http://shylockblogging.com/gawker-media-real-traffic-data-estimated-revenues-0813/

Wow, “stupid,” that’s pretty harsh — although I do appreciate your catching the errors, which I fixed.

Unlike many bloggers, I read through my posts several times before publishing, but I’m not perfect and unfortunately can’t afford to hire a copy editor, so I do the best I can.

In any case, thanks for the rant. Hope you feel better.

I welcomed your update above which recognizes that there is still a strong role to play for the paid content model in niche categories.

I still think some of the further conclusions in your update are perhaps a bit too general, however.

For example, “niche content businesses probably won’t scale.” Well, isn’t “scale” a relative concept anyway? I know of a wine expert who has several thousand subscribers paying £69/year each and now has several employees helping to run the website. Has this person scaled? I would argue yes, quite nicely.

What about the niche publisher that has built a collection of successful paid content websites? Surely they have scaled.

I wonder if your definition of scale is rooted in a mass media background and therefore to you this represents big numbers, and perhaps makes it more difficult to appreciate “scale” at smaller volumes. Scale depends on your cost structure, and if it’s low, then you can scale at lesser quantities.

Will niche paid content websites come under pressure from the radically changing economics of content? Well maybe — who knows what radical changes the future may hold? But I would argue that these niche sites are taking advantage of these changing economics. The means of production and of distribution are now affordable and accessible, and it has enabled these businesses to come into existence. They are the evidence of these radical changes.

Good content of course will survive as something entirely distinct from the means of distribution. Savvy and nimble content owners who recognize the value of their content assets ought to be able to take advantage of new technological developments.

What is wrong with big media today? They are not victims of radical change, they are victims of their own failure to respond and to execute. The internet was no surprise. I began my career 20 years ago at Newsday, working on some of their earliest online activities. Even then, we knew. But many chose not to listen.

Thanks for the opportunity to comment. I have only recently discovered your blog and I look forward to visiting more in the future.

Kind regards,
Evan Rudowski

Come on! This is becoming more and more of an issue as copy editing goes out the window and spell checkers are used instead of using people who know how to spell!

Thanks for the important clarification about niche paid content — I addressed this in an to the post update above.

You are right, Steve. Declaring the death of paid content is foolish.

People will pay, and do pay, for online content that is valuable to them, actionable, unique and from trusted sources (individual experts or brands).

Usually this is niche content that appeals to an audience ranging from a few as dozens to as many as tens of thousands of people. In spite of the fact that alternative free content may be available, people understand what is valuable in their own niche and if it provides them with real value they will pay for it.

There are dozens of paid content websites that generate substantial revenues for their operators (we know, because we’re in the business of providing the platform for such sites). They are in categories ranging from wine, to real estate case law, to dieting, entrepreneurship, preaching and anything in between.

The issue is not that paid content doesn’t work, but that (as in the case of the WSJ and Times Select) advertising may be more lucrative because of the audience size. It is a broad generalization to assume that paid content is broken just because these players may opt for a model that capitalizes more on their mass audience numbers.

For niche content, the subscription model works. If you want specific examples, please e-mail me — I’ve got loads.

Kind regards,
Evan Rudowski

I am hoping similar changes at WSJ. Check out my thoughts around this:
http://abhishek.tiwari.com/2007/08/02/wsj-its-makeover-time/

Generally, I agree with you – paid content is not a sustainable business model on the web. Yet, I would like to point out a few “caveats”:

First – ultimately, wsj.com has been able to charge for its content mostly because the subscription is a business tool (aka – “business expense”). Sure it’s best in class business content and sure it’s the best brand in its space, but don’t underestimate the power of B to B price insensitivity. (And, yes, you’re right wsj.com will inevitably be made free because they will make more money selling ads).

Second – NY Times Select was a nice try. Again, try not compare it to a B to B play, NY Times is deeply entrenched in the price sensitive consumer market where if they raised their paper delivery price by $.02 they would see a 10% reduction in unit sales. Yet, the decision to try to charge for Times Select was sound. Consider that the content thrown behind that wall was effectively impossible to market to advertisers (opinion/editorial does not sell ads no matter where its published), and consider that NY Times has zero problems generating page views and uniques. Therefore, why not try to monetize “popular” content? In fact, I would have liked to have seen NY Times try other tactics like bundling Select with other products/services or even lowering the price.

Yesterday analyst John Morton as quoted as disapproving of the shrinking Times as something that [paraphrase] just ought not to be done, the Times is too great for this, etc.

He of all people should realize that changes far more dramatic are coming to paper-based journalistic products, and sooner rather than later. The idea that the Times for some reason could/should resist is sentimental. This is not a good time for sentiment in the newspaper industry.

This is the only point I wanted to make, and of course you’ve made it. However, you might be surprised on how this can actually go the other way.

The Google traffic/Adsense model encourages untrustworthy crap, and buyer psychology values paid expertise. Also keep in mind that we bloggers are nowhere near normal people at all. We see the sky falling for content, but it’s not true in the real world.

I see niche membership sites that make good money selling information that is freely available elsewhere (and the bloggers providing it for free are making pennies).

I’m most well known for giving away free information at Copyblogger, but I make a living from selling niche information. And business is getting better, not worse. The Adsense model has killed the credibility of much of the free niche information sites out there, and therefore has ironically made credible paid information more desirable (if marketed properly, of course).

Thought-provoking post as usual, Scott.

Not true for WSJ, not true for Times Select. I am a Times Select customer, and it is some of the most consistently high quality writing I read on the web.

I consume great to crappy content elsewhere, and guess what? That stuff only increases my appetite for what the Times offers.

I was referencing an article that I read in print (imagine that!) and told my friend to look for it online using his Insider account. Nothing, zip, nada. Nowhere to be found. Now if they had it, and charged my a couple bucks for it I might have purchased it. That is if I didn’t still have the print edition (imagine that!) sitting in my family room at home.

@MJ, niche/highly specialized topics will be the last bastion of paid content, but those too may eventually fall, so long as there are at least 2 experts, and one is publishing for free

One question: As more and more free content is published, and more and more low quality content is published with high production values since the tools (such as blogging tools) continue to get better, won’t people need to go to brands to be sure what they are reading or watching is worth the time to read it?

Search has taken dominance because none of the editorially driven portals could keep up with the profusion of new sites coming online. But searching has an intrinsic cost — specifically the time it takes to tell if a blog or newsletter of comedy video show is any good.

In wealthy markets people routinely pay for time saving services whether it is house finders or personal shoppers. You would think this would happen online as well.

John