4 ms·

A few different outlets have tried this over the years, and it's never gone that well, as far as I know. I think that was originally the model for Tinypass, wh

A few different outlets have tried this over the years, and it's never gone that well, as far as I know. I think that was originally the model for Tinypass, which merged with Piano Media. Not sure if they still offer that model or not, but it's the most recent I can think of. The reality is that for all but the largest news sites, this model won't really work. Say you're in a medium-small city. Even in your best case scenario of like 50% of the population reading your site, you'd still only likely get such a small sum per-article (10-20k pageviews, maybe?) that you'd still have to supplement revenue with advertising and other revenue streams. And now you're back where you started! I love the idea, but I just struggle to see it happen at scale.

hansvm 6y ago
> you'd still only likely get such a small sum per-article (10-20k pageviews, maybe?) that you'd still have to supplement revenue with advertising and other revenue streams Advertising and other revenue streams also only pay out per view on a fairly small number of views though, right? Is the problem not that advertising pays more per view than people are willing to in the first place of their own volition?
- Judgmentality 6y ago
  I am not an advertising expert, nor do I know much about monetizing static media (in this case I mean newspapers). But regarding Spotify, the business model roughly breaks down to the top 2% of artists get 98% of the profits. So...it's basically impossible for anyone smaller than NYT or WaPo to ever make money from this model. Likewise, most artists don't make any meaningful money from Spotify. https://qz.com/1660465/the-way-spotify-and-apple-music-pays-artists-isnt-fair/ https://qz.com/1660465/the-way-spotify-and-apple-music-pays-...
  - hansvm 6y ago
    > So...it's basically impossible for anyone smaller than NYT or WaPo to ever make money from this model. That doesn't necessarily follow though. It just means that organizations smaller than NYT or WaPo will make proportionally less money, which would be true of any monetization method. The question is whether you can bring in as many total dollars with such a shared subscription scheme as you could with advertising or some other similar venue. > Likewise, most artists don't make any meaningful money from Spotify. And if they would have made meaningful money with CDs, merch, and whatnot then the cause is that people are paying less in aggregate for music via Spotify than they used to from other channels (Spotify's cut might also play a role if the difference is only 2x or something). It's not that Spotify is paying out in proportion to listens, because that was already happening.
    - Judgmentality 6y ago
      > It just means that organizations smaller than NYT or WaPo will make proportionally less money, which would be true of any monetization method. You should look at the math in the article I linked. It's proportional to the aggregate of everybody - which basically completely disconnects it from what individual users listen to. For example: Spotify only has 2 users. User A listens to 10 hours of Drake. User B listens to 90 hours of Kid Cudi. Even though User A and User B both pay $10 and have very exclusively chosen their musical preferences, Kid Cudi gets 90% of the total pool of money. To put this in another perspective - imagine if someone on Netflix just looped Shit Show A 24/7 and there were 24 other users who watched Good Shit X,Y,Z... for exactly 1 hour every day. Netflix would allocate funding equally between the 1 Shit Show A that the 1 user watched and everything else that the 24 other users watched, even though that 1 show only actually generated 4% of their revenue. It doesn't make sense from a user perspective. As the numbers increase to the ~100MM paid users of Spotify or Netflix, disparity increases between casual users and power users, it all sort of explodes to amplify all of the earnings to a select few. What this means is the big guys dominate everything. I realize the music industry has shifted from touring to sell records, to streaming to sell concert tickets - but how do you do that for newspapers? Newspapers can't do anything equivalent to concerts. At that point they're just news stations, which really aren't the same as concerts from a business perspective.
