Would You Pay for a Web App That Delivers the News?
Can you imagine a news-delivering web application so compelling that you would pay a couple of dollars per month for it? What would it look like? That's the challenge facing The Reynolds Journalism Institute at the University of Missouri. They're working on a project called "Information Valet," which hopes to save the failing newspaper industry by finding a way to move news journalism online while making it profitable and sustainable.
The Information Valet Project
As more and more newspapers crumble, there is concern that we will lose major sources of vital news and information. The threat of online news, which is both abundant and free, has turned this industry on its head, forcing companies to come up with new models for making money. But which of those models will end up working is anyone's guess at this point. Some models are attempting to use crowdsourcing to pay reporters' salaries, while other companies are finding their niche as hyper-local sources of information. The new Information Valet project aims to do both and more.
With the Information Valet Project, paying customers wouldn't just get a simple web page dedicated to news. Instead, the project would deliver "a 24/7 platform-agnostic nerve center that finds, organizes, shares, and makes sense of information from a vast array of paid, volunteer, independent, and partisan sources - and then serves it how you want, when you want it."
What makes this project different than any ol' customizable web portal like iGoogle or My Yahoo, will be the way you pay for its services with your attention. In addition to the small monthly fee, the service would manage your attention to deliver premium content. So for example, when you look at an ad, that would create a payment that would be credited to an account where it will go to offset your purchase of premium content later on. This model effectively makes attention the currency with which you make your purchases./
In addition, the Information Valet will offer a one-stop shop of sorts for all your web registrations across the web and a safe and secure place where your privacy is protected.
So, It Does What Exactly?
If you're confused as to how this project is anything new or different than the news offerings out there today, you're not alone. There are so many different pieces to the project, it's kind of hard to get a grip on what exactly it is. The best explanation we found so far comes from Martin Langeveld, who described the various aspects of the Info Valet project as follows:
Content consumers/web users:
- Would register their personal data via InfoValet and would, in a secure system, retain complete control over who could access that information.
- By doing this, they would also gain the convenience and security of not having to enter a raft of data over and over each time they register at another site to access information or make purchases. Their personal information would reside in only one place on the web.
- In return for allowing selective access to their personal data, they would gain two important benefits: (1) access to information more tailored to their demographics, needs and interests, and (2) a system of rewards in the form of cash or points based on their web usage and exposure to advertising content. These rewards would be greater if they are willing to share, selectively, a larger amount of personal information with advertisers for targeting purposes.
Content providers including newspaper web sites:
- Would act as portals through which content consumers initially sign up for InfoValet. As such they could gain a share of future transactions, including ad-viewing rewards, associated with individuals they have signed up--even when those users are elsewhere on the web.
- Would be able to sell and host advertising targeted more precisely at site visitors by means of InfoValet registrations
Commercial content providers/advertisers:
- Would benefit from more efficient, better targeted ways of advertising to InfoValet registered consumers, published through "trusted nodes"--local brands through which consumers have signed up for infoValet
- Could send new, more welcome forms of commercial content to InfoValet consumers
Could This Work?
For something like this to succeed it will take a good bit of effort. Internet users are used to information being free, and will balk at the idea of having to pay for it. The additional services that make this project compelling and valuable will also have to be easy for the average internet user to understand, and - let's face it - we're not there yet. However, as news giant Rupert Murdoch recently stated, the future of newspapers goes beyond dead trees. In other words, now may not be the time to summarily dismiss new ideas such as this without first giving them some serious thought. The current business model for newspapers may not be working, but we've yet to develop what the next model may be. Could this be it? We'll have to wait and see, but at the moment it looks like an uphill battle.
You can learn more about the Information Valet project here, read the summary PDF, or view the PowerPoint.
Comments
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Based on the way it's been described in the blog post - no, I wouldn't pay for it. Now, if the news were delivered by Jessica Alba... that would be worth some dough.
Old as the hills. I worked on this very thing for a long failed and buried startup - Connectsoft in 1997-98. We even had a client - HP I believe, who even went so far as to make a TV ad based on the product/service.
Time wasn't quite right then. Don't know that I see it happening now either.
Good luck though!
