Nic Covey, Director, Cross Platform Insights, The Nielsen Company
Will consumers pay for online news and entertainment they now get for free?
Nielsen asked more than 27,000 consumers across 52 countries, and the answer is a definite “maybe.” As expected, the vast majority (85%) prefer that free content remain free. Yet there are opportunities to be found in the details. Indeed, when asked to focus on specific types of content, survey participants are more willing to at least consider paying for particular categories, especially if they have done so before.
Will Pay / Won’t Pay
Online content for which consumers are most likely to pay—or have already paid—are those they normally pay for offline, including theatrical movies, music, games and select videos such as current television shows. These tend to be professionally produced at comparatively high costs.
Consumers are least likely to pay for content that is essentially homegrown online, often by other consumers at fairly low cost. These include social communities, podcasts, consumer-generated videos and blogs.
In between are an array of news formats—newspapers, magazines, Internet-only news sources and radio news and talk shows—created by professionals, relatively expensive to produce and, in the case of newspapers and magazines, commonly sold offline. Yet much of their content has basically become a commodity, readily available elsewhere for free.
Whatever their preferences, consumers worldwide generally agree that online content will have to meet certain criteria before they shell out money to access it:
Despite the growing consensus that the media may only be able to generate appreciable online revenues by charging consumers for content, there is little agreement on just how to do that. Companies are experimenting with a range of payment models, from full service subscriptions to individual transactions, or micropayments. Among those surveyed by Nielsen, about half (52%) favor the latter, albeit micropayments have proved cumbersome to implement in the past. But a more manageable system may be no more enticing. Only 43% say an easy payment method would make them more likely to buy content online.
Regardless of what systems they choose, media companies will almost certainly not abandon advertising; and consumers will doubtless still see ads along with paid content. For the 47% of respondents who are willing to accept more advertising to subsidize free content, that may be tolerable. Yet it will probably not sit well with the 64% who believe that if they must pay for content online, there should be no ads.
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