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[P]
Salon's stab at being a pay site

By Kellnerin in Media
Wed Mar 21, 2001 at 07:54:49 AM EST
Tags: Internet (all tags)
Internet

In an "Important message to our readers" buried on the front page, Salon announces Salon Premium, "a special service ... that will include not only all the regular Salon fare but additional 'bonus' features available only to subscribers."

Didn't Slate cede the edge in the Web zine wars to Salon by going pay once upon a time? But this is different ...


Salon isn't going pay-only: it's offering its "Premium" service for $30/yr for which they offer, in addition to the "bonus" features (whatever they might be), an ad-free site. Hey, now that might actually be worth paying for (and, the editors of Salon are no doubt hoping, will probably generate more revenue).

What's sad, though, is the tone of the announcement. I guess it's refreshingly honest, rather than going the route of "Now announcing a new way to rip you off that you're just going to love!" but it's a somewhat pathetic confession of "Ok, we tried, even laid off the greater portion of our staff, but as you all know that IPO thing didn't work out and we really need money now ... even if you don't sign up for the pay service, please at least click on the ads ..." Though it also comes with a warning that if you do stick with the free version, the ads are going to get bigger and more obnoxious.

*sigh* I used to spend significant chunks of time browsing that site, and they did have some interesting features such as the Free Software Project, but there's been less and less worth reading lately. I still pass through Salon on weekdays out of habit, but I'm slowly curing myself of that particular tic. What does anyone else think, or are we all past caring?

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Salon's stab at being a pay site | 37 comments (35 topical, 2 editorial, 0 hidden)
So? (1.71 / 14) (#1)
by eLuddite on Tue Mar 20, 2001 at 08:44:27 PM EST

All the other soft core porn sites have some kind of paid membership plan.

---
God hates human rights.

no longer (4.00 / 1) (#37)
by chriss on Mon Mar 26, 2001 at 01:16:45 AM EST

Yes, subscription seems to work for porn sites. And advertising seems to work too, at least there is an unbelievable amount of porn banners, even on non-porn sites.

But there are some circumstances special to porn:

- People were willing to pay a lot to avoid being catched in a blue movie, so they were willing to pay for VCRs and video tapes. And so they paid for subscriptions for porn sites, avoiding to involve even the salesman.
- There is a lot of content that can be recycled over and over again. I don't think that besides private voyeur pics and webcams many pictures or movies are produced for the web. So content is very cheap and therefore porn sites are very cheap to set up.
- The Porn industry has always been willing to experiment, and so they were the first establish pay models on the web. The first movers in advertising, eCommerce, auctions etc. seem(ed) to be successfull, too.

So porn sites seem to be in a very good position to establish subscription models. But it being so easy to set up another porn site they'll also be hit with problems. You can't set up a free porn site, because one day later the costs for transfer will kill you. You can't set up a new site and attract enough people to subscribe, even though your cost are very low, because there are so many sites trying this. Advertising is the same.

The first porn sites where very successfull with subscription. But that's no longer true for everybody else. Yahoo was very successfull with advertising. But that's no longer true for everybody else either.


[ Parent ]
Salon (2.25 / 8) (#2)
by aphrael on Tue Mar 20, 2001 at 08:49:55 PM EST

I basically only go there when someone sends me a link to an article and says 'this was really interesting'

Subscription Vs. Pay Per View (4.37 / 8) (#3)
by Eloquence on Tue Mar 20, 2001 at 08:51:47 PM EST

The problem with subscription services is that you must be a real fan of a site to pay for it, even if it's just $3 a month. If you're a subscriber, you feel obligated to visit regularly, just to get your money's worth. That's why a micropayment standard is needed (and yes, I've read Shirky's article, and disagree with it). Then you can pay 10 cents for reading that particular article in the Sex section, or the latest Tom Tomorrow comic strip. Unfortunately, such a standard isn't here, and until it is, I presume that most subscription-services that are centered around a single site will fail.
--
Copyright law is bad: infoAnarchy Pleasure is good: Origins of Violence
spread the word!
why micropayments? (3.00 / 1) (#5)
by cory on Tue Mar 20, 2001 at 11:03:16 PM EST

OK, here's what I don't get. If you want to read all about Tom and Nicole's divorce in People or browse through the letters to the editor in Newsweek, you fork over your three or four or five bucks, or whatever it is, read your one article and maybe a few others, then toss the mag in the trash. What you *don't* do is drop a quarter in a slot and get a print out of just that section. So why should it be any different on the Web??

