Would you pay to use Twitter? Apparently not. Research released last week revealed that a big fat zero percent of people would pay to use it.
While I view that figure with a good pinch of salt, the study has taken the industry by storm, serving as an unwanted reminder of how time is running out for social media services – and indeed, any sort of online content provider – to get to grips with making their free services profitable.
You only have to look at how The Times is supposedly ‘celebrating’ a dismal 33 percent of retained online visitors (which includes those who simply arrive at the home page and leave without signing up) to know that, in the long term, forcing people pay to for something they can get elsewhere for free just isn’t going to work.
So where does that leave the new media industry?
Even though the majority of publications speculated (and in fact, made fun of) how The Times paywall would be a total failure, part of me thinks they were secretly hoping it would be a success, as it would restore faith in the profitability of the internet and in new media services in general.
The natural alternative to paying for content is, of course, adverts. But with further figures from the aforementioned study revealing that 70 percent of people find online adverts annoying, even though they’d prefer display ads to paid-for content, the industry seems to be speedily hurtling towards a bleak future.
But success stories, rare as they may be, do exist. Take free online music service We7 for example. The first in the market to cover its running costs while still paying proper royalties to artists, We7 uses techniques like localised adverts to run a successful funded-by-adverts free content model.
We7 has therefore proven that advertising can be used to fund a successful, profitable online content service. Let’s just hope that more companies follow in its footsteps, otherwise free, top-quality content may soon be a thing of the past.
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