87% Don’t Want to Pay Online

People don’t want to pay for online content, no matter where they are in the world: That’s the result of a new study conducted by the GfK Group based on interviews with 16,800 people in the U.S. and 16 European countries. Only 13 percent of all respondents around the globe said that they were willing to pay for online content, while 33 percent even said that they wanted everything for free, without ads. I guess BitTorrent downloads weren’t an explicit choice, but they probably would have gotten quite a few votes as well.

The GFK study (German press release), which was conducted on behalf of the Wall Street Journal Europe, tried to get a sense of how people use the Internet in the U.S. as well as different parts of Europe. The willingness to pay for online content was just a small part of it, but the results are definitely noteworthy, if not troublesome, at least if you’re in the business of selling content online. However, just like on a backpacking trip through Europe, there’s always some places that are worse than others.

Selling movie downloads or similar digital goods is going to be especially hard in Eastern Europe, where only 7 percent of all respondents are willing to pay for online content. Things are looking a little better in the U.S.; 17 percent of the respondents from this side of the pond told GFK that they were willing to bust out their credit card for online content, while 21 percent insisted on everything being both without ads and free.

The picture is more complex in Western Europe. People in Greece, for example, seem to be most accepting towards ad-supported content, with 61 percent saying that free with ads is their preferred model for online content. Go to Spain, on the other hand, and you’ll find 54 percent who’d like everything free, without any ads whatsoever. So where can you make money selling content? In Sweden, 23 percent of people are willing to pay, as are 18 percent of all the respondents in the UK.

As always, there’s more than just one way to explain these results. Recent news that digital music sales in Sweden had soared prompted speculation that the country’s tougher anti-piracy laws are working, and one could assume that the high willingness to pay has something to do with this as well. However, France has even tougher laws against file sharing, but 92 percent of all French say non bien to paid content, while 50 percent prefer their digital goods free and ad-free. My hunch is that both the increased music sales as well as the higher willingness to pay in general have much more to do with the power of Spotify than with any laws against torrenting.

So what does all of this mean for online video? Well, if your business relies on selling content to anyone but Swedes: Good luck. No, seriously, the results make it pretty clear that free is here to stay, but that there’s also a learning curve that could lead to more freemium models. And here’s an interesting tidbit: People that are willing to pay would oftentimes even tolerate ads for paid content. Again, Sweden is leading the way, where 12 percent said that they’d pay for content with ads, while 11 percent said they’d want their paid content ad free.

I don’t think that means that people want to buy TV show episodes from the iTunes store that feature a bunch of commercials, but that they’d be open to reasonably priced subscription models that feature ads, but also exclusive content for paying subscribers.