And please don't reply with "because it's possible on the Web" because it's possible in real life, too.

Cory


[ Parent ]
Because it's much easier & cheaper (none / 0) (#28)
by Eloquence on Thu Mar 22, 2001 at 04:03:27 PM EST

Sure, you could have customized newspapers IRL, but it would be very expensive. Not only because of the printing stations themselves, also because of the printing cost and speed. Of course I don't want to read the complete magazine and would love to print out only parts of it (not necessarily single articles, but articles by certain authors, and certain sections only), but it is not done because it's too expensive and slow. On the Internet it is possible, therefore it should be done.
--
Copyright law is bad: infoAnarchy Pleasure is good: Origins of Violence
spread the word!
[ Parent ]
Just because you can doesn't mean you should (none / 0) (#29)
by Michael_Cox on Sat Mar 24, 2001 at 10:27:51 AM EST

Just because something can be done doesn't mean it should. People get so caught up about the fact that they can they don't stop to think about the question of if they should.

[ Parent ]

Payments are a barrier (4.00 / 1) (#6)
by Philipp on Tue Mar 20, 2001 at 11:03:48 PM EST

The reason why micropayments don't work is that they put up a barrier: Even if it is just 10c, I'll think twice if I want to spend that money on an article that haven't even read yet, and will feel pissed if it is not what I expected.

I am quite optimistic what the subscription model is concerned: It works for public radio and television, so why not on the web? The people who read news on the web tend to be more affluent ($30 is really nothing for a whole year for those folks ("us"). Even if you are not really buying the content, you buy a good feeling that you are doing the right thing. Call me naive, but I do believe that people go for that.

alias kn 'killall -9 netscape-communicator'
[ Parent ]

But people are doing this all the time (none / 0) (#36)
by chriss on Mon Mar 26, 2001 at 12:52:51 AM EST

Most people are willing to give some bucks for a mag without reading the articles before. They may glance at them and check whether the headlines sound interesting, but if they know the mag they often will buy it without checking at all. This should work on the web just as well, as soon as people have accepted the idea of paying at all.

[ Parent ]
I love Salon (3.80 / 5) (#4)
by Philipp on Tue Mar 20, 2001 at 10:55:07 PM EST

I really like Salon, it has some of the best articles in politics and culture. Check for instance their reporting on the ongoing Campaign finance reform debate.

The harsh reality of the world is that the writers need to get paid and that money has to come from somewhere. This can be either from advertising or subscription fees. The advertising model seems to fall apart as we speak.

I really like the way they are going: Keeping the site open for everybody and collecting donations. I definitely fork over $30 a year, that is really nothing compared to the cost of newspapers, cable TV, movies, sports games, and other "content".

I really hope it will work out considering the alternatives (going out of business, being subscriber-only).

alias kn 'killall -9 netscape-communicator'

Pay for ad free site?? (3.00 / 4) (#8)
by mystic on Tue Mar 20, 2001 at 11:15:04 PM EST

I don't know about you all, but I have been viewing Salon ad free for some time now, without paying anything extra. Try Internet Junkbuster Proxy.

