Paid content & paywalls:how to make money with contents

(in a B2B environment)

Alessandro Cederle – President, ANES

FIPP World Magazine Congress

New Delhi, 11 October 2011

This planet has — or rather had — a problem, which was this: most of the people living on it were unhappy for pretty much of the time.

Many solutions were suggested for this problem, but most of these were largely concerned with the movement of small green pieces of

paper, which was odd because on the whole it wasn't the small green pieces of paper that were unhappy.

Douglas AdamsThe Hitchhiker’s guide to the galaxy

Money often costs too much

Ralph Waldo EmersonThe conduct of life

There’s a trick somewhere

Contents move around more than ever, people and companies consume contents more than ever, the content ecosystem is thriving … but it’s more and more difficult to charge for content exchange

• Advertising: a user is worth x times less than a reader

• Content: “free” is the password on the net

Why is that happening?

• “disintermediation”: people and companies exchange transactional data among themselves, no interMEDIAtion requested

• “open economy”: making internal contents available to the outside is easy and cheap

• “content inflation”: cost of producing and distributing contents tends to zero, so everyone is doing that

Still, there are indeed companies

making money selling contents –

sometimes contents which are seemingly

commoditized

Case 1: weather forecast

Weather forecast is all over the place, and it’s for free!

People care about weather forecast – specialized sites and specialized TV channels are top traffic/audience generators, and the information is just everywhere

Still, professional operators (farmers, energy grid managers, aviation, etc.) need something more in the way of:

• Micro-localized contents

• Accurateness

• Special services (alerts, indexes, etc.)

Accurate and hyper-local information are nota commodity if you are flying an airplane orbalancing power on a grid, it’s a requisitefor doing business.Therefore you are ready to pay for it being up tothe needed requirements.

Case 2: tender notification

Tender information are public by definition – actually, by law!

As more and more public administration entities go on-line, tenders are available for free at the click of a mouse, or at the scraping of a spider

Still, professional operators (construction companies, sanitary equipment manufacturers, etc.) need something more in the way of:

• Sorting relevant tenders through the mass published each day

• Relevant data upfront for quick selectionand browsing

• Easy to read, handy data

• Special services (e.g. CRM)

Saving time and money by bringing to the customerattention the relevant information is somethingthat the client it is willing to reward.

In a way, the inefficiency of the public sector creates opportunitiesfor those who resolve it.

Case 3: prices

Prices are everywhere. In a world which is becoming more and more financially literate, they are published, shared, embedded, commented, cursed …

Marketplaces are an Internet killer application, and constantly evolving (couponing…)

The bar is constantly raised, as services based on other revenue sources (e.g. advertising) enrich their contents to attract users

Still, professional operators (stock, materials, etc.) need something more in the way of:

Speed

Timeliness

Comprehensiveness

Depth of content, scope

Elaboration (ratio, comparisons, etc.)

In this case, the relation between content quality andmoney is so direct that there is no question that someserious professional service will be needed.

So, where is the trick?

The golden rule:if contents add value to my value chain, I’m willing to pay

What’s value?

• Speed

• Timeliness

• Accuracy

• Categorization

• Depth and scope

• Verticalization (hyper local, hyper sector …)

So, here is the trick reversed: if you are going to give me something in the right place, at the right time, in the right format, quick, granular, conveniently formatted so that it will fit into my processes, and if this helps me to do my business better (i.e. less cost or more revenue), paying for it is literally a no brainer

Therefore the real trick is that most contents are common, uncategorized, in a one size fits all format, written in a way which is determined by the tradition and profession of the writer (???), etc - therefore they don’t retain such a value that can be monetized

So, what do we need to do? (1/2)

• Forget what you have: start from what, when and how the customer needs contents in your domain. Visit your clients, stay there while they are working their daily shift, see what they need, how and when.

• If we go for the “customer centric “way, vertical is the password. Standard doesn’t exist, relevant is everything.

• Chances are you already have some content you can make money with – but sure enough, most of what you are providing is losing value every day. So dig into your content repository and be ready to waste most of it.

• In order to dig for gold, there are some serious technological options you will have to take care of – things like DBMS, data mining, etc

So, what do we need to do? (2/2)

• Looking at contents this way is completely different from the traditional way – the definition of “quality” is different and this is relevant for people and professions

• Pricing is tricky: pay as you go, yearly subscriptions, freemium models …Again, start from what is more convenient to the customer and you will build a solid customer base.

• Don’t worry about cannibalization – again, it’s not the content itself, it is the way you provide it

• Mobile is a huge untapped opportunity: this is not about providing soccer results while people are trekking with the family, it’s about how can we add value by providing contents out of the office, when and where it is needed

Thank you !

presidenza@anes.it

alessandro.cederle@gmail.com