JB
I think that news could generate it's own revenue though advertisements, so no I wouldn't pay for it. If you provide a great source for news online, you're going to get more exposure than you would with print news. With targeted Ads, like mentioned above, they could even increase their click-through counts or increase Ad rates. I'm not one of those who would pay to remove Ads, but there are plenty out there who would, so they could leave it up to the users. That is, if the user can't find it elsewhere for free. :)
like an RSS - no
Posted by: sofarsoshawn
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December 10, 2008 8:39 AM
No doubt, it's an interesting concept but I like many others (whether they wish to admit it or not) have become far too spoiled by the status quo. I'm not inclined to pay for something that I already get for free, simply by subscribing to the rss feeds of publications/agencies that interest me. While I like information to be at my fingertips as needed, I don't need my news spoon fed to me.
Compensation or not, I'm still raising a brow at being fed ads along with a premium service. I'm sure that doesn't bother most people but I happen to abhor them, so I'm not likely to pay for anything that doesn't give me a choice about being bombarded by them.
Nevertheless, it is an interesting concept. I just wouldn't be one of the first people to hop on that particular bandwagon. I do wonder though, does this view put me in the majority or minority here?
For me, the key to a news service being worth paying for is the depth and quality of writing. News on the internet is too focused on immediacy, and not enough on depth. That's why despite being online all day, I still find a printed newspaper (The Guardian in UK) my most reliable source of information. More so than the website of the same newspaper, which is good, but not as detailed.
If done really really well, I'd pay for it. Google Reader does a pretty darned good job of this, so they'd have to significantly improve upon that experience. Judging by their terrible 1980's logo, they're not off to a good start.
I'm not sure this is a step in the right direction. There may be a small subset of users that would be willing to shell out a few bucks a month, but it seems like there are too many free alternatives for a model like this to attract the masses. The proposed rewards program is interesting, but I would question whether it actually delivers any real value to either users or advertisers.
Free or GTFO
Posted by: fac287
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December 10, 2008 9:28 AM
Sounds pretty lame to me -- it offers no advantages that I could see to current online news acquisition - mostly disadvantages and you have to pay for it. An idea whose time will never come imho.
Posted by: Brian Sullivan
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December 10, 2008 9:31 AM
the news is really the olds, and just a cry for help .. best avoided
Posted by: Gregory Lent
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December 10, 2008 9:36 AM
Like Google Reader? Uh, no
Posted by: Jason Kaneshiro
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December 10, 2008 10:10 AM
nope
Posted by: ani625
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December 10, 2008 10:14 AM
So no one wants to pay for any news, *ever*? We're in a golden period of free where the quality we get for nothing is not sustainable with current business models. Either people are going to start paying (in some form or another) or the quality and number of sources are going to go down.
Posted by: mikepk
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December 10, 2008 10:23 AM
Are you willing to have ads in your feeds / pages? How often do you look at / click advertising? If you're like me you mentally filter out all ads (or have an ad blocker installed). I also believe if this need for things to be free continues, ads are going to become a lot more aggressive than they already are.
Posted by: mikepk
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December 10, 2008 10:25 AM
@mikepk: I agree with you that the current business model is unsustainable with the current demand for "free" content/news. Playing devil's advocate here a bit, I think one possibility is that we could see a decline in "quality" but an increase in sources as people shift away from the more traditional sources of news and to the social web. The role of the traditional newspaper reporter will be replaced in part by regular individuals posting information to the web real-time via their phones and mobile-devices as events are happening. Bloggers and Tweeters will be the new reporters and correspondents.
This transition has already started actually; the Telegraph has a great article how the social web came into play during the recent attacks in Mumbai.
http://www.telegraph.co.uk/news/worldnews/asia/india/3530640/Mumbai-attacks-Twitter-and-Flickr-used-to-break-news-Bombay-India.html
Short term though, I think we'll probably see more and better targeted advertising from the mainstream media. People have already grown accustomed to getting their information for free, and the younger generation, who are currently growing up in this "golden period" of free info, are absolutely going to expect it.
I'd pay to talk to the reporter directly, over the phone. I think every online news article should have a button -- click here to speak to this reporter for 2 minutes for $xxx.
Either people are going to start paying (in some form or another) or the quality and number of sources are going to go down.
I don't think that is true. Most of the sources for what appears in the newspaper and other MSM are public relations operations outside the news media. The public relations business is much larger than the news business and they get paid to deliver their clients news and information. As the MSM declines, they are going to figure out ways to get their content/news/information into the hands of the public.
The successful new media are going to be the ones that figure out how to organize and vet that content. Which is really the primary function of the MSM now.
Still waiting for the vision behind "Amazoning the News", which was what, 8 years ago?
This may signal a new trend in reporting for RWW, i.e., covering what are essentially research projects (and a university research project, no less).
