Why Micro-Payments Aren’t Going To Save Journalism
At this point you may have heard the news that Rupert Murdoch is going to introduce micro-payments for individual Wall Street Journal articles sometime this fall. It’s evidently going to be a “sophisticated” system… If there’s anything the average consumer loves, it’s complex and sophisticated online ordering mechanisms. Personally, I think his timing is fantastic too. The economy has never looked better, and I know most people are looking for ways to spend all the money that’s just piling up in their pockets.
Obviously, the print industry is in big trouble. Somehow, inexplicably, in 2009 the Internet has caught them off-guard and they are struggling for ways to stay afloat. So, the WSJ will be giving micro-payments a shot. To be honest, it’s not really a revolutionary move. Traditional pubs have tried using micro-payments as an online model in the past, and it has failed. Live and don’t learn I guess. Now, print industry leaders would like to have us believe that times have changed. “Just look at iTunes success,” they say. The thinking is that the consumer is now used to paying for small pieces of content online and will subsequently be more receptive to adopting the model this time. Well, yes and no. This model clearly works for music, and will work for movies, but won’t work for articles, here’s why:
- Everyone is now accustomed to getting their news online for free. Why would consumers suddenly start paying publishers for something that they haven’t had to buy before? Where is their motivation? When music was “free to download”, everyone knew deep down that they were stealing it. There was no legitimate solution that satisfied the consumer’s need for digital downloads until Apple put one together. The difference here is that the publishers are putting their own articles on the web for free. Nobody’s conscience is bothering them because they’re reading these articles.
- The options for news online are relatively infinite, and virtually all of it’s free. Consumers have options, and if Murdoch wants to charge, that’s fine, it’s his right. But people will just go someplace else. When something happens in the news, there is a flood of content. There’s no shortage of coverage, or options for the consumer. But when Green Day releases a single, there’s just that one song, there’s just that one option for the consumer.
- When consumers buy a song, they know exactly what they will be getting. They know for a fact that they want it, and will like it. That is just not the case with an article. Much of the end product that you are purchasing is a mystery. Purchasing an article is simply more of a “risk”.
- My freshman year suite-mate seemingly listened to Nate Dogg and Warren G’s “Regulate” on repeat for an entire year. I bring this up to raise two quick points, 1) music fulfills an emotional need for the consumer. And 2) music is a product that is reusable and has a relatively long shelf life. This means, that in the consumers mind, their micro-purchase will be providing value for a long time to come. Articles on the other hand, are a one and done type of product.
So, Mr. Murdoch, you want me to buy something, sight unseen, that I will only use once, and can get a (relatively) comparable version of for free?
It seems to me that Murdoch is making a classic interactive marketing mistake. He’s building a “solution” based on how he wants the consumer to act, not based on how they actually do act. His plan is focused on not cannibalizing the Journal’s existing revenue streams. He’s putting what he wants, or hopes for, above the realities of his consumer’s needs. This business philosophy didn’t work out for the music industry, and my guess is it won’t save journalism either.
And make no mistake about it. We need journalism to be saved. I’m not talking about the hard news. As noted above, we can get that from numerous sources. What we truly need is investigative journalism. In depth analysis. And, my guess is that journalism will be saved. If there’s a need, or a consumer demand, someone will fill the void. I think real innovation will come from outside the existing print community though. They’re just too close to it. Too unwilling to change. Just as Apple came in and revolutionized music, an outside player will have the epiphany that ends up saving investigative journalism. That’s what I hope at any rate. So, what do you think? jack2point0
Tags: Apple, Green Day, Journalism, micro-payment, Print, rupert murdoch, the wall street journal
