Site Admin – It’s The End of the Internet as We Know It (and I feel fine)

With apologies to R.E.M., I could not resist the title. We’re now two years removed from “The Crash.” The day when the blush came off all those dot-com’s which had no revenue strategy, but had great ideas for things no one wanted to buy.

We’re also two years removed from people running content based sites and being able to charge huge advertising rates based on the unsophisticated measuring stick of ‘eyeballs,’ I.E. How many people saw your page, not how many people arrived there looking for the subject matter you were presenting.

Executives in the online advertising field and companies which run heavy content driven sites are still trying to figure out how to make money online. They are fighting an uphill battle, one that may never be won, simply because people expect information for free. Companies have no clue as to how they can open readers wallets without scaring off their audiences.

How many content based sites will ever make money? Good question. News sites like MSNBC, CNN, ABCNEWS are all free. Lots of ads, true, but still free to the end user. Others like BusinessWeek Online is for those who subscribe for the magazine. You need to be a subscriber to get their online exclusives. However, at some point, expect to start paying for additional “premium” content, at most of your favorite news sites.

Some services will follow the model used in the adult industry – pay to view, or pay for a monthly pass for unlimited access to all content., recently announced it would begin charging for all video clips on its site. I’m sure all the other major media outlets will follow suit. Soon, for news junkies who want streaming video, a Real Networks SuperPass will become their equivalent of their monthly magazine subscription. This service collects video news clips from several sources, lets you see each of them an unlimited number of times, and costs $9.95 per month. It’s like having a clipping service on your desktop. I think people will pay for this type of enhanced service…for a while. The question then becomes will this business model work, in the long term?

ABCNEWS used to charge for their ESPN detailed content – As soon as they did, their readership went down and thus so did the amount they could charge for ad space. Now almost everything is free again.

Online content resources are quickly moving to mirror the rest of the media. The more popular the program, the more ad revenue it can generate. Premium products, analysis stories, marketing demographics and the like will cost us, but this is not a new concept. It only seems new to the Online world.

So far one tenet still remains. Basic, written textual content will remain free. There will always be more than enough free information on the net for 99% of the population on 99% of subjects. So, even though your favorite news source on the net may start charging you for your news soon, fear not! It will be free again… as soon as they start losing visitors and more money.