Media Bites-October 8 2009

Content is king-but will you pay for it?
After meeting with a local print publication recently who informed me that they would now be charging a penny to access online stories- and after News Corp chair Rupert Murdoch stated most of the FOX properties will move to paid content, I wanted to keep beating this drum and ask will consumers be willing to pay for content?

I keep coming back to the same answer: only if there is real value in it at that moment for you.

All media properties are on a quest to develop additional revenue streams without diluting their core products or worse, having consumers cancel subscriptions and suffer further losses. A recent LA Times article noted that Soleil Securities calculated that every viewer that alters their viewing habits, choosing web over TV is forfeiting $920 in annual ad revenue and that Disney, Fox and NBC subsidize $33 million in losses at Hulu which is offset by only $123 million in ad dollars. The skyrocketing cost of producing all forms of TV advertising is underwritten by the $22 billion in cable and satellite subscription fees but it is not enough revenue to generate a profit. The answer seems to be a slow migration to pay for online content access.

Which brings it back to the -only if there is real value at that moment for you. In my opinion, if its a news story then the answer is no. Why? Because if I'm really that interested, I'll surf around until I find it at no charge elsewhere. If its an episode of 'Its Always Sunny in Philadelphia' or 'Glee' that I want to see, or have the ability to download a full length movie to my Iphone-you bet I'll pay for that because its entertainment and I'm programmed to pay for entertainment. I'm not going to pay for the news when it's available 24/7 everywhere you turn.

If sites like Hulu.com and Fancast.com position and price themselves correctly, I believe you'll see not only increased usage and revenue, but more sampling of on air product as well. Print pubs are betting that if they price it more aggressively for subscribers, they will increase circulation. Only time will tell if that though process will work.