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Online Journalism News

Confidence grows in paid content

Posted: 30/01/04 By: Jemima Kiss
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The UK's web publishers are riding high on a new wave of confidence in paid content, encouraged by significant take-up of web subscriptions and more flexible payment technologies, industry leaders concurred yesterday.

Introducing the paid content forum at the Association of Online Publishers in London, PaidContent.org founder Rafat Ali said that the success of micropayments in the entertainment industry has increased consumer confidence in online spending.

Richard Withey, global director of interactive media for UK broadsheet the Independent, told the forum that around 20 per cent of revenue from Independent.co.uk is now generated by paid content.

"The Independent's news has a value in print, so why give it away if people are already prepared to pay?" said Mr Withey.

"Newspapers are made up of a number of services and sub-brands, and it is the quality of our content that allows us to charge."

For broadsheet newspapers, the cover price accounts for around 40 per cent of revenue with advertising acounting for the other 60 per cent.

"I think it would be very healthy if web newspapers could achieve the same ratio," he said.

Anne Ridyard of IDG, publishers of PC Advisor and MacWorld, said that traffic plummeted when they locked off most of their content overnight, but within one year levels had risen again beyond their projections.

"We just wanted the process to be easy - simple financially, simple technologically and simple for the end user," she told the forum.

After a re-design, the company decided to market its paid-for services more agressively - clearly promoting premium content on the home page.

Web sites can offer a number of payment methods to consumers: credit cards; debit cards; stored value accounts, such as PayPal and Nochex; money transfers, such as Western Union; and bank transfers. Some sites also ask users to phone or text for a pin number that allows them to access premium areas of the site.

"There is no perfect payment method - only different solutions for different kinds of content providers," said Scott Law, managing director of Metacharge, an online payment service.

"Paying by SMS [mobile phone text messaging] was a religious experience for me the first time I tried it; you text a number, and get a pin sent within 30 seconds."

Despite being fraught with implementation problems for publishers, SMS payment systems are popular with consumers. Twice as many people in the UK have mobile phones than credit cards, and SMS payment is an effective way of reaching under-16's without credit cards.

"Consumers are not afraid to pay for things - they do it everyday," said Mr Law.

"Those of you sitting on the side lines - don't intellectualise about it. Just dive in and do something!"

See also:
http://www.ukaop.org.uk
http://www.paidcontent.org
http://www.independent.co.uk
http://www.metacharge.com

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