[ieatpaste]

This is basically the "pay what you like" monetization that Radiohead used - 60-65% paid nothing and the rest paid an average of $6 (30% of market price). Personally, I feel that this is not sustainable.

Newspaper monetization could be in the form of customized filtering. While many companies try to provide such a service, the quality isn't high enough that someone would pay from it.

[nfg]

> $6 (30% of market price)

30% of the price a consumer would have paid in the traditional model. In all probability even accounting for costs this represented a huge increase in profit per unit sold for the band itself.

[dcx]

I think your numbers sound about right. If you assume each user subscribes to 15 sites, that's 30c per site per month after transaction costs, so a special interest blog with a thousand visitors nets $1,080 a year. Semi-pro mommybloggers and the like get $20,000. BoingBoing at a couple of million unique impressions, $2.2 million.

That seems lower than one might hope for as a content producer but maybe higher than an average consumer might want to pay as per month - about the right number? It makes sense that as the market approaches perfect competition (no barriers to entry, no information inequalities, no transport costs) it gets pretty hard to make abnormal returns - supply just ramps up until there is less per head.

This could be a nice channel for incentivising content that doesn't work well with an advertising model, for example RSS feeds. It'll be interesting to see whether they can market this well enough though.

[brand]

How high does the quality have to be before the average user pays for it?

[ieatpaste]

This would depend on each user, but can be generalized with sufficient data. Filtering can be measured by average hours wasted. If filtering can give a user a relevant article of news within x amount of time, then it the user saves normal - x amount of time. If you multiply this by their hourly salary, then you get a good grasp of monetary amount. Get statistics regarding the ratio of money saved/hours saved vs paying amount and you probably get a good idea of pricing and the amount of people that would pay.

Ideally, I would get all news/articles relevant to me within 10 minutes and this would probably save me 50 minutes every day. Personally, I would pay if the service if saved me a significant amount of time and had the absence of articles of which I was not interested.

[tomjen]

The average user won't pay no matter how high the quality is if they can get it for free otherwise.

[Xichekolas]

Maybe I'm not 'average', but I pay $80/yr for a subscription to the Economist even though I can get all the articles free on their website.

Part of that is that I spend 12-15 hours a day on my computer for my job and side projects... being able to go outside and read my news on paper is a welcome break from that.

But the other part is that I find the reporting to be of generally high quality and depth. I think the print media that is hurt the most by the Internet are those with shorter stories and lots of ads in between. The Internet does this bite-sized content extremely well, so traditional media will have a hard time competing, but there is still demand for longer, in depth content, which is (so far) best supplied by paid reporters.

[ieatpaste]

I agree to a certain point: If the difference in quality contributes enough value added, the user to pay for the service. The availability of any competing service decreases the difference and makes it much more difficult to have the user subscribe to a premium service.

Hopefully, the premium-based-monetization services would make more money and expand faster than those with the free model.