A handful of South African content providers are still confident there is a place for paid-for electronic news and information, despite years of debate over whether readers will be prepared to buy this content.
South African news and information providers are slowly expanding their paid-for content offerings as they explore additional revenue streams. Local subscribers are paying between R40 to R5 000 per month to access information, depending on the content provider and the type of information required.
"It`s a case of creating demand rather than meeting a need. Few people specifically need an SMS news service, but if you market it hard enough, you can create a perceived need," says Arthur Goldstuck, MD of research house World Wide Worx.
South African content providers Mail & Guardian Online, PSG Online and I-Mobile all expanded their existing services to include pay-per-view services, offering breaking news, weather reports, financial data and other related material for a price.
Financial Mail and Finance Week charge slightly differently for access to online content - they require users to subscribe to their print editions in order to access 'premium` content online.
"It`s a controversial move," says Matthew Buckland, editor of M&G Online, "but I think loyal readers are prepared to pay for premium content. If readers place a high value on our premium content, they will be prepared to pay for that content. But it is a controversial move that is bound to cause resistance because we are asking readers to pay for something they previously had for free."
Certain parts of M&G Online are kept free in order to pursue online advertising. "But the in-depth feature stories and the unique content found deeper within the site are available only to paying subscribers. These include stories we publish from the Mail & Guardian weekly newspaper," says Buckland.
I-Mobile, I-Net Bridge`s news provider, sells its content to cellphone and personal digital assistant users, as the service is available for GPRS- and Java-enabled mobile devices. I-Mobile also targets the pager market, since I-Net Bridge`s research shows about 4 000 pagers currently in use.
"The response to the offering from traditional pager customers has been higher than expected," says Chris Lazarus, business manager of I-Net Bridge`s content solutions division.
Goldstuck feels it`s too early to say at what rate paid-for news is growing, but believes it will show rapid growth off a low base.
"In terms of online, Web-based content, users are not generally ready or willing to pay, unless there is a high perceived need for the content. For example, Wall Street Journal has a large subscriber base precisely because it is perceived as an essential read. Few other online properties have the same status," says Goldstuck.
A study conducted by the US Online Publishers Association found that spending on online content grew 18.8% to almost $1.6 billion in 2003 over the previous year. The majority of expenditure went into dating services, business content and entertainment, with these three sectors accounting for 64% of total spending.
"We believe paid-for content is the next step in the evolution of online publishing," says Buckland. "People pay for magazines and newspapers. Why not for Web site publications?"
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