Nielsen reports on paying for content online
Nielsen recently did a study where they asked 27,000 people across 52 countries if they would pay for content online, and got a resounding “maybe.” They did break down the survey into more specific areas like movies, games, music, news and radio to name a few, and while the results to some may be surprising it’s not to me.
The top three categories that more people said they’d pay for wound up being Theatrical Movies, Music and Games. Not surprising with services like Netflix, iTunes and online games and networks like Steam. Netflix lets you rent and stream movies online or through your Xbox or PS3 and has made many people turn away from the more traditional storefront for renting movies. Apple’s iTunes revolutionized the way people got their music and the way they developed the pricing is probably one of the big reasons. I like being able to have the choice to buy only a couple of songs from an album for around $.99 a pop instead of buying the full album for $15+ retail. And gamers have a vast array of games to choose from, whether it’s fans of World of Warcraft, Steam, or even the casual gaming sites like Pogo.com.
I’m definitely not surprised that more people would be adverse to paying for things like news, radio, blogs or podcasts online. There are just too many ways to reproduce them and distribute for free. Not to mention we’ve become used to being able to download podcasts for free, and with sites like YouTube and Hulu we can watch short clips and TV shows online. Sites like Digg.com and even certain Twitter news feeds can bring us the latest in news and even offbeat topics and trends.
At the same time, companies need to be able to make money for their content somehow, and newspaper and magazine sites seem to be two of the ones I’ve seen struggling with business models for this. Some have tried micropayments for certain content and others are trying subscriptions. From the study, Nielsen determined that online content would have to meet certain requirements for consumers to consider paying for it, and this is a good breakdown of the findings:
- Better than three out of every four survey participants (78%) believe if they already subscribe to a newspaper, magazine, radio or television service they should be able to use its online content for free.
- At the same time, 71% of global consumers say online content of any kind will have to be considerably better than what is currently free before they will pay for it.
- Nearly eight out of every ten (79%) would no longer use a web site that charges them, presuming they can find the same information at no cost.
- As a group, they are ambivalent about whether the quality of online content would suffer if companies could not charge for it—34% think so while 30% do not; and the remaining 36% have no firm opinion.
- But they are far more united (62%) in their conviction that once they purchase content, it should be theirs to copy or share with whomever they want.
Again nothing too surprising to me as this is what I’ve heard from friends and collegues recently. It will be interesting to see what companies come up with in the future and what business models will work.