So now our industry is reverberating to the noise of content pricing. Heard it all before? We have in more ways than one. Ever since Rupert Murdoch first began talking about charging for online access, and John Ridding of the Financial Times echoed that notion, we hear that more and more publishers are looking at how to charge for their content. And of course, as is usually the case in our industry, the lemmings are rushing toward a solution, regardless of the strategic analysis, or consideration of its likely outcome.

Remember tabloiditis? After The Independent in London converted from broadsheet to tab in 2003, dozens of papers followed suit by halving their page size. Few benefited in circulation, and many lost their trousers in ad revenue.

Then there was the free newspaper frenzy. It should have been a success for a few, but in typical fashion too many publishers joined the fray. And who's the latest casualty of the free-for-all? None other than Murdoch's London Paper.

Take another look

So before you charge, lemming-like, into charging. Stop! It probably won't work for you.

Mr. Murdoch, with The Wall Street Journal, and Mr. Ridding, at the FT, may have good reasons to believe they can charge for their content. Readers will pay for the premium, actionable data that's contained in financial newspapers. I know I do.

In fact, I will confess that I was amazed when FT raised its price by 50 percent and lost very few subscribers in the process. But papers like The Journal and FT have another built-in advantage: In many cases, subscriptions to these august journals are paid for by the reader's employer.

The key issue with pricing - of any product - lies in determining what the consumer is paying for and why. For the printed newspaper, readers (in Western markets at least) are presented with two hours of content, of which they read a quarter, for approximately 30 minutes. Sadly for the accountants, everybody's quarter is different, but that is the compelling attraction of the newspaper medium. I ignore sports, but love international news, features and analysis. My wife loves sports and design. What a great product.

Different strokes

Online, the world is very different. In Switzerland and Sweden, two of the world's most enthusiastic Internet markets, users spend around an hour online each day.

Contrast this to the United States, where, at least as far as newspaper Web sites are concerned, users spend only about 4.4 minutes per visit, according to the NAA.

What's more, daily reach of online newspapers is about 10 percent of the adult population, compared with 45 percent for the printed newspaper.

So the questions exist: How much would digital consumers be willing to pay - for an experience of five minutes' exposure, and six page views per visit - given their perception that content is free? How can that content cost be justified? And how will any online revenues gained from consumer access impact advertising revenues?

To answer the last question first: Sadly, too little research has been undertaken on the econometrics of online audience dualities - in other words, the relationship between the audience and advertiser value per consumer. Newspaper companies are woefully unwilling to pay for market research, and we are paying for it now.

How much, for what?

To the first question: Consumers will pay for content. And the best example is mobile, where we all pay every day to text each other banalities. We will also pay to download facts and other information once the telcos wake up to the fact that their punitive pricing models are screwing their consumers, and ultimately inhibiting their business growth. But content pricing requires two things. And here is where a possible route to market might lie.

Mobile pricing makes micro-payment subliminal and easy. But will I treat content on an article-by-article basis? No. Will I accept a low-cost subscription for previously undefined content? Probably not.

To the second question: Newspapers win in a scenario where the goal is to attract high volumes of users who don't hang around. Five minutes is not long. But it is enough time to direct users to other branded services, such as jobs, directories, search or dating. This is how Sweden's Aftonbladet, possibly the newspaper industry's most successful digital player, has leveraged its audience. After it began concentrating its efforts on digital marketing, Aftonbladet has transformed itself from a newspaper-centric Web site to owner of five of Sweden's top 10 Web sites.

The ad quotient

A final consideration: digital advertising revenue.

Newspapers are winning the battle for online display and classified revenues - though they are not doing well in terms of new digital revenue streams - and I remain of the view that newspaper digital profits could over the next five years exceed the decline in profitability they are now seeing in print.

But I do not believe these profits will be derived from content.

Content may be king, but content plays another role: It is also the route to connectivity.

In fact, modeling the potential impacts of content pricing versus advertising pricing is a relatively simple exercise. And setting up online pricing trials, in order to measure how charging for content will affect consumption, and by extension, advertising, is simple and inexpensive.

Inevitably, there are cases where paid-for content can work. But this is no panacea. Our industry is littered with cases of lemmings with no solution chasing those with the wrong solution.

Add another chase to the list.

Jim Chisholm is a principal of iMedia, WAN-Ifra's joint venture advisory service. He can be reached at jim.chisholm@imediaadvisory.com.

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