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74. Micropayments and Saving Newspapers (Feb 2009)

74. Micropayments and Saving Newspapers (Feb 2009)

Micropayment is a model that has been kicked around at some point or another for every web based content idea that was ever in need of a monetization strategy. In principle, it works like this, create a system that allows people to pay very small amounts of money in order to access content that they want — according to the Times,

“Under a micropayment system, a newspaper might decide to charge a nickel for an article or a dime for that day’s full edition or $2 for a month’s worth of Web access. Some surfers would balk, but I suspect most would merrily click through if it were cheap and easy enough.”

The problem has always been that unless the platform is locked down (in the case of the iPhone app store) or everyone in the industry agrees to the system (thus removing alternatives) there is little incentive to pay for content when there is a huge number of free alternatives. We don’t have to define alternatives by “exact copy,” in many cases it’s enough for people to get something sufficiently similar to the content they wanted.

The system could be used for all forms of media: magazines and blogs, games and apps, TV newscasts and amateur videos, porn pictures and policy monographs, the reports of citizen journalists, recipes of great cooks and songs of garage bands. This would not only offer a lifeline to traditional media outlets but also nourish citizen journalists and bloggers. They have vastly enriched our realms of information and ideas, but most can’t make much money at it. As a result, they tend to do it for the ego kick or as a civic contribution. A micropayment system would allow regular folks, the types who have to worry about feeding their families, to supplement their income by doing citizen journalism that is of value to their community.

Maybe micropayments are the answer, but the idea still doesn’t take advantage of what newsrooms are good at – developing robust, deep content – the type of content that is difficult to copy and that has limited alternatives available in the market. By working on packaging this style of content, newspapers could create information products that could sell.

In some ways to see this with financial information, people are willing to pay a premium for well organized, high-quality financial data. The challenge is for newspapers to figure out how they can co-opt this for general interest content, and if they can’t, what types of content they are able to sell.

This segments clip is from Salon, who has been testing a community outreach and micropayments model with their “Open Salon.”

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