Is Rupert wrong?

Beverley Head
Wednesday, 01 February 2012 16:58

Business IT - Networking

Traditional media companies the world over are grappling with what they should provide free online, and how and if they should charge for content. In Australia the two main print juggernauts News Ltd and Fairfax have switched strategies - with Fairfax now giving away free the content it used to charge for, and News locking up once free content behind a paywall.  A new global report released today by KPMG suggests it's Rupert Murdoch's News Ltd that may have it wrong.

KPMG's newly released report, The Converged Lifestyle, notes that 73 per cent of people said they wouldn't pay for online content - with 56 per cent of respondents to the international survey saying they'd go elsewhere for their information rather than pay.

The report also found that only 30 per cent of people were prepared to pay for their online business news, and fewer than 20 per cent were prepared to pay for general or sports news online. The report did however uncover a tendency for people to be more willing to sign up for paid content after they had enjoyed a free trial (and presumably found the experience worthwhile).

Malcolm Alder, national managing partner for the Digital Economy at KPMG, however recommends the report's results require cautious analysis.  'The raw numbers suggest that there is a major challenge in getting people to pay' for content that they once expected to receive for free, Alder confirmed to iTWire today.

However he said there were many examples of people ultimately proving willing to pay for services or products that were once available for free. He pointed to the rise of the multi-billion dollar bottled water industry and toll road sectors as good examples of such non-intuitive behaviour.

Mr Alder said it was too simplistic to assume that people would not pay for anything, regardless of their responses to a survey, but he said that companies wanting to prosper online needed to start thinking of people accessing information online as customers rather than simply an audience. With the right package of content, and a friction-free means to pay for it, purveyors of online content might find the outlook was 'not as bleak as the raw numbers suggest.'