Andrew is Chief Marketing Officer for the Global Media division of Ipsos. He has written or contributed to two books on broadcasting in Asia including Television in Contemporary Asia (Sage, 2000) and From Mao to the Millennium: Chinese Broadcasting in Transition (BMRB, 2001). Ipsos will shortly be publishing his new book From Primetime to My Time: Audience Measurement in the Digital Age.
Last month, research commissioned by paidContent:UK found that 74% of British adults using the internet to access free news sites would look for another free site if their favourite one started charging. Not surprising really â€“ why pay for something if you can get it for nothing?
In the music business, it is estimated by the International Federation of the Phonographic Industry that, in 2008, a full 95% of music tracks globally were downloaded without payment to the artist or producer.
Many people still buy CDs. Others are happy to download songs from iTunes or subscribe to legal services. But if you ask them whether they would prefer something to be free or would rather pay, isnâ€™t the answer (providing they donâ€™t perceive the risk of being caught as very high) rather obvious?
The issue of monetising content is now the number one priority, not just for companies producing news. It also tops the agenda for music companies, movie studios and television networks. All are faced with record demand for their products â€“ but declining willingness to pay.
Consumption of music around the world (when both legal and illegal sources are combined) is at an all time high. As is television viewing. Box office revenues at the cinema hit a new record last year.
The printed editions of newspapers have suffered declining circulation and readership in many countries over recent years. But the falls have been more than been made up for by growing usage of newspaper websites. In Great Britain, for example, the number of adults claiming to read a daily or Sunday national newspaper fell by 5 million between 1999 and 2009. Yet 16 million people visit one or other of the national newspaper websites every month.
It is clear that newspaper publishers, music companies, movie studios and the creators of video entertainment need to develop new business models that go beyond simply creating product and selling it in the ways they did before.
In the survey quoted earlier, people were asked how, if all the newspaper sites charged for access instead of being free, they would prefer to pay. A little over half chose a subscription model with the rest split evenly between paying a daily access charge and paying per article.
But it was rather a hypothetical question: there will always be free general news available on-line; specialised titles like the Financial Times and Les Echos already offer subscription packages to those wanting to access their full content on-line. Their unique content has great value to readers and cannot easily be sourced elsewhere.
Towards the end of the survey people were asked what the maximum they would be prepared to pay for the payment option chosen. Unsurprisingly, the vast majority picked the lowest price offered.
The only thing we can learn from these kinds of survey is what we can already guess â€“ people prefer not to pay for something if they donâ€™t have to.
What is needed is a far more in-depth probe into the consumerâ€™s mind to understand what the value proposition is for all the various kinds of content they a