      - hansvm 6y ago
        > You should look at the math in the article I linked. It's proportional to the aggregate of everybody - which basically completely disconnects it from what individual users listen to. I have actually read the article, and that's wholly compatible with my take on things (that before and after Spotify artists are paid roughly proportionally to how much their music is "used"). There are two interesting points that can create the apparent problem/paradox you're seeing: (1) It's interesting that a typical power user before Spotify would pay more money for more music, and now there's a flat rate (or counting ads, two flat rates). (2) The definition of "usage" has shifted a bit. Skipping a lot of details, before recordings people paid per performance, with the introduction of CDs and whatnot people are able to pay per unique song listened to (with power users typically though not necessarily buying more CDs), and Spotify shifts things back so that artists are compensated in terms of total listen time. It's probably true that power users should pay more (if not, and if artists are appropriately compensated, then everyone else is subsidizing their use), and there can be an interesting discussion around how listeners actually derive value from music and if unique songs matter more than total minutes (or if a more complicated but less explainable metric ought to be used), but the big guys dominating everything is not a new phenomenon. As an aside, the advertising, distribution channels, and network effects enabling the big guys to dominate everything to the extent they do _is_ moderately new on a human timescale, but that would be true independent of the payment scheme and doesn't seem super relevant to the discussion.
- creinhardt 6y ago
  Well, advertising is usually billed to advertisers as a cost-per-thousand (really, cost-per-mil, or CPM) for impressions. For a small local news site, they'd be super happy to get a $10 CPM on a local online ad. So let's just say for fun that we'd get the same rate for the hypothetical 'Spotify for news' service. Say a locally focused article about the latest city council meeting gets 20,000 views. At a $10 CPM that only generates $200 (or $0.01 per person). Does that seem like enough revenue to cover the time it took the reporter to attend the meeting, write up the story, have it proofread/edited, and then posted online and printed and still make a profit? Probably not! The sad part is that the $.01 per person rate is way, way higher than what Spotify apparently pays out (around $0.006 to $0.0084 from some Googling). This starts to look better if you just go to something like $0.25 per read, but at that rate you're likely charging much more than it would cost to buy a print copy, or a per-day subscription rate, so i'm not sure the economics would work out there either.
  - wolco2 6y ago
    When the full paper costs .50-2.00, .25 is too much per article unless you get the entire paper.
    - creinhardt 6y ago
      Yeah, definitely! I think it'd be a tricky thing to balance an appropriate rate for most publishers. I suppose you'd start by figuring out how many articles per-day the average reader lays eyes on. You'd also start to have to forecast revenue that's correlated directly to readership, which would probably lead to fewer articles about city council, and more listicles or salacious coverage.
- tomjen3 6y ago
  If I own a plumbing business I don't want to advertise to everybody. I want to advertise to people 20 miles from my shop, who are likely to hire me.
bigpeopleareold 6y ago
You're right with Tinypass - it didn't work out. Piano's model is a bit more financially viable for the type of customers it is targeting.

