Monetising future content

I was at the Future of Media Summit 08 on Tuesday and one of the discussion groups I attended focused on business models going forward as media organisations attempted to rationalise the continued breakdown of their traditional content models.

The move away from subscription-based and ‘pay for content’ systems was questioned as potentially due to a weakness in current technology, rather than an intrinsic and systemic change in the media environment and consumer needs.

Dr Stephen Hollings, CEO of News Digital Careers, asked whether the internet simply had not delivered the right form of micro-payment system that provided the required flexibility to all parties.

This is an important question. In a modern environment of information overload, will participants (and by this I mean those who read, interact and give feedback to media and content providers through comments, uploads and other connections – as outlined by Chris Saad in his presentation at the Summit) ever pay for anything again? Commentators cast the digital generations as having shorter attention spans, wanting greater diversity of views and perspectives, shorter pithier articles, videos and audio pieces. In short, they want to consume smaller things more ravenously – and be acknowledged for their contribution to the cycle of creation. This new media momentum is not stopping.

If this is true, complete subscriptions to publications of which few articles are read will be a hard-sell to participants who surf the web or, rather, take feeds from multitudinous sources to aggregators like Google Reader.

In the absence of an adequate micro-payments system, is advertising the only real source of revenue for online content creators? And if so, how do we organise ourselves into powerful engaging entities that will deliver relevant, salient information to transient participants and what will be the acceptable formats for advertisers?

(Update: Ross Dawson, who organised the comprehensive trans-Pacific Future of Media Summit, has just posted a list of 16 blogs covering the event.)

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6 Responses

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  2. […] discussion of FREE online business models raise many of the same questions that my posts about advertising-driven and subscription-driven media models did after the Future of Media Summit 2008. Read people’s comments on his […]

  3. Rod Peno, Social Media Producer for News Digital Media and Editor of the Wires and Lights in a Box Blog, discusses reports on the Future of Media Summit 2008.

  4. Thanks for the comment Sean,
    You have touched on an important point about businesses in decline and those in their ascendancy.
    I decided to continue my full reply as my next post!

    By raising music you have also pointed to the different treatment for types of content: entertainment versus information. With entertainment, it is the final product for consumers. Information is a means to an end. This informs the way companies can monetise the content.

  5. Just been told that the “stubbornmule” link in my comment is pointing to my old twitter name. The new name is seancarmody and my blog is Stubborn Mule. Didn’t really mean to turn this correction into shameless self-promotion, but there you go!

  6. Advertising is likely to continue to dominate as the business model for digital media (much as it does for a number of traditional media such as free-to-air TV and many newspapers). However, other models will find their place too.

    For example, musician Jonathan Coulton has had a fair degree of success selling his music online (without any copy protection) despite the fact that it’s easy to get hold of all of it for free. This is largely because he has built up a loyal fan base who are happy to support him. Online it is possible to tap into large numbers of people even if you are a niche provider and as long as a proportion of this audience is prepared to contribute financially, there is some revenue to be made.

    I also think that subcription content will also survive, but probably more in a corporate environment: people are happier to pay for subcriptions on the company account than on the personal account. Examples in the area of finance include the Australian Financial Review online and Breaking Views. I am sure there would be similar offerings in other industries.

    These sorts of questions are often viewed as either/or, but I consider this is a false dichotomy. Yes advertising will dominate, but there is also room for other revenue models to grow.

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