A long, long time ago, when the online world was new and small and driven by idealistic developers, someone came up with the idea that giving online content away for free was a good thing.
The idea, at first, was to get popular with freeware, then after people appreciated the value of your original content, you could introduce a premium version and then you could charge.
For the most part, it didn't turn out that way. So many people produced so much quality content--content which almost always overlapped with other sources -- that it seemed unlikely that anyone could charge for anything at all.
This had happened before. Radio and television produced content that people liked. Instead of paying it a sponsorship model was developed and for a few online content providers this has worked quite well. But those providers are at the very top of the pyramid. They either have sufficient users to comply with the mass media models of broadcast media, or they have such a unique service such as search, that everyone is going to use it.
Traditional organizations found their old ways disrupted and have now universally migrated online. Some, like the Christian Science Monitor, once an acclaimed international newspaper now exist only online. Others, like the New York Times and Wall Street Journal have feet in both the online and offline worlds, although in time I imagine the cost for printing on paper will vastly eclipse the subscription, add revenue and demand to justify paper.
The Journal has maintained a subscription model for online that has been universally scorned. When its curmudgeonly owner argued that Google should share some of its ad revenues with content sources, it was vehemently chastised.
More recently, the NY Times, probably the #1 online news source worldwide, announced it was changing it's model to one that closely resembles what the Journal is doing. People in Twitterville jokingly bid the Times goodbye, saying that they could get their content elsewhere.
Likewise, Forrester Research has recently announced its erstwhile free analyst bloggers were being corralled and herded behind a corporate firewall, much to dismay and jeers by those who currently enjoy the content for free.
Perhaps all three of these semi-paid models will fail as has the earlier belief that they could survive on ad revenues alone. But ad revenues are not enough, and people get paid to research, write and edit this content. Much of it is not just original but it is valuable.
Then there are us bloggers. We are but a sliver of the problem for traditional media, but it has become a painful sliver. Worse we have started to feel the same pain. It has been noted several times recently that some of the most popular bloggers, such as Robert Scoble post a lot less these days than they used to. Steve Rubel, once the most popular of all PR bloggers has quit altogether as have several other formerly prominent bloggers. I do not enjoy the levels levels of popularity, but I too, blog less.
We bloggers talk about all the other social tools we use such as Twitter and so on. But the truth is that we too have to make a living and very, very few of us have figured out how to make a living at researching, writing and editing long and often complex content.
Some of us make some revenue because of our blogs, but not enough to justify what is probably more than a million blog words a piece for Scoble, Rubel and me.
My guess is that if independent bloggers cannot find better ways to monetize the practice, then these types of blogs are destined to atrophy and perhaps die altogether.
It comes down to this. People who invest time to produce something of value have historically been compensated for it and social media and online content have broken old models without replacing them with new modern ones.
I don't endorse what the Times, Journal and Forrester are doing. I doubt that these attempts will succeed. But I do sympathize with them. Scoble, Rubel and I have done just fine because of our starts in blogging, but the assumption that we have lessened or abandoned or activities because of other social media activities is only a part of what I think has happened.
Of course, I have no solutions to offer. But I hope someone does. A model based on not compensating those who produce valuable material cannot endure for very long.
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Look at how a (free) webcomic can support its author/artist. The online comic is free (though sometimes a higher resolution version requires a paid subscription, which is hard to apply to blogging). The merchandise, both electronic (e.g. desktop wallpaper) and physical (e.g. printed collections, original artwork, mugs/t-shirts/etc. with logos, posters, stickers, etc.), is what actually supports the effort. Yes, they usually still have ads (why not?). Yes, they have marketing efforts, e.g. attending cons, for the merchandise beyond just publishing the comic. But they get a following and monetize that audience without alienating or making them feel like they are being extorted. There will always be "moochers" who don't buy anything, but there is no harm in that as long as the compensation is sufficient.
For the kind of successful webcomic I'm talking about, I don't mean Penny Arcade or similarly HUGELY successful ones. I'm talking about something like Schlock Mercenary , which has been Howard Tayler's sole source of income for himself, his wife, and his three (I think) kids for several years now.
Innovation is mandatory in capitalism, and innovation cycles are rapidly increasing due to the constant disruption of new innovations and technologies.
I've been thinking alot lately about how exceedingly difficult it's actually become -- because if you're not moving forward, then you're moving backward. I have a feeling entrepreneurs will have to find new ways of partnering with other entrepreneurs to create new business models that make it feasible to help each other out in a complementary or interdiscplinary fashion. A relationship of this kind may be short-lived or lasting depending on the circumstance or need. Or it may be periodically revived across time.
Either way, it will require a different mindset and operating framework than the way entrepreneurs typically think.
Hi Shel,
We continue to wrestle with the issue of extracting value from the inordinate time required to author quality posts, and appreciate your writing about it.
I author two websites, my consulting site, on which I typically post once or twice weekly, and a laborious, not-for-profit, consumer advocating travel website (http://beatofhawaii.com) that I post on 4-5 times per week.
I've been a fee-based consultant for over 30 years with clients relationships that mostly predate "e"-word of mouth. Moving to Hawaii a decade ago, however, it has been difficult to develop local clients. A significant and truly unplanned and unexpected benefit of writing Beat of Hawaii has been in establishing local credibility and forming relationships with people and an industry here that might otherwise not have occurred.
Aloha,
Jeff
Thanks for posting this. Here's a take from the entrepreneurial side of the aisle. Marketing is a constantly changing animal. When anything is new, those who embrace it shoot to prominence. That certainly happened with blogging and social networking.
But (as I believe Chris Anderson's book FREE ultimately contends), free is NOT its own economy but a complementary aspect of the monetized economy. Like yin and yang, they are both separate and interrelated. But capitalism is about nothing if not constant change, so the relationship between free and paid inherently changes over time.
You, Scoble, etc. have much in common with other industries where the revenue models are changing. And this is where (as Seth Godin writes this week), our essential "job-oriented" thinking is unmasked, even though we call ourselves free agents.
We don't have jobs as bloggers. We are "entrepreneurs," and one of our biggest jobs is to figure out the value creation engine of our various independent activities (and change with the times). A lack of innovation is a stumbling block for small organizations, whether for-profit or non-profit.
There is no answer that exists out there a priori. There is only our individual creativity, business knowledge, and courage to create a content based revenue model that works in each of our businesses. We have to learn, apply, think, network, and work at it. THAT is our job.
FREE lists 50 potential business models for making money in a content-based undertaking. I am taking his list as my starting point for a section of the book I am writing.
I do know this from my days as a VP for Entrepreneurial Programs in an SBA-funded business education program: Learning to think like an entrepreneur is a lot more involved than it sounds....ideally, it is learning process that never ends. We all are smart, we know what we know....but every so often we have to put that aside and look afresh at how we exist in the economy. It's not easy but it is possible.
This is an incredible learning (and achieving) opportunity to not only solve our own financial/income issues but to also contribute to the US's post-recession economy. Recessions are where great changes are made and what I have outlined above is what I personally am committed to contributing.
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