Free vs. Freemium at the Times

I got a couple comments to my Freemium post and My Favorite Business Model post that I'd like to respond to.

Rick Burnes said:

The way you've described freemium it seems like Times Select = A Big Freemium Experiment. Yet you're not a big TS fan. (Who is?) Does freemium work for content? Why does it make sense to wall off network calling on Skype, but not Nick Kristoff's columns?

And Jeff Jarvis said:

works in services, not content, i'd say.

Jeff is absolutely correct and he answers Rick's question. If your business is entirely about content, then you must offer your content for free and support it with advertising. You can offer the same content in more convenient forms as a paid service (email and RSS alerts, packaged without ads, archives, etc) but I believe you must make the content free or you will not maximize the audience and the value of the online medium.

I believe that the Times is making a mistake with Times Select. I've blogged about this in the past. The numbers may support their decision, it was an easy one to make since they never took ads in their columnist's pages anyway.

But I believe that putting up a wall between the online audience and content marginalizes that content and makes it less valuable. The online medium is all about links and you can't link to content that isn't freely available.

I do believe that offering services to the Times' customers such as crossword puzzles, archive search, photography archive, etc are great examples of ways to leverage the freemium business model and I just wish the TImes would focus on adding more services like that and take down the wall between their potential audience and their best columnists.

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Tracked on Mar 29, 2006 4:29:54 PM

Posted March 28, 2006 in Venture Capital and Technology

Comments

Fred, I think you're right about the Times. These columnists are not just there for enjoyment--they have valuable insights that should be free, and the columnists themselves don't benefit directly from the gates.

The Times could think of something, surely, they could charge for. But I think it should be something EXTRA to the paper, not the paper itself.

Posted by: Charlie Crystle | Mar 28, 2006 10:10:23 AM

Fred, what about mobile content? It's a multibillion industry, and the content is very rarely free. I've been working in the mobile content industry for 4 years, and while the products are changing and evolving, it seems that users can't have enough of it, and they pay pretty dearly to have smaller versions of songs, videos, pictures, games etc on their mobile phone... quite in contrast with the Internet model, I would say. For ringtones, we say that it's the opportunity to express your personality that matters, not the content itself... but, just to do a few examples, we licence and propose to users Java games, adult videos and pictures of celebrities, and they all sell really well for the user's own comsumption on the phone. What are your considerations about this? Why do you think we want everything for free on the Net, but we're ready to pay for the same content on our phone?

Posted by: Giordano | Mar 28, 2006 11:11:04 AM

I am avid "consumer" of content. I likely consume hundreds to thousands of free content pages online daily. However, my problem with free content being supported by ads is that so much of the ad support comes from search engine ads. This is a problem. If the search engine(s) sneeze your site and model suddenly catch a cold. It is likely more valauble to build both the content and advertiser relationship programs (i.e. direct sales channel) at the same time.

Posted by: Ishdog | Mar 28, 2006 11:16:03 AM

The most interesting point of this article is that the content actually *decreases* in value because less people can see it. In a lot of ways, I think this is the spirit of "information wants to be free". In fact, it wants to be available, and people should be willing to pay for it, either through their time (watching ads) or money (no ads if your time is valuable enough).

Posted by: Chris Neumann | Mar 28, 2006 1:41:52 PM

I heartily endorse Freemium having to do with adding service (or "value", though it's cliche) rather than additional content. Archives (though I broadly hate the pricing), mobile, rapid access (don't know if it would be legal, but so many people would pay $$$ for early crack at a big time publication...) etc.

What is vastly annoying is some of the pay sites that run a paymium model, where you already pay $$$ and then they want more for mobile content, etc.

What would be great would be an affordable price for individuals or small businesses to buy Lexis or Factiva subscriptions. Factiva has to be one of the best services in the world, but now that I'm not at big consulting firm I can't get it.

Posted by: annextraitor | Mar 28, 2006 2:23:47 PM

Networking: Wiring the small office
CHICAGO, March 27 (UPI) -- Computer networks can dramatically cut costs and improve customer satisfaction, but only for major Fortune 500 and Forbes 400 companies, right? Perhaps that was the case last century, but not anymore. Experts tell United Press International's Networking that technologies are now providing the same benefits to small and medium-sized enterprises -- and that this may be part of what is behind the productivity-based economic boom in the United States today.

"Today's small and mid-size companies are taking a cue from these larger organizations," Joe Hewitt, an expert on small and medium-sized business networking at Dimension Data, a Hauppauge, N.Y.-based computer consultancy, told Networking, "and are leveraging the power of technology for business advantage." By Gene Koprowski

Posted by: Ted Smith | Mar 28, 2006 7:57:06 PM

I'll take the Contrarian Bite here. The New York Times is doing the right thing with some walled content because 1. the competitive options for readers are not yet strong enough and 2. Their brand still beats the ability of search engines to direct content consumers to quality. They zoomed to a top 10 Podcast on iTunes right after being launched. They have market power. They should watch carefully and as soon as a small fry gets some traction, copy them and bury them. Here's an interesting podcast from Jon Landman, deputy managing editor at the New York Times. http://www.businessweek.com/mediacenter/podcasts/podcasting/podcastbiz_03_01_06.htm

However, the day will come that that strategy needs to change. I only found out about that podcast recently from Fred's own post at: http://avc.blogs.com/a_vc/2006/03/on_the_cutting_.html

New connections are being made, but I don't think now is the time for the NYT's to drop and run.

Posted by: Lloyd Fassett | Mar 28, 2006 8:52:39 PM

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