The fight to be free, and the right to charge

July 20th, 2009

Just as momentum is building around finding ways for news operations to charge for their information on the Web, one key thinker has said this is a waste of time. Chris Anderson, the respected editor of Wired, has published Free, which argues that - like the music - industry we have to accept that all information is fighting to be free on the internet, and one has to find other ways to make it pay.

Anderson previously published The Long Tail, an important book in understanding webonomics, so it is worth paying attention. Freeconomics (free-conomics, that is, not freekonomics) is based on the idea that the three drivers of internet costs (processing, storage and bandwidth) are all becoming cheaper and cheaper. We are on the path to zero costs, he says.

“It’s now clear that practically everything Web technology touches starts down the path to gratis, at least as far as we consumers are concerned. Storage now joins bandwidth (YouTube: free) and processing power (Google: free) in the race to the bottom. Basic economics tells us that in a competitive market, price falls to the marginal cost. There’s never been a more a more competitive market than the Internet, and every day the marginal cost of digital information comes closer to
nothing.”

This comes just as there is consensus in the newspaper world that there is a need to find ways to charge for online news. There is an onslaught against Google and its role in assisting free access to everyone’s news. Financial Times editor Lionel Barber predicted that virtually all newspaper sites would be charging for at least some of their content within a year. Rupert Murdoch of News Corporation, the grandaddy of the media world, has announced that all his newspapers will be charging within a year. Three new startups have been announced to cater for the model of micropayments (creating a convenient way to pay small amounts to read individual articles).

Journalism Online is said to be proposing that you would pay about $15 dollars to them per year for access to all their member newspapers’ material. They say that not one newspaper they have approached has rebuffed them.

Viewpass has a different model. It sees newspaper publishers being part-owners of their operation and sharing in a range of revenue sources: subscriptions, advertising and bundling.

A third option is Circlabs, which promises “post-search, user-relevant content discovery”. When I understand that phrase, I will let you know. I think they mean that they will offer a quick way to find news material online that goes beyond googling. (Let’s hope they stick to charging and do not venture into editing.)

It’s going to be a fascinating debate. You can read Anderson’s views in an article on Wired, and you can read one of the first shots across his bow, by celebrity intellectual Malcolm Gladwell of the New Yorker.

Entry Filed under: Anton Harber, Journalism, Online, Print