They Pay for Cable, Music and Extra Bags. How About News?; The New York Times, 4/7/09

Via The New York Times: They Pay for Cable, Music and Extra Bags. How About News?:

"Just a year ago, most media companies believed the formula for Internet success was to offer free content, build an audience and rake in advertising dollars. Now, with the recession battering advertising online, in print and on television, media executives are contemplating a tougher trick: making the consumer pay...

“People reading news for free on the Web, that’s got to change,” Mr. Murdoch said last week at a cable industry conference in Washington...

But from networks selling downloads of TV shows, to music companies trying to curb file-sharing, to struggling newspapers and magazines, the make-or-break question is this: How do you get consumers to pay for something they have grown used to getting free?

Some industries have pulled it off. Coca-Cola took tap water, filtered it and called it Dasani, and makes millions of dollars a year...

All of these success stories offered the consumer something extra, even if it was just convenience...

“With downloads, the benefit is that the paying services allow you to sample many songs free, and you know it’s legal, and the TV shows have no commercials...

The free-versus-paid debate is a recurring one. At the birth of the Internet many sites charged for content, but by the late 1990s the prevailing view was that market forces favored free content...

Getting customers to pay is easier if the product is somehow better — or perceived as being better — than what they had received free."

http://www.nytimes.com/2009/04/08/business/media/08pay.html