A la carte ou pas?

Valérie-Anne Bleyen - Leo Van Hove

19 March 2009

Vrije Universiteit Brussel

SESSION 3: A LA CARTE OU PAS?

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OUR RESEARCH

- EVOLUTIONS IN THE ONLINE REVENUE

MODELS FOR ‘TRADITIONAL’ CONTENT

- 2 MAIN RESEARCH QUESTIONS (RELATED)

- FREE OR FEE?- ACCESS OPTIONS TO THE SITE?

OUR SCOPE: NATIONAL NPS - WE

• Period June-July 2006 and 2008• 82 newspapers > 8 countries• All national, daily paid-for newspapers

Belgium (9) - the Netherlands (8) - Luxembourg (6)- France (11) - Germany (10) - Italy (20) - Spain (8)- the United Kingdom (10)

• Listing conform WAN-report (2006) & nationalcoordinating organisations

• Not: - regional and local newspapers- freely distributed newspapers - overly specific target audience

DATA COLLECTION = SELECTIVE BUT EXHAUSTIVE

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AGENDA

I. DEFINITIONS

II. MAIN FINDINGS

III. CONCLUSION

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I. THE ‘FREE OR FEE’-DILEMMA

THE PHILOSOPHY BEHIND OUR APPROACH IS BASED ON THE NATURE OF THE REVENUE MODEL:

“DO NEWSPAPERS TRY TO MONETISE THEIR ONLINE CONTENT:

• DIRECTLY (by charging for content)

• INDIRECTLY (through advertising revenues)?”

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I. THE ‘FREE OR FEE’-DILEMMA

FREE

= COMPLETELY FREE WEBSITE

= ALL THE NEWS, COLUMNS AND

ARCHIVED ARTICLES (IF

AVAILABLE) CAN BE CONSULTED

FREE OF CHARGE

FEE

= SOME CONTENT IS CHARGEDFOR

- FEE LIGHT= only a charged-for PDF-version= rather ‘traditional’ approach

- FEE+= something else/more than acharged-for PDF-version

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I. UN-BUNDLED ACCESS OPTIONS

1. DAY PASS AND X-DAYS PASSA day pass gives complete access to the website for 24 hours. One can thus consult all the online articles for one day. A variant on the day pass method is the X-days pass, which gives access to the site for X number of days.

2. CREDITS-‘CARD’ (OR WALLET)Here the visitor of the site buys X credits at a certain price. With this card he subsequently pays one or more credits per article (often depending on the length of the article), after which the amount is deducted from the card’s balance.

3. PAY-PER-VIEWThis access option gives the opportunity to purchase and pay for articles on an individual basis.

BUNDLING

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AGENDA

I. DEFINITIONS

II. MAIN FINDINGS

III. CONCLUSION

II. MAIN FINDINGS: FREE OR FEE?

2006 2008 In % of tot a l

FR E E FEE L IG H T FE E+ FR E E FEE L IG H T FE E+ BE 11.1 33.3 55.6 22.2 33.3 44.4 NL 25 37.5 37.5 12.5 37.5 50 LU 33.3 16.7 50 33.3 66.7 0 FR 9.1 9.1 81.8 18.2 18.2 63.6 DE 20 40 40 10 40 50 IT 30 15 55 35 30 35 E S 0 25 75 25 25 50 UK 20 20 60 40 40 20

TOT 19.5 23.2 57.3 25.6 34.1 40.2

• 32 out of 82 nps ∆ strategy• Evolution 1: Move from FEE to FREE

- 23 towards FREE; 9 towards a paying site- FREE nps (country level: everywhere except in NL and DE)


2006 2008 In % of tot a l


TOT 19.5 23.2 57.3 25.6 34.1 40.2

• Evolution 2: Within FEE, a move from FEE+ to FEE LIGHT

- FEE LIGHT (country level: nowhere a decrease)- FEE+

• 2 evolutions go in same direction

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2006 2008 In % of tot a l


TOT 19.5 23.2 57.3 25.6 34.1 40.2

• On a country level:

BE: 77.8% S.Q. NL: 75% S.Q. 11.1% FEE LIGHT towards FREE 12.5% FEE LIGHT towards FEE+ 11.1% FEE+ towards FEE LIGHT 12.5% FREE towards FEE LIGHT

