The Paywall: Get used to it

CrunchGear post by John Biggs on July 8, 2010

It can be argued that this has been the Decade of Piracy. Whereas media piracy existed as a scourge for millennia (Bach was totally pissed when PrisM posted the pre-release sheet music to the ‘Das Wohltemperirte Clavier’) the rise of the MP3 and other media compression formats – not to mention the release of the iPod in 2001 – brought piracy into the mainstream. I knew we were in trouble when, in 2002, a normally luddite professor of mine mentioned downloading lots of Bluegrass music from Napster.

It was also an unlucky coincidence that with the rise of piracy came a considerable contraction of the traditional distribution models for media and the Internet started eating everyone’s lunch. Users – and I mean all users and not just nerds – expected everything for free as in beer. While many will counter that users expect things to be free as in freedom, what they really want is free stuff and they want it all the time.

Case in point: you’re reading a free article on a free website paid for by the largesse of advertisers. If I told you guys to send me a nickel right now (my PayPal is, incidentally, so hook it up), you’d tell me to micturate up a strong line. The Internet is free! Why should I pay good money for the ravings of a lunatic?

This is, however, no longer. For example, Time magazine is now behind a paywall and I suspect a number of other organizations will follow suit. An App Store model of content delivery is coming and it’s coming quickly. Another case-in-point: The Onion’s $1.99 funny Future News video, an excerpt which appears above.

The decade of piracy, at least on a large scale, is over.

Why? Because pirating has gotten harder than not pirating. While torrents and other services are simple to use, folks in control of the “release” scene have created walled gardens like the late Oink where they trade video with reckless abandon, locking out the rabble who usually ruin everything anyway. The rest of the schmucks on the outside have to suffer from intolerably slow download times and no guarantee of quality while the l33t hax0rs are forcing folks to actually pay for trackers and NZB services, albeit something like $10 a year.

But folks don’t have to pirate. Now that you can simply point your remote at the TV to watch a new movie on Netflix, why download the movie onto your laptop and then figure out some way to drag it to the TV? When you can go to the iTunes store or Amazon to download high quality MP3 singles, why get them from the Pirate Bay? And, when folks like Popular Mechanics offer an amazing iPad app that marries their content with an interactivity that boggles the imagination it means that almost anyone can do it and, with a bit of effort, do it well. And the best part is that it only costs $1.99.

In short, micropayments are here, they work, and they will make up the bulk of media revenues in the next decade. Say what you want about the power of piracy – the laziness of the average user matched with their desire for new content will drive a paid content revolution.

My remarks & opinion!
Looking at the post above it is my opinion particular user groups are oke to pay for content. But this is à small number of consumers. Conversion I know are around 5%.

So what about the 95% of consumers who are not willing or able to pay. They are better serviced with à freemium business model or à business model based on freemium but you get access to the full version after you make a full payment or complete a short registration process and optin for some sort of performanced based Ad model. Like survey questions or co-registration.