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Let it Rain: Reuters and Dow Jones
Adapt to the User-Controlled Flow of Content |
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15 November 2004 |
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As Dow Jones makes away with its purchase of MarketWatch,
it's worth noting that competitor Reuters has been busy for
a while figuring out how to make good money with
ad-supported content on the open Web without a subscription
model. To profit in this environment takes an
understanding of how users are driving the content
monetization model more than ever before. But it's not just
ad-supported content providers that need to consider the
impact of this key deal. The issue of profiting from new
patterns of content flow is a universal issue for
publishers and distributors, one that has more than a few
solutions to consider. The key trick is to focus on
electronic content monetization as a destination feature
rather than a gating factor for delivery. |
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The
increasingly creaky analogy of content being like water flowing
through the pipes of technology fails to capture an era in
which content pipes linking precious headwaters to faraway
consumers have been replaced by an incessant rain of content
from the Web firmament. The issue these days is not how to get
content but how to get the rain that's everywhere into a useful
place. Context is the name of the game, a game that challenges
many fundamental aspects of publishing business models. Paid
subscriptions continue to work well for database publishers
when their content is truly unique and well-integrated with the
human needs of a community's users. But it's a forced context
that requires a lot of engineering by a publisher, engineering
that is easily obsolesced by the next widget or network of the
hour that makes the content more useful over "there" than the
"here" context that the vendor has devised. Channel
partners can help a publisher to keep up with this shifting
scene, but ultimately the value of a content's context is where
people other than its creators decide it should be - and no
waiting to iron out business terms, please.
In this environment the concept of having
a news Web site that requires a paid subscription to access
anything of use begins to look downright quaint. As Dow Jones
announces its acquisition of MarketWatch, Inc. its online
subscription site cannot be called a failure but it's hard to
imagine how one can grow an audience for subscription business
news when the company that you're purchasing offers nearly ten
times as many visitors for core business content to your online
advertisers - visitors that don't pay a dime for the honor. Dow
Jones rival Reuters had already figured out the value of
free-access advertising as a key source of revenue for its own
coffers. Under the tutelage of Reuters.com Global Head Azhar
Rafee Reuters tuned its online news distribution strategy to
draw more users to Reuters content without the help of
intermediaries milking their content for their own ad revenues.
Through search engine access, headlines via XML site feeds and
carefully selected channel partnerships Reuters is becoming
adept at getting its content into the contexts where it can be
monetized effectively. As Azhar noted in a recent
commentary on newmediazero, "It's simply unrealistic to
suggest you can control your content in digital environments
like the Internet. To protect the use of your content, you have
to understand and adapt to how it's used."
Put simply, let the content rain where it
may, but be there to collect the bill for its worth. In this
environment controlling distribution is not as important as
controlling the monetization capabilities once content gets to
where a user needs it to be. As Azhar notes in his piece this
means going with rights management capabilities in the long
run, but there's a lot of room for innovative business models
to push content profitably while the industry giants learn how
to create content objects that can respond to rights management
capabilities effectively. What are some emerging best practices
to consider for monetizing freely distributed content today?
Here are a few thoughts:
- Use ad placement technology for
content placement. Ads are content, of course, but too
many publishers have thought of the technology used to place
ads in Web pages as discrete from content distribution
strategies and channel partnerships. The only real content
that matters is the content that someone is experiencing
right now: the rest is just a collection of trees in the
forest waiting to fall and make a sound. Channel strategies
have the potential to be turned on their heads and
adopted to ad technology that allows content providers to
make the context of a given item's use the opportunity
to present content from other sources in that moment of use
with highest effect - at a price.
- Move more aggressively towards Web
services delivery. The ease and ubiquity of XML feeds
used for weblog delivery highlights the importance of being
able to make the delivery of XML-based content an
underpinning of publishing success. While there is some
potential for weblog feeds to provide more technologically
sophisticated content, the issue is not the wrapper but the
package within: weblogs are to date mostly about text and not
functionality. Publishers who service sophisticated audiences
need to consider how the benefits provided in XML-based
delivery of Web content can be extended more uniformly and
universally to include the delivery of complementary
functionality to users in objects that they can store locally
as easily as they collect text weblogs today. That's not
really what the majority of so-called Web services do today:
mostly they're just pipelines back to a central database. As
the digital objects delivered to content consumers get more
sophisticated, so will the opportunities for premium revenue
models.
- Prepare to provide more explicit
incentives for ad-hoc content redistribution. So far the
thought of user redistribution of content is viewed by
publishers as a threat far more than it has been embraced as
an opportunity. But what would happen if individuals and
institutions were encouraged to send your content
around instead of your competitor's? As content becomes more
about delivering digital objects it will become increasingly
important for publishers and distributors to consider how
best to accelerate the flow of content through the hands of
as many of the nodes in their consuming network as possible.
Yesterday's "air miles" may yet become tomorrow's "content
miles"...
The Dow Jones/MarketWatch deal is a
recognition by a major premium content outlet that betting on
freely available online content is no longer an option but a
necessity for ad-supported distribution. Reuters has been
moving in that direction aggressively for a while and now has a
newly-enhanced rival to consider. But both of these
competitors, as well as other premium providers, are still at
the very dawn of understanding how to push forward into getting
the most out of content that's emerging from the control of
yesterday's business models and finding itself in today's
user-dominated contexts. The winds of change are driving this
rain pretty hard these days.
-
John Blossom
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