hansvm 6y ago

> you'd still only likely get such a small sum per-article (10-20k pageviews, maybe?) that you'd still have to supplement revenue with advertising and other revenue streams Advertising and other revenue streams also only pay out per view on a fairly small number of views though, right? Is the problem not that advertising pays more per view than people are willing to in the first place of their own volition?

Judgmentality 6y ago
I am not an advertising expert, nor do I know much about monetizing static media (in this case I mean newspapers). But regarding Spotify, the business model roughly breaks down to the top 2% of artists get 98% of the profits. So...it's basically impossible for anyone smaller than NYT or WaPo to ever make money from this model. Likewise, most artists don't make any meaningful money from Spotify. https://qz.com/1660465/the-way-spotify-and-apple-music-pays-artists-isnt-fair/ https://qz.com/1660465/the-way-spotify-and-apple-music-pays-...
- hansvm 6y ago
  > So...it's basically impossible for anyone smaller than NYT or WaPo to ever make money from this model. That doesn't necessarily follow though. It just means that organizations smaller than NYT or WaPo will make proportionally less money, which would be true of any monetization method. The question is whether you can bring in as many total dollars with such a shared subscription scheme as you could with advertising or some other similar venue. > Likewise, most artists don't make any meaningful money from Spotify. And if they would have made meaningful money with CDs, merch, and whatnot then the cause is that people are paying less in aggregate for music via Spotify than they used to from other channels (Spotify's cut might also play a role if the difference is only 2x or something). It's not that Spotify is paying out in proportion to listens, because that was already happening.
  - Judgmentality 6y ago
    > It just means that organizations smaller than NYT or WaPo will make proportionally less money, which would be true of any monetization method. You should look at the math in the article I linked. It's proportional to the aggregate of everybody - which basically completely disconnects it from what individual users listen to. For example: Spotify only has 2 users. User A listens to 10 hours of Drake. User B listens to 90 hours of Kid Cudi. Even though User A and User B both pay $10 and have very exclusively chosen their musical preferences, Kid Cudi gets 90% of the total pool of money. To put this in another perspective - imagine if someone on Netflix just looped Shit Show A 24/7 and there were 24 other users who watched Good Shit X,Y,Z... for exactly 1 hour every day. Netflix would allocate funding equally between the 1 Shit Show A that the 1 user watched and everything else that the 24 other users watched, even though that 1 show only actually generated 4% of their revenue. It doesn't make sense from a user perspective. As the numbers increase to the ~100MM paid users of Spotify or Netflix, disparity increases between casual users and power users, it all sort of explodes to amplify all of the earnings to a select few. What this means is the big guys dominate everything. I realize the music industry has shifted from touring to sell records, to streaming to sell concert tickets - but how do you do that for newspapers? Newspapers can't do anything equivalent to concerts. At that point they're just news stations, which really aren't the same as concerts from a business perspective.
    - hansvm 6y ago
      > You should look at the math in the article I linked. It's proportional to the aggregate of everybody - which basically completely disconnects it from what individual users listen to. I have actually read the article, and that's wholly compatible with my take on things (that before and after Spotify artists are paid roughly proportionally to how much their music is "used"). There are two interesting points that can create the apparent problem/paradox you're seeing: (1) It's interesting that a typical power user before Spotify would pay more money for more music, and now there's a flat rate (or counting ads, two flat rates). (2) The definition of "usage" has shifted a bit. Skipping a lot of details, before recordings people paid per performance, with the introduction of CDs and whatnot people are able to pay per unique song listened to (with power users typically though not necessarily buying more CDs), and Spotify shifts things back so that artists are compensated in terms of total listen time. It's probably true that power users should pay more (if not, and if artists are appropriately compensated, then everyone else is subsidizing their use), and there can be an interesting discussion around how listeners actually derive value from music and if unique songs matter more than total minutes (or if a more complicated but less explainable metric ought to be used), but the big guys dominating everything is not a new phenomenon. As an aside, the advertising, distribution channels, and network effects enabling the big guys to dominate everything to the extent they do _is_ moderately new on a human timescale, but that would be true independent of the payment scheme and doesn't seem super relevant to the discussion.
creinhardt 6y ago
Well, advertising is usually billed to advertisers as a cost-per-thousand (really, cost-per-mil, or CPM) for impressions. For a small local news site, they'd be super happy to get a $10 CPM on a local online ad. So let's just say for fun that we'd get the same rate for the hypothetical 'Spotify for news' service. Say a locally focused article about the latest city council meeting gets 20,000 views. At a $10 CPM that only generates $200 (or $0.01 per person). Does that seem like enough revenue to cover the time it took the reporter to attend the meeting, write up the story, have it proofread/edited, and then posted online and printed and still make a profit? Probably not! The sad part is that the $.01 per person rate is way, way higher than what Spotify apparently pays out (around $0.006 to $0.0084 from some Googling). This starts to look better if you just go to something like $0.25 per read, but at that rate you're likely charging much more than it would cost to buy a print copy, or a per-day subscription rate, so i'm not sure the economics would work out there either.
- wolco2 6y ago
  When the full paper costs .50-2.00, .25 is too much per article unless you get the entire paper.
  - creinhardt 6y ago
    Yeah, definitely! I think it'd be a tricky thing to balance an appropriate rate for most publishers. I suppose you'd start by figuring out how many articles per-day the average reader lays eyes on. You'd also start to have to forecast revenue that's correlated directly to readership, which would probably lead to fewer articles about city council, and more listicles or salacious coverage.
tomjen3 6y ago
If I own a plumbing business I don't want to advertise to everybody. I want to advertise to people 20 miles from my shop, who are likely to hire me.

bigpeopleareold 6y ago

You're right with Tinypass - it didn't work out. Piano's model is a bit more financially viable for the type of customers it is targeting.