Six Pixels of Separation - The Blog
December 30, 2010 3:09 PM

Content Pays

Here's a newsflash: people will pay for content online.

You may think that the statement above runs contrary to everything we know about the Internet. From music and the torrents to pay walls at newspapers and magazines. Mostly, the people who are complaining that consumers will never pay for content are the ones who are simply taking their content from its traditional form and migrating it to the digital platform. Beyond being able to deliver true value online (more on that here: People Pay For Value - Their Value, Not Yours), consumers have not really felt the need to pay for content.

But all of that is changing.

Today, MediaPost ran a news item titled, Pew: Two-Thirds of Web Users Buy Online Content, based on Pew Internet's latest report, 65% of internet users have paid for online content. Here's what we've learned: "Among the 15 categories the study asked about, music and software were the most commonly purchased types of content, with one-third of users having paid to download or access each online. Those were followed by mobile apps (21%), digital games (19%), newspapers, magazines or articles (18%), videos, movies, or TV shows (16%) and ringtones (15%). E-books, which have gained popularity with the emergence of Amazon's Kindle and other e-reading devices, have been bought by one in ten Web users to date. A quarter of Web users have bought only one type of content and a majority (61%), three or less."

It's just getting started.

While this was the first time that Pew surveyed people about paying for online media, this particular finding "roughly matches the proportion that pay for tangible goods online like books, CDs or clothing," says the research company. There are many mitigating forces at play here. Although it only ranked at 21%, mobile apps and the app economy is probably one of the bigger reasons people are getting more and more comfortable with the idea of virtual goods. Having access to something useful anywhere and everywhere (and this includes in the palm of your hand) is a big (and still relatively) new idea. The smaller the devices, the more portable they are and the more simple they are to use (re: ubiquitous), means the more value there is in paying for content.

Think about it this way...

If you can now buy a magazine subscription, have it downloaded to all of your devices with ease on the day of publication (sometimes earlier) and then be able to go through it on a myriad of devices (computer, laptop, smartphone, tablet, etc...) the ease of access adds a valuable premium to going down this digital route. Couple that with the ability to have countless titles on one small device (and not creating stacks of paper at work and at home) with a highly interactive experience embedded within it (live links to to everything that is being discussed and multimedia extensions and additions through bonus audio, video and images), and you can better understand this big shift that Pew is talking about.

All media must be digital.

There's no lie there, but all media that wishes to extract money from a consumer must do much more...

  • It must be mobile.
  • It must be asynchronous.
  • It must have added multimedia value (bonus material).
  • It must be easy to access.
  • It must be easy to download/stream.
  • It must do more than simply being a digital version of the traditional platform.
  • It must be able to make itself more shareable, findable and social.

Where there is value, there are consumers willing to pay for it.

*UPDATE: here are two new Blog posts that are directly related to this topic that well-worth checking out:

By Mitch Joel