Cover Story: Making Content Pay
Hoenig's most interesting observation may be his view that publishers who believe Insider is a unique case because "sports people are crazy" are making a big mistake. "I think if I went out as a consultant for media people right now, I could select content that they have and say, 'This is what people would pay for.' People will pay for what Entertainment Weekly thinks about who will win the Academy Awards, or the Tony or the Emmy—they would pay for that. It's all a question of playing to that part of people's minds," he says.
"I got a call from our ombudsman about this a couple of months ago," Hoenig continues. "He had gotten a few letters, and needed to write about this [issue], so he said, 'Tell me, why do you think it's OK to charge for content?' Because stuff costs money! There's something about this that is so 'emperor's new clothes,' it just kills me. You've got a business, you want people to buy the product, some people don't want to buy it—[and that's] OK. Other people have got to pay for it. I don't understand the [question's] premise exactly. On some level, why are we so tentative about this?"
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Scientific American went from a long-standing tiered pay model to opening up its entire website for free, and has now re-embraced a paid content model. The company is in some sense a poster child for the recent shift in thinking back toward charging for online access, as it did everything "right" in driving audiences to its site (SEO, etc.) and was still faced with poor return on investment as revenue from Web advertising lagged, then sagged, in the face of recession.