I don't know what other bonus things Salon plans to give, but I am not going to pay for an add free site, and I really hope no one does too!

questions... (none / 0) (#9)
by Philipp on Tue Mar 20, 2001 at 11:21:21 PM EST

How do expect the site to pay its writers, given that advertising does not work? Who will pay for you enjoyment and enlightenment of reading it? Why not you?

alias kn 'killall -9 netscape-communicator'
[ Parent ]
Answer (1.66 / 3) (#15)
by mystic on Wed Mar 21, 2001 at 02:14:48 AM EST

Answer

[ Parent ]
That's not an answer (3.00 / 1) (#33)
by chriss on Mon Mar 26, 2001 at 12:11:00 AM EST

All you say is "I'm proud to be destructive". Check your head

Chriss

[ Parent ]
curious (none / 0) (#10)
by spacejack on Tue Mar 20, 2001 at 11:32:50 PM EST

Not that ads bring in enough revenue for Salon on their own, but why are you so proud of an action that can only help put the company providing content out of business? And why do you reject their only alternative -- a pay-for-use model?

I would really like to hear an explanation for your point of view. Do you want to see all internet content disappear?

[ Parent ]
Answer (1.66 / 3) (#14)
by mystic on Wed Mar 21, 2001 at 02:14:15 AM EST

Answer

[ Parent ]
Well... (5.00 / 2) (#23)
by ghjm on Wed Mar 21, 2001 at 04:12:09 PM EST

Back in the '80s I had an account at NCSU with Internet access. The Web didn't exist yet, you used Gopher and searched via Veronica. There certainly wasn't any advertising and the only thing I remember being Internet accessible and pay-per-use was Lexis/Nexus, which is still pay-per-use today - and doing fine, as far as I know.

The funny thing is, I haven't noticed a substantial increase in content quality since then. Today k5 and /. have some cool discussions. Back then, Usenet was spam-free and had volumes of high quality, well-written posts. Usenet in the 80s was actually better than /. and k5 today. You didn't have to compose your messages in a crappy little Web form. Your newsreader was vastly more powerful and capable than Slash or Scoop. Killfiles took the place of moderation, and were actually more functional because you could tailor your killfile to your own preferences. And though I don't know exactly why, it just seemed that the base quality of content was much higher quality than it is today.

Back then, nobody had the remotest concept that you could make money selling "content," even if you had a lot of it. Hell, even porn was free. However, in the late '90s many businesses were founded on the crazy and unproven--in fact, disproven--idea that if you put up a Web page with high-dollar content, somehow money trucks would beat a path to your door. Why? I don't know.

The problem isn't structural, it isn't the payment system, it isn't that "we've permitted users the expectation of free content," it isn't that reading an article on Salon without clicking on ads is somehow socially irresponsible (a thorougly bizarre notion if I may say so). It's simple economics. Let me elaborate.

Every business faces a demand curve and a supply curve. Both of these hit content producers pretty hard. The supply curve is how many units they are willing to produce at any given price. In the case of a Web site this is pretty simple: The marginal cost of supplying one more "hit" is so small as to be negligible, therefore producers are willing to supply the entire appetite of the market, whatever price they can get. What this means is that if any firm exists and is charging any given price, any other firm which believes its product to be equivalent is well advised to charge slightly less money; they will then capture the entire market. The race to the bottom ends when price equals marginal cost, which in this case is zero. Or in other words, no matter how good you think your content is, if someone else is giving away essentially the same thing, you can't charge for it.

The demand curve is how many units consumers are willing to purchase, at any given price. Obviously if a product is available for free, somewhere between few and none will buy it - but we already covered that problem. Consider the demand curve for the content industry as a whole, not for any single firm. If all content is free, people consume a lot of content - whenever you have some spare time, fire up a browser and read some damn thing, even if it isn't very interesting. Why not? However, the moment any amount of money is involved, consumers must make a value judgement; most of the time, the result of that will be "hey - I'm just bored, I'm not really interested in this, maybe I'll go walk the dog." So the curve between $0.00 and $0.01 falls off incredibly quickly. At least half the people who would click on something for free will not click on it if it costs even a penny. (I have no research to back this up - I'm just making an assertion based on my own perceptions. I'd welcome anyone to dispute it.) Presumably as the prices go up the demand falls off prety quickly.