And, in fact, it must be evaluated as a research project. After all, how many web services are launched with absolutely no apparent business model other than some mystical, magical stream of future ad revenues? Yet, I wouldn't expect a university research project to have figured out their revenue model, after all, that's not really what their research program is all about.
I applaud their efforts and we need a lot more efforts like theirs. (On a good week, I'll come across at least a couple/few dozen research papers that -- in a very broad sense -- cover the same scope of research endeavors.) So everyone who is so critical of this needs to consider that it's a university research project, not a commercial venture. The fact that they're even thinking about rev models is laudable.
So, is there a rev model? Possibly. One option is to offer some premium content. No, I don't mean like the failed walled sections of the New York Times and Wall Street Journal. What I mean is something that is truly premium content. Example: Personal finance information, such as an investment advisory newsletter.
Let's play out this scenario. There's a $100 per year newsletter that I'd like to get, but I can get it bundled in a news package for $3 per month. That's a pretty good deal! (There could even be a way to work in trial subscriptions into this model.) So, it's a split revenue model, with the "host" getting $2 per month and the newsletter getting $1 per month. OK, $12 per year versus $100 per year seems like a lousy deal for the newsletter, but I suspect that they'd reach a helluva lot larger audience and actually get much more revenue due to the larger subscriber base. And a larger subscriber base means more appearances on CNBC (maybe), which leads to more subscribers, seminars (even on cruise ships), you get the picture.
This may also work with medical information, such as bundling one of the many paid medical newsletters (HMS, Tufts, Mayo Clinic, many others). In essence, for the price of a newsletter (and maybe for less), a subscriber gets some premium content actually worth much, much more than the mere $36 per year subscription price. In fact, it makes economic sense to get a subscription just to get some premium content at a discount! And if enough subscribers buy into this concept, it will likely lead to much higher revenues for the premium content producers.
Of course, there's also the value of better filtered information. In an age of information overload, we geeks shouldn't be so dismissive of the value of filtered information. We may like to peruse hundreds of blogs, but Main Street doesn't. (Let's be honest, most people still don't use a feed reader. If they read a blog, they still do so by going to its site, maybe through an email subscription option like FeedBlitz or via Feedburner's email option -- and don't really even know how or which service is handling the email distribution of the blog posts that they want.) And, here's my challenge: Does anyone really think that Google News alerts are a good way to filter information? I certainly don't, and I receive many, usually with fairly complex search syntax (in order to narrow/filter my searches as best as possible). Custom Search Engines are a move in the right direction, especially when they can generate their own feeds. But perhaps the RJI solution can provide better -- or ALTERNATIVE -- filtering. I wouldn't be surprised if ALTERNATIVE approaches become commonplace. In other words, using different services because they provides different filtering mechanisms. One may rely on semweb, another on citation analysis (more like Google), perhaps even on different flavors of the same thing (e.g., different semweb approaches; they're hardly all the same or created equal).
So, there you have it: A viable business model, based primarily on "better" filtering + premium content.
Great comments -- appreciate the feedback on the Information Valet Project. A few toughts:
-- Asking people to pay for undifferentiated national/international news is certain a non-starter.
-- The value provided has to be much more than just news -- that's a loss leader.
-- However, local news is generally not a commodity.
-- So if a local (or topical) information provider can be a subscription-based home base, and can provide the consumer a method to protect (and profit) from their demographic privacy, and help the find information that's relevant to getting through the day (not just news), and provide access to music, video, services that are **not** free even today in some cases -- is that getting closer to something that has enough value for people to pay for.
-- We've just uploaded a video stream of the Friday morning session of "Blueprinting the Information Valet Economy," recorded Dec. 5, 2008 at the Donald W. Reynolds Journalism Institute, Missouri School of Journalism, Columbia, Mo. I encourage you to watch it -- the discussion is nuanced -- help out:
http://www.ustream.tv/recorded/962984
Also, please join the Google Group on this topic:
http://groups.google.com/group/infovalet/
-- Bill Densmore, Fellow 2008-2009
Reynolds Journalism Institute
(573) 882-9812 / densmorew@rjionline.org
I've been using Dow Jones' Factiva service for many years. Costs a fortune, but is an incredibly useful tool. Hard to see how Information Valet could be any better other than price.
I wouldn't pay for news, but I would pay for a smart filter, and suggested news sources.
Wrote about it here, but as more people get completely swamped by all the information floating on the web, the value of a personal filter goes way up.
http://lifeinlists.com/2008/09/the-branded-filter/
Google reader is doing a pretty good job of doing this, but I think theres room to improve.