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How Free Content Has Damaged the Content Industry

  |  November 8, 2001   |  Comments

The idea that content is cheap and easy to produce is pervading our society, but this misguided mindset is sure to result in a major shakeout.

A recent report from Forrester Research says that people who use the Internet are reluctant to pay for content. However, a previous report by Forrester found that a majority of people thought that the quality of the content on the Internet was poor. People want quality content, but they don't want to pay for it. That situation is a circle that cannot be squared.

To understand content on the Internet, we need to recognize that there are two distinct types. First, there is content provided by traditional publishers whose very business model depends on generating revenue from this content. This they do through advertising revenue, subscription fees, or both.

The second type of content is that which supports an organization by helping to sell more products, enhancing the brand of the organization, or both. This is the most common type of content available online. The revenue that such content creates is indirect, and thus the publication of such content is not affected by an unwillingness of people to pay.

However, the pervasive "content should be free" attitude is undermining the very nature of content itself. Because content is constantly associated with being free, a sense of content being cheap to publish -- and therefore of little real value -- is growing within business and society.

The whole Napster saga was a good illustration of how the idea of content having value is being undermined. People who illegally swapped music files quickly claimed that it was their right. They claimed that the music industry was corrupt and therefore it was OK for them to steal. Music groups who tried to prevent the stealing of their music were branded as greedy and anti-fan. Suddenly, music was meant to be free.

As anyone who has ever been involved with content knows, creating quality content is a very expensive and time-consuming process. Content is never free to create and publish. The reasons why so much content has been free on the Internet up until now are as follows:

  • Content has been used to sell products or enhance the brand of organizations.

  • Internet content publishers applied an unworkable business model, which predicted that advertising alone would support a content business. The gaping hole in such business models did not become obvious until the venture capital money ran out.

  • Many online content businesses were heavily subsidized, having had access to content and other resources from an offline media business.

  • Online subscription models have been difficult to implement. Pay-as-you-read models are not available because digital cash never arrived.

A product or service is only worth what someone is willing to pay for it. Right now, people are fixed on the idea that Internet content should be free. We are thus caught in a vicious circle. As long as people are not willing to pay, there will be a continuous decline in the overall quality of content found on the Internet.

At some point, perhaps two years from now, a bottom will be found. More and more quality content resources will have either closed down or gone to a subscription model. Enough people will become willing to pay, after they get sick of wasting time clicking their way through oceans of free, mainly poor quality content.

It has to happen. Quality is quality, and quality costs.

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ABOUT THE AUTHOR

Gerry McGovern Gerry McGovern is a Web consultant and author. His most recent books are Content Critical and The Web Content Style Guide, published by Financial Times Prentice Hall.

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