So the question is, what's the total amount of money the _entire_ WWW could _possibly_ expect to earn through pay-for-content? I'll bet if you crunched the numbers you would get a remarkably low figure. Certainly far less than is being spent today by the content companies. And of course, having calculated the total value of Web content if the buying public were to pay for it directly (and assuming your calculations are correct), adding a layer of indirection (advertising) can't possibly increase the total value of the system.

So, quite frankly, _any_ pure content play is doomed, as a business. But that doesn't mean the Internet will cease to have valuable content. Businesses aren't structured to spend their time just talking to people; at the end of the day they have to sell a product. So without the content firms, we'll just go back to having people talking to people--which is really quite a lot more interesting anyway.

No big deal, unless you work for one of them.

-Graham

[ Parent ]
excellet post (none / 0) (#26)
by spacejack on Wed Mar 21, 2001 at 08:02:44 PM EST

That's a very interesting summary. I enjoyed reading that!

I have some additional comments...

Usenet in the 80s was actually better than /. and k5 today.

Actually I would argue that it still is today.. for certain purposes. If I'm looking for answers to a technical question within a specific field, usenet still gives me the best results. I only use a few game and graphics related groups but they are still populated by highly knowledgable veterans (and newcomers) with discussions on par with k5 (better as far as hard data anyways). And, bad as the interface was, DejaNews was my primary "I need help NOW" tool (I prefer Google's engine nowadays; hopefully their archive will eventually include pre-95 posts).

However, in the late '90s many businesses were founded on the crazy and unproven--in fact, disproven--idea that if you put up a Web page with high-dollar content, somehow money trucks would beat a path to your door. Why? I don't know.

Frankly, neither do I :) I do remember reading a Wired article a few years ago predicting something to the effect that "in the future, money will disappear; attention will be the new commodity". Typical Wired B.S. :) But I think a lot of people thought that -- that if you had a large audience, you would somehow magically stay in business. Out of.. goodwill..? I dunno what people were thinking.

...Or in other words, no matter how good you think your content is, if someone else is giving away essentially the same thing, you can't charge for it.

Precisely!!

So, quite frankly, _any_ pure content play is doomed, as a business. But that doesn't mean the Internet will cease to have valuable content. Businesses aren't structured to spend their time just talking to people; at the end of the day they have to sell a product. So without the content firms, we'll just go back to having people talking to people--which is really quite a lot more interesting anyway.

This is the only point I disagree with (or at least interpret differently). My own theory (perhaps I should call it fear) is that only a few of the big sites will remain. I have no doubt that small, let's call them "hobby" sites (like k5) for lack of a better term, will survive. Perhaps they'll scrape by on ad revenue to cover service costs, or donations, or goodwill, or sponsorship of some kind.

But as far as the "Internet for the masses" goes, I sometimes fear that only a few (or one) site of each genre will remain. I shudder to think that all our online news will come from CNN. But it probably won't -- CBC will probably continue its web presence serving Canadians, as will many countries' news sites. Their web presence is good for them. A very cool local TV station for example has a lot of user feedback devices, including this new "vote for the movie you want to see" feature. Some of their shows regularly broadcast emailed user feedback (and they've been doing it for several years now). This is Good I think. Have a look sometime if you're interested at citytv.com. If I'm gonna flip on the tube, I check their site for what's playing first, eg. a movie, then cross reference the imdb site for some reviews. I'm much more likely to watch a movie I know nothing about these days if I look it up and find it interesting. No doubt other TV stations do this as well.

It is a bit unfortunate in some ways however. Because what it means is that all the "old boys" will be in charge of the big internet sites (as if we ever really thought it would be any different.. :)


But I didn't intend my original question to expand so much :) My question really boiled down to this: If you like the content on Salon (personally I could care less about Salon; it's a US-centric pseudo-liberal-poser-intellectual snoozefest IMHO). But the original poster I was replying to said he reads it. From that I inferred that he liked it (which may be wrong; perhaps he only visits it to check k5 links). But if he does use the site regularly, I was merely baffled by his attempts to sabotage their revenue stream, not only for himself but recommend everyone else do the same. That's what I have a hard time understanding. Combine with the ultimate downfall of the new media upstarts like Salon, and it seems to me very self-destructive to Internet new media advocates to sabotage companies like Salon.

