A Second Wind for Paid Content?


Paid content was seriously out of vogue for a while, but right about now it seems due for a comeback. As TV distributors, starting with cable companies, feel enough pressure on their businesses to entertain ideas of “TV Everywhere,” and consumers become more aware of the costs of digital goods, I think we’re headed toward a fresh set of legs for paid online video.

Besides iTunes (s AAPL), the long-time paid video model, subscription systems for premium content (like MLB.tv) and ease of use to library content (like Netflix Watch Instantly) (s NFLX) are becoming seriously appealing. And paying for only what we want to watch has more resonance than ever before. These days we identify more with shows and stars than with networks, given the rise of social media, celebrity culture and other modern tools for fandom. And ever-more-digital-savvy consumers seem to have general awareness or even sympathy about how free content diluted the news business model, so they may just be willing to open their wallets.

TV distributors like Time Warner (s TWX) have picked the right climate to offer a souped-up, subscribers-only version of Hulu. They still have to execute, sure. And if someone were to come along with the same service for free? Well, the paid business model is hard to defend. But right at this very moment, the timing could be exactly right for digital paid content.

If it sounds like I’ve rehearsed this argument before, I have — because I wrote it up as a longer feature for our new paid research service GigaOM Pro. (I also honed it with the help of the formidable bloggers Mike Masnick and Robert Seidman before writing it up, knowing they’d poke holes in my reasoning. Thanks for the feedback, guys.) And yes, in a way this is a pitch for our own paid content offering; you can’t read the full version without signing up for a yearly subscription. But if you have comments from just this slice, please let me know here.


Peter Contardo

As we know, it’s all about the content. Whether it’s a cable company offering broadcast-quality programming, or a small, independent producer with niche show, pay-per-view and fee-based subscription models can work if the audience is provided content that is timely, exclusive, enhanced or in a format that is more convenient than otherwise available.

Terry Heaton

Liz, I’ve always enjoyed your writing and will miss it as part of the larger conversation. As a writer, the problem with a paid service such as yours is the subtle shift towards marketing in your prose. Sad, methinks, but such is the bain of those who are paid to say something. “Film at eleven.”

Liz Gannes

Thanks for the comment, Terry. I’ll definitely keep a cap on the self-promotion. I had just written a couple pieces for GigaOM Pro over the last few months (as have Chris and Liz Miller), and we’re excited about them so we want you to know they exist. Since the project was in development for a while, there’s a backlog of longer pieces that don’t fall as naturally into the conversation. But other than that, we’re still here like normal!

Marc Hustvedt

I like the smooth plug here Liz. :-)

Yes, I think we’ll see more and more premium or sub based content online. We all want a la carte in theory, but are we really willing to pay what it it costs for some of those channels or programs?

I support a handful of web series that I really love and watch regularly despite their being free. Their small production budgets mean a little can go a long way even from just the diehard fans.

But with premium television content, at a couple million dollars an episode, it’s going to take a lot of fans. Then at some point you actually get better value as a viewer (more channels/shows) just sucking it up and paying a cable bill.

Liz Gannes

@Marc – True enough, but there is something between the current cable packages and a la carte that I would find very appealing.

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