II. MAIN FINDINGS: SUBSCRIPTIONS VS. PPV

2006 2008 In % of

total N.A. ON L Y ON L SUB

ON L Y UNB

BOTH N.A. ON L Y ON L SUB

ON L Y UNB

BOTH

BE 11.1 33.3 0 55.6 22.2 33.3 0 44.4 NL 25 12.5 12.5 50 12.5 37.5 0 50 LU 33.3 33.3 0 33.3 33.3 66.7 0 0 FR 9.1 27.3 9.1 54.5 18.2 18.2 9.1 54.5 DE 20 40 0 40 10 50 0 40 IT 30 35 0 35 35 45 0 20

E S 0 25 12.5 62.5 25 37.5 0 37.5 UK 20 50 0 30 40 50 0 10

TOT 19.5 32.9 3.7 43.9 25.6 41.5 1.2 31.7

• Disappointed about the unbundled access options • Become either completely FREE or offer only online subscriptions

Day pass: BE: 55.6% 33.3% NL: 0% 25%PPV: BE: 0% 11.1% NL: 37.5% 25%

II. MAIN FINDINGS: SUBSCRIPTIONS VS. PPV

• Unbundled popularity • Online subscriptions in NL and DE (cf. supra)

2006 2008 2006 2008 In % of total

ON L IN E SU B SCR IP T IO N S UNBUND L ED ACC ESS

O P TION(S) BE 88.9 77.8 55.6 44.4 NL 62.5 87.5 62.5 50 LU 66.7 66.7 33.3 0 FR 81.8 72.7 63.6 63.6 DE 80 90 40 40 IT 70 65 35 20

E S 87.5 75 75 37.5 UK 80 60 30 10

TOT A L 76.8 73.2 47.6 32.9

Aggregate figures:(if 2 alternatives available, appearance in both categories)

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II. MAIN FINDINGS: THE ARCHIVE

• More than half now have a FREE archive • 8.5% of sample still does not have an archive yet• BE: 22.2% abandons it NL: 12.5% free 12.5% fee

2006 2008 2006 2008 2006 2008 In % of total FR EE ARC H IV E PA ID -FO R ARC HI VE N.A. BE 44.4 33.3 55.6 44.4 0 22.2 NL 62.5 62.5 37.5 37.5 0 0 LU 50 66.7 50 0 0 33.3 FR 18.2 27.3 63.6 72.7 18.2 0 DE 60 50 40 50 0 0 IT 45 55 40 35 15 10

E S 50 50 37.5 50 12.5 0 UK 60 80 20 10 20 10

TOT 47.6 52.4 42.7 39 9.8 8.5

II. MAIN FINDINGS: THE ARCHIVE

• “Trial and error” approach? 8 sites from FREE to charged-for

11 from charged-for to FREE 6 sites started with the offering of an archive 4 nps simply removed it

2006 2008 2006 2008 2006 2008 In % of total FR EE ARC H IV E PA ID -FO R ARC HI VE N.A. BE 44.4 33.3 55.6 44.4 0 22.2 NL 62.5 62.5 37.5 37.5 0 0 LU 50 66.7 50 0 0 33.3 FR 18.2 27.3 63.6 72.7 18.2 0 DE 60 50 40 50 0 0 IT 45 55 40 35 15 10

E S 50 50 37.5 50 12.5 0 UK 60 80 20 10 20 10

TOT 47.6 52.4 42.7 39 9.8 8.5

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AGENDA

I. DEFINITIONS

II. MAIN FINDINGS

III. CONCLUSION

III. CONCLUSION

• Evolution 1: FEE FREE• Evolution 2: FEE+ lighter revenue models

– PDF = low-cost, minimal-effort strategy (print content is digitised ‘as is’)

• Increasing aversion against unbundled access options– Nps that still opt for a FEE+ strategy prefer subscription

formulas

• Archive: free to attract visitors/ad revenues vs. a strict ‘walled-garden’ approach

Chicken-and-egg problem ?

Innovative payment instruments ∞ Unbundled access options

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Thank you for your attention

Further questions: [email protected]

Business

A la carte ou pas?