Is it just me? Doesn't this strike anyone else as being odd behaviour? :)

[ Parent ]
but ... (3.00 / 1) (#35)
by chriss on Mon Mar 26, 2001 at 12:44:54 AM EST

I agree with most of this post. But ...

.. I don't think pure players will be doomed. There's a large number of companies fighting for eyeballs today while offering very similar content. Their weapons are free access plus advertising, and this doesn't seem to work, so many of them will vanish. Some will remain and, the others being gone, be able to attract enough advertising to survive.

Some will have very special content and find a niche where people are willing to subscribe. I'm concidering O'Reillys safari for myself.

Some will find a way to make micropayment work for them, even if people wont subscribe. If you look at i-mode, you'll see that people are willing to pay per view for content. The web will move in that direction, at least partly.

As time passes, different models will evolve. Everybody yelled "subscription does not work, go eCommerce", then "eCommerce does not work, try advertising", now "advertising sucks, do xyz". Subscription works, eCommerce works, ads work. But not for everyone and everywhere, you'll have to find out what works for you. There's room for everything.

[ Parent ]
Predictable. (none / 0) (#27)
by pallex on Thu Mar 22, 2001 at 05:22:46 AM EST

"I would really like to hear an explanation for your point of view. Do you want to see all internet content disappear?"

I searched for "Junk" (buster) when i first saw this story, and knew i`d spot a reply like this somewhere!

Not content (disappearing), just adverts, like on tv (where i skip through them on video, or go to the toilet).

I`d be perfectly happy with the internet just having companies selling products, people holding discussions on Usenet & sites like SlashDot/Kuroshin etc, and whatever else can be supported for free.
It started out that way, didnt seem to be doing too badly. Now all of a sudden we need adverts, apparantly?! Peculiar!

I think its only a matter of time before we can use technology to remove the curse of adverts from television too.



[ Parent ]
misunderstood (none / 0) (#30)
by spacejack on Sat Mar 24, 2001 at 02:21:13 PM EST

I`d be perfectly happy with the internet just having companies selling products, people holding discussions on Usenet & sites like SlashDot/Kuroshin etc, and whatever else can be supported for free.

But that's just it -- those sites don't run themselves for free. Usenet does, but you have to ask yourself why people have flocked to weblogs, away from usenet.

Furthermore, I wasn't talking about what I want to see happen -- I'm trying to remain neutral here. I'm trying to point out the self-defeating nature of such actions. K5 and /. both survive on ads. If you take the ads away, they have no source of revenue to compensate the time & costs required to maintain the sites. This is assuming you or the other poster have any desire to see Salon or K5 continue. If you don't care if they survive, if you don't care if the ad-sponsored TV programs you watch continue, then sure, you can do whatever you like to thwart their profit motive. If everyone is successful at thwarting them however, they'll disappear. Simple as that. TV programming was non-existant until ads appeared; no-one could figure out how to fund the content until the sponsorship model was built.

Perhaps people would like to see all the ad-sponsored stuff go out of business; to see entertainment providers go back to the drawing board and come up with a pay-for-use system (I must admit this is somewhat appealing to me). However I haven't seen this desire expressed by the people intent on blocking ads; they typically reject ads and payment models (see the top-level post).

[ Parent ]
usenet does not run for free either (3.00 / 1) (#34)
by chriss on Mon Mar 26, 2001 at 12:22:40 AM EST

Content for usenet is mostly generated for free, but infrastructure is not. Usenet is mainly financed by four sources:

1) most of usenet is generated at universities and therefore paid by taxes

2) newsgroups by companies mostly are a part of their services and therefore paid by product sales

3) most news servers are hosted by ISPs and are therefore paid by online fees

4) deja.com is a part of google which gets paid by portals for it's searchengine. The portals themselves are mostly paid by advertising and try to shift this to sales/subscription etc.


