’t 100% closed to the idea of free content online.

@simonhill

Thanks for the tip @kchadda

The Times’ paywall was the first to go up on a UK paper, and since being in place has fallen over on the odd occasions – seemingly by mistake. That was until the Queen had been on the throne for 60 years.

During the Jubilee weekend, a time when the majority of the British public chose to watch the Diamond Jubilee celebrations from the comfort and warmth of their own homes, someone at The Times though it was a good time to drop the paywall. This was an effort to attract un-paying eyeballs and, hopefully, generate a few more paying subscribers.

And it sort of worked. Some 6,000 people registered for The Times or Sunday Times sites over thw weekend according to Media Week. These 6,000 will now be hit up by marketing in an effort to boost subscription numbers. 

Bosses at The Times must have been pleased with this number, as the paper is now planning to drop the paywall again during the London 2012 Olympics – presumably thinking the same target audience that was glued to their TV will be stuck in offices during the games and sneaking a look online whenever they can.  However, the paywall will only be down for two or three days during the games, likely around the more prominent events.

Does this mean the paywall model will change following the Olympics, as some suggest? Probably not. As an early foray into the world of paid content it seems to have gone okay. Using increased interest in mass appeal events is more of a marketing evolution than it is a revolution in business model. It’s more likely we’ll see the paywall drop temporally in future around similar scale events – provided there is a consistent small boost in subscriber numbers when it does.

It’s not bad timing by the paper for another reason. A number of London tube stations are being fitted with Wifi in advance of the games, which will be free initially. The first stations are already online at King’s Cross and Warren Street. So those heading to the games, as well as London commuters, may stumble through the paywall in their pre-event browsing.

@simonhill

I say ‘launches’, they’d added a ‘Europe’ link to the nav bar. But this is more than a link.

It’s probably not escaped your notice GigaOM has been upping it’s not-US presence. In addition to appointing ex-Guardian tech staffer Bobbie Johnson as European editor, the site has also nabbed PaidContent and associated sites from the Guardian Media Group (see a pattern here) to strengthen its coverage areas and international reach.  

Why is this? To be blunt, Europe is different to the US. We have different laws and governance covering lovely things like data protection, file sharing and copyright of digital content, social media, privacy and lots of other technical what-nots that are in a near constant state of change. We’ve also got a whole host of companies based in the Europe – and have had for some time now. Last.fm, for example, kicked into life in East London. Plus, there’s a whole VC and financing sector operating in complete separation of the Mecca that we Brits like to believe Silicon Valley is. Oh, and the time is different over here too.

In short, you’d struggle to cover it all from the states. Or, to quote the site itself “Ultimately, we believe that not only is there an under-covered base of businesses in Europe, but there is also a new generation of international start-ups and digital companies being built here — and that the changes happening as a result of this shift deserve the kind of attention we can give it.”

So there is it – GigaOM Europe. Start reading.     

@simonhill

Last week we posted a piece for fans of mobile news consumption in the US, and now those of us in Europe are getting some of the action too.

After the The State of the News Media 2012 revealed an increase in mobile news gobbling in the US, ComScore thought ‘we need to get in on this surveying of mobile what-not business’. So here we are, a lovely survey showing how mobile news consumption is up in Europe as well.

And consume we do. You think those yanks like their news on the go? Well, over 46% of us smartphone owning Brits are accessing news through our devices, compared to the European average of 37%. Yep we’re ahead of the curve and beating the our nearest competition the French and Spanish, with 37% and 32% respectively (based on January 2012 numbers). I guess we just want news more, makes you proud to be British.

Source: ComScore website

There’s no word on tablet-based news gorging. Perhaps ComScore think us Europeans are a little behind the US when it comes to table usage. My own survey based on last week’s queues indicates 100% of ComScore employees did not walk past an Apple store last week. 

No insight as to how users are landing on the news pages through their phones either. They survey looked at a mixture of dedicated app and mobile browser traffic. Naturally dedicated app traffic is coming direct through apps, but it would be nice to see if smartphone users are tapping in website addresses or are wondering in through Twitter, Facebook and other social sites.

Regardless, these latest figures show the hunger for news on-the-go is increasing like the clappers on both sides of the pond.

@simonhill

Originally posted on CommsTalk

The Daily Telegraph is about to start charging for its editorial mobile apps, which until now have been free for anyone wanting to read the paper on the go.

In “the coming weeks”, iPhone and Android smartphone uses will have to start forking out £7 a week for the editorial apps as they are bundled into the paper subscription. Only those who already subscribe to the Telegraph print or the £9.99 a month iPad edition will continue to get the apps for free.   

Does this mean the paper is one step closer to erecting a paywall around its website content? There has been discussion of such an endeavour last year, following in the national paywall trend of the FT and The Times.

It’s also possible this is the beginning of a ‘ladder strategy’ for the paper, where web content is offered as the free lure followed up an up sell of the physical print paper and convenience of the mobile apps. That would make yet another variation of the national paywall model, coming in underneath the FT’s ‘you get a few articles a month for free, then pay’ and way below The Times’ ‘all or nothing’ payment approach.

Offering short form content that appeals to the mobile user, such as ESPN Premier League video highlights, suggests the Telegraph sees more of a market for this content amongst mobile device users – perhaps thinking they’re more likely to consume video on a commute or double screening at home. The slight drawback is relying on seasonal sports content puts you in danger of losing regular weekly subs during the off season period. 

Has the Telegraph found the paid content’s paywall sweet spot? It’s a big ask, but we might find out in ‘the coming weeks’.

@simonhill

The Times published an analysis piece over the weekend by business news editor Emily Ford, titled “Why I’m not paying” (you’ll need a subscription to read the article). It’s a short one, but explains succinctly why Emily felt, after a year of paying for Spotify, she prefers the free version.

Despite getting rid of annoying ads, Emily felt syncing music to her mobile had become too much hassle and listening over the web for free is satisfactory. It doesn’t explain what Emily now does for mobile listening. You’d guess good old fashioned downloads or even CD ripping, but then you still have to deal with the hassle of uploading new purchases to your mobile or MP3 player.

Anyhow, Emily finishes her piece with the statement “when you can get something so good for free, why pay?” Any interesting point for a journalist on The Times, the paper with by far the highest and thickest paywall, to make. As Paid Content points out, her subs might have been more than a little surprised when this particular piece of copy crossed their desks.

You can’t compare The Times and Spotify like-for-like, The Times’ subscription model takes an ‘all or nothing’ approach.  You don’t get anything for free, not even the by-line.  However, both companies have similar goals for their paid content models – getting punters to pay for premium, quality content over free options or stealing it from the Interwebs.

Even with these refined, thought-out offerings, it seems not everyone can be convinced of the value of digital content.