Online Content Monetization: Critical Viewpoints From George Siemens And Gerd Leonhard

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How are publishers going to monetize online content in the future? With the launch of the iPad, Rupert Murdoch still picking on Google and positive signs of recovery from the economic recession, the discussion on online content is hotter than ever.

Photo credit: David Meerman Scott

With some revenues back in their wallets, publishers are starting again to explore alternatives business models they can use to monetize their content. Are paywalls a sound strategy? Or is it the freemium model the better way to go?

To make greater sense of this issue myself, I have prepared two unpublished video interviews with educational technologies, learning and connectivism expert George Siemens and with Swiss media futurist Gerd Leonhard, in which I inquire both on the future of online content monetization and distribution.

The key takeaway emerging from these conversations is that content is no longer a separate entity that you can take, share and sell "as it is".

What really matters now is what you sell around your content.

It may be the ease of consumption, of access, the curation work that lies behind it or the personal touch that you deliver with the content. It can be a million different things, but it is this additional "value" that opens the doors to new sustainable and effective business models. I have already addressed this free / paid content issue before, for example when I discussed the best strategy to market a film DVD online. You might want to check that out.

If you are interested in understanding better how the notion of "free" is changing and how the value of content curation is rapidly increasing and becoming the foundation of a new online business model, I think you will enjoy a great deal what these two guys have told me.

Here the two video interviews complemented with their full text transcriptions:

 

Online Content Monetization: George Siemens' Critical Viewpoints

Duration: 7' 07"

George Siemens: The free-time stage is not over, but one thing I am concerned about, and that I will not quite get to the news initiative.

I just want to talk a little bit about the software end, because this is something I am concerned about.

There was initially in late 90s, early 2000 a lot of interest in open-source software. I remember individuals would move, for example, when Movable Type announced they were not as open as people had thought they were. Huge groups moved over to WordPress, and there were some publications on people saying that - Mark Pilgrim posted on this - Movable Type was not open enough. It was open, but not open enough.

What ended up happening was people who wanted to write custom code and make those kind of adjustments, they were interested in Movable Type as much because they did not have that control. WordPress, no problem, they could do what they wanted.

We had this flare-up, where people were saying: "Openness is critical."

What happened last five years though? That openness model has fallen to the background, because we have misplaced - this is an early statement that Stallman mentioned - it was not about open or free as in beer, it was free as in freedom, as in liberty.

What happened now, many people are using a raft of Google sites, whether it is Gmail, Google Docs or whatever else, they are using Zoho, the podcasting service that will host their sites, PodBean and other stuff.

They are happy to use free in a monetary sense - which is OK now - but it will become a significant issue, because free in a monetary sense is not the premise for a suitable sustained future in a content or in a publishing kind of a field.

It has to be free as in access, free as in liberty.

To that regard - and I have been whining about this lately - Google has done a big disservice, because if you want to get your email out of Gmail there are ways to do this, but it is not as simple as doing an export out of WordPress to move your resource into a different blog.

Those are some of things that are frustrating me. A lot of educators now are starting to say: "We want zero cost instead..." - they are not making that choice explicitly, they are doing it by the tools they select, by relying on some of these tools that are not open source, but they do not have to pay to use them.

That is the backdrop that I wanted to get to answering your question, if I was talking to newspaper people.

The way to ensure a healthy society and to ensure a democracy is for critical conversations to be in the open.

If you start having conversations that are only accessible by certain groups of people, or only accessible by certain people, then you start to undermine the notion of a free and an open society to a degree.

It might not be catastrophic when it first starts to happen, but eventually we end up creating, within content, a social-class distinction that we do not have right now in an open Internet - or in a partial-opened Internet.

There is already content being walled-in, which would mean that in order to read the key information in The Wall Street Journal, will has to happen? I have to have a certain level of economic status in order to pay for it.

I fully understand why The Wall Street Journal wants to make money and I am not sure how they will make money in the future, but I am quite confident they will not make it by charging for content.

What you are suggesting is that - and this is the same point I was making about the people who filter some of the information, who play that middle role - the content is not the value point, but the commentary on the content, THAT could be a value point. That is what some of the people might be willing to pay for.

They might be willing to say:

"I want to hear what Robin Good thinks about the fact that Skype might be sold by eBay. What are the implications of that? And if I already have a strategy and place in my own company to use Skype, what should I be thinking about in order to not get blind-sided by Skype?"

That is different now. Now you are asking for someone to invest particular expertise and share a particular structured prospective on a subject, that is different than saying: "Should information about Skype sale be available for free or not?" In my eyes, yes.

Information should be free, but commentary? That is a slightly different slant, and it is something we could spend a long time talking about because... At what point does commentary become information and then ought to be free?

I think for you to say:

"I have spent a decade trying to stay on top of this field - new tools, collaborative technologies - I have invested very heavily in a time prospective on knowing what it is going on."

For you to then say: "I would continue to share all the information, all the news about who gets sold, what is happening here, what is going on there." I would continue to make all of that available free, for anyone who wants, because that is the premise of a reasonable healthy society.

And then for you to say: "If you have contextually specific questions that I can answer to tap into my expertise, my wealth of knowledge that I have required over the years of following these trends.", yes that is a value point and that is the point earlier that I mentioned.

Simply sharing information or content it is not a point in which we can build an economic structure.

There is a distinction here. One is: What generates value for content?

What you are doing is you are generating value, you are adding value by putting physical effort in. You are taking time. You are doing something with this in order to create a product that is more contextualized to the needs of a particular organization, which is different than just simply making your content an information available for free.

The distinction I am making is: If I post something on my site, it has zero cost to be re-posted. Somebody can cut and past that and it is not like a book. A book had an input cost. We had to buy paper, print, your people operating the printing press.

There was a value process created through the publication of a physical book. People were investing dollars in products and cost.

When you do it online, the ability to duplicate content online is virtually zero.

Getting back to the point I was making. For you to then find a value point, it has to be based on something that you are contributing time and effort in, that cannot be duplicated by cut and paste.

What you are suggesting is you are providing specialized commentary, a unique prospective.

You are saying: "This is what is impacting this field. I am picking out the important resources and that are going to be contextually relevant to you as an organization." Is that a value point? Yes, it is.

Pure information