[ Parent ]
They are joking, right? (2.37 / 8) (#11)
by cezarg on Tue Mar 20, 2001 at 11:59:18 PM EST

They have to be. I mean no offence to salon.com but their articles are rarely worth reading at the current pricetag. Just because something costs money doesn't really mean it's worth its price. I find the general idea of paid access to decent content appealing. There are techincal things need to be ironed out, such as payment methods. I'm probably the only person living in North America without a credit card so I'm probably a minority... I digress though. Let's just look at salon's today frontpage:
  • Florida releases chad-free ballot proposal
  • Bush rescinds water regulations
  • Texas prison escapees indicted
  • Unusual debate in White House shooting case
  • Mexico's President Fox appeals to Zapatista rebels
  • Senate passes campaign finance measure
  • U.S. not likely to send troops to Macedonia
  • Fed cuts interest rate by half-point
  • Librarians: Net filters foster digital divide
  • Tapes detail day Reagan was shot
  • Manhunt closes Mall of America
  • Sheep producers use llamas as guards
  • Stocks fall sharply after rate cut
  • Diabetes pills being tested on kids
  • Gene may promote schizophrenia
  • Olympic organizers accused of pushing Mormon religion on journalists
How many of these articles are you inclined to read? None? So I thought. I'm not a newspaper snob but I'd rank Salon.com right up there with such press publications as The Sun or The Daily Star. In fact in the UK there is even a competing tabloid of a similar quality that is handed out for free at underground stations. Who is salon trying to compete with here? Surely not with serious publications such as The Guardian which is obviously free of charge in electronic form. I'd say they are doomed to fail not because the whole idea is bad but because their content is so mediocre that noone will pay for it.

That's not Salon's content (3.50 / 2) (#12)
by HoserHead on Wed Mar 21, 2001 at 12:28:39 AM EST

Look two lines above the "chads" link on Salon's page, and you'll notice that it says "From the wires" - i.e., news, not original content. Criticise Salon's original content (in the table to the right of that one) all you want, but don't knock them for putting up with AP send them.

I personally find Salon's original content very enjoyable, and I'd consider paying for it (considering I'll be starting on a co-op job very soon that'll pay me very well). I don't know about anyone else, but I find it really quite enlightening, and sometimes touching (Cf. the current two-part article on divorce).

[ Parent ]

Hell, I'll pay 30 bucks... (1.00 / 1) (#25)
by VValdo on Wed Mar 21, 2001 at 07:48:32 PM EST

I've found Salon's stuff to be pretty good. The idiot who posted two parents up obviously hasn't read Salon if they can't differentiate between original Salon stories (generally really good) with generic AP stories. W
This is my .sig. There are many like it but this one is mine.
[ Parent ]
The AP wire feed isn't Salon content (none / 0) (#22)
by jaydatema on Wed Mar 21, 2001 at 02:30:51 PM EST

By the way, the stories you listed were just the Associated Press wirefeed, not original Salon content. I wouldn't pay (or read) these stories either.

[ Parent ]
Hm.. (2.50 / 2) (#13)
by mystic on Wed Mar 21, 2001 at 02:12:38 AM EST

You mean to say that there is some ad banner agency that pays for just eyeball? I have no intention of clicking on ads just to give Salon some more money.

I did not block Salon exclusively. Salon ads are serverd by avenuea.com. I had blocked them because a lot of sites carry their ads and they just clutter the space. Now that you have brough the fact of Salon struggling to get money to pay staff, I have allowed Salon's section of avenuea.com

Why do I feel proud of what I have done? - Well simply because I can do what I want to. If I want to block something from appearing on my screen, I can and it sounded ridiculous that a site like Salon was offering ad free site for a fee, when the know-how to do so exists.

I don't think you understand... (none / 0) (#31)
by MaximumBob on Sun Mar 25, 2001 at 03:07:26 PM EST

...that when you block a site's ads, they DO NOT MAKE ANY MONEY.

I don't know for sure if you have any idea how much bandwidth costs, but it's far from cheap. And in the case of a lot of sites (like Salon), they have to pay for their content, as well.

My point is that if you're going to read Salon with the ads blocked, I hope you're not disappointed when they go out of business. Because without a continued influx of money, they can't pay the bills, and they will go under. I'm not saying you should pay $30 a month for Salon. I'm not even saying that you should have the ads turned on. I'm just saying, for any site with ads on it, if you don't want to view the ads, don't expect the content to still be there tomorrow.

[ Parent ]

Fading into irrelevancy (4.50 / 2) (#16)
by Beorn on Wed Mar 21, 2001 at 04:53:42 AM EST

In theory this is kind of important, because Salon is still a popular site, and they wouldn't go down the road where Slate failed if it wasn't absolutely necessary. So this is an important experiment - can popular news sites charge for content, or does readers still expect to get everything for free?

But, hey, it's Salon. I used to read several articles each day, but I grew tired with their lax editorial policy (anything passes if it can be summed up in a "provocative" question-phrased headline) and general irrelevancy. Where are the hyperlinks? Pure text and in-house links only is a sign of panic and lack of curiosity. And wouldn't it be wiser to cut out the bottom half of articles, (the amount of new content every day is enormous), drop the non-text experiments, (audio?!), and focus on fewer, higher quality articles?

I don't know if Salon has gotten worse over the years, it might be that the rest of the web - the independent, inexpensive websites - has gotten better. I do know I won't miss it.

- Beorn

[ Threepwood '01 ]

Right-O (none / 0) (#21)
by Bob Abooey on Wed Mar 21, 2001 at 01:33:18 PM EST

I think I would pay $30 per year for a website that I really enjoy. Salon isn't it, but I'm willing to pay. I think this is where we will start to see quality in a website start to matter. If you want to stay afloat then you will need to generate revenue. In order to generate revenue you will need to charge for it, or perhaps ask for a donation. (yeah, that's the dremer in me... I've often wondered what would happen if I asked for a donation for my free software project... I mean you could still have the software for free, but if you use it and like it then mail me a $20...) So then, it boils down to the old school economy, you will have to compete on things like, quality, uniqeness of product, customer service, etc.

Of course you will still have the fringe free sites floating about, but for a slick proffesional type site you had better be prepared to pay. I'm a bit surprised that it took this long, a business has to make money at some point...after all they still charge for food at the grocery store.




-------
Comments on politics from a man whose life seems to revolve around his lunch menu just do not hold weight. - Casioitan
[ Parent ]
advertising is over (3.00 / 1) (#17)
by Seumas on Wed Mar 21, 2001 at 06:13:48 AM EST

The advertising industry is just starting to realize that advertising online is like throwing money into a fire. People almost never even pay attention to the ads on a page (and it's certainly easier to ignore an ad than pay a few bucks a month to avoid seeing it) and they actually visit or buy from the advertiser even less.

People are going to wake to something. They're going to wake up to the fact that the Internet serves two purposes. The first is an information service (massive library -- everything from book archives and weblogs to personal pages) and the second is a service (book sales, grocery shopping, buying clothes, providing access to copyrighted articles or music, personal ads, auctions, medical services, etc.).

When was the last time you walked into the library to find some information and ran into giant advertisements for the Aibo dog, C|Net, Pampers or other items all over the walls, doors, floors and on every page of every book? When was the last time you walked into a restaurant to have dinner and found advertisements for Sony or Ford plastered all over the tables, chairs, windows, plates and menus?

Ads will be out and service/information oriented sites will be in. I don't see any way that this can not occur, unless advertising agencies want to continue to throw money away.
--
I just read K5 for the articles.

Billboards (4.50 / 2) (#20)
by spacejack on Wed Mar 21, 2001 at 09:30:47 AM EST

One could say the same thing about billboards. A billboard might have even less chance with drivers since they're concentrating on the road. In fact, a billboard with more than about 5 or 6 words is a mistake since people can't digest it peripherally. A good banner ad can register with a viewer about as well as a billboard IMO. It's just that most of them suck -- I don't think any of the banner ad designers are any good.

For example, right now there's a fairly common IBM ad at the top. It uses the exact same blue as the K5 blue (coincidence?? :). But it pretty much fades right into the background. Sure, I've seen it about a thousand times but I couldn't for the life of me remember what it says or what it's selling, or even that it was IBM. OTOH, the WTF T-shirt ads that you see once in a while managed to burn themselves into my brain on the first viewing. Now, I personally don't want to buy a WTF t-shirt, but the recognition is the primary job of an ad. I doubt many people will buy a WTF t-shirt however because the product is stupid. What you need is an ad that a) sticks in your mind and b) a product that doesn't suck, and c) doesn't require a click-through. Only then will advertisers see the kind of results they do with other media.

I really don't think ads will disappear fully. But I do think the number of sites that can make any money off them will shrink dramatically; Sony, Microsoft, Barnes & Noble, etc. will always be willing to pay for space on big sites like CNN.com. Furthermore, the more sites that fall out of the tree in the shakeout, the fewer places marketers will need to place their ads.

[ Parent ]
taxes (4.00 / 1) (#24)
by snowjunkie2 on Wed Mar 21, 2001 at 05:39:58 PM EST

You don't see ads in a library because you pay taxes which support that library.
You don't see ads in a restuarant because you pay for the meals.
You don't see very many free newpapers / magazines because ads don't pay enough.

There are no, and never will there be any free lunches.
The sooner people realize this the better the internet and its associated businesses will be.


[ Parent ]
advertising wont be out (4.00 / 1) (#32)
by chriss on Mon Mar 26, 2001 at 12:05:26 AM EST

Ads wont be out. Neither a library nor a restaurant are really comparable to the web, because their source of income is usually not directly connected to the transfer of information. They finance themselves by taxes and sales of goods. A service web site for Ford will work this way, but a site like Salon will not.

The web is more like magazines or television. There are close to no magazines without any ads, because the price you pay for them doesn't cover the costs at all. There's pay tv, but most channels will carry a high percentage of advertising.

You can skip an ad in a magazin and switch to a channel that doesn't show a spot right now, and you can ignore a web banner. But most people will at least sometimes look at advertising, and this seems to be enough to charge large sums in mags and on tv.

Banners are in a bad position because it seems so easy to tell they do not work. You can't count clicks on tv, so advertisers have to believe it works. Maybe banners are the wrong format (see cnet), maybe they are to expensive, but after some time a format will be found that will be accepted by both viewers and advertisers. Maybe we'll see Micropayment aka pay-per-view, but a very large part of all media will continue to be paid by advertising.



[ Parent ]
Salon (3.50 / 4) (#18)
by Seumas on Wed Mar 21, 2001 at 06:19:09 AM EST

I only visit Salon when the occasional mention of an article appears here. In general, Salon has some of the most pretenious, awful writing you can imagine and their content is seldom better than a crappy People or PC-World magazine. Anyone who pays $30 for ad-free access is a moron (besides, in a couple more years, advertising will dry up and all information services will be ad-free or dead!). Hell, for $30 I can get a two year subscription to a hard-copy magazine delivered to my door every month with far fewer ads than most websites including Salon.

And how did Salong come to $30? Sounds like they expect to make a killing or something. Do they really think they make $30/yr off of each visitor? Unlikely. Even if they average a penny every time an advertisement is shown, a user would have to view about ten pages per day, every single day, for an entire year -- and I highly doubt they earn anywhere near a penny per page per view (or even a tenth of that).
--
I just read K5 for the articles.

Salon's stab at being a pay site | 37 comments (35 topical, 2 editorial, 0 hidden)
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