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« Montreal Radio Suspends Anti-Israel Programmer | Main | April 21 Links »

Wednesday, April 21 2010

The End of Free?

MoneyHonestReporting's social media editor, Alex Margolin, contributes occasional posts on social media issues. He oversees HonestReporting on Facebook.

In the good old days, the Internet was a hub of free content. Things people paid for in the brick-and-mortar world - music, news, software – were readily available online in free digital versions.

But while there is still a great deal of free stuff online, the tide appears to be turning against the “free” model, at least for content that has value in the real world. File-sharing sites such as Napster, which threatened to destroy the record industry, have largely disappeared, replaced by Itunes, which charges a small fee for each song.

Like the recording industry, the newspaper business is betting that people are willing to pay a price for content. Ruport Murdoch’s Wall Street Journal has begun to charge for most of its content, and the New York Times plans to do the same starting next year. Other publications, such as the Financial Times are thriving behind their own pay walls.

Social media services have also started seeing a shift. While the superpowers – Google, Facebook, YouTube, and Twitter – are likely to remain free thanks to their advertising revenues, smaller players aren’t so sure. Just this week, Ning, which allows people to create their own social networks, announced that it was phasing out its free service in order to devote all of its resources to paying customers.

In a telling note, Ning CEO Jason Rosenthal said that 75% of its traffic was coming from subscribers to its premium service, meaning that the most active users were those who paid for the service. Commenting on the Ning announcement, technology blogger David Heinemeier Hansson put it best: “The just-give-it-away-for-free-and-they-will-come-and-we’ll-be-rich automatron is as broken now as it was in 2001.”

So what does this shift mean for Israel’s public diplomacy? It means that media bias may become harder to monitor and to fight, but it would also reach a smaller audience. An uptick in pay walls on Internet services also means that today’s guerilla marketers will have a harder time spreading the news across the web.

But Internet users have shown great resilience in keeping the Internet free. Expect new technologies to emerge to fill the gaps left by the emerging paywalls.

Are you more likely to stop vising a paper like the NY Times over a paywall, or pay a small fee?

Previously in Alex's series: People Support the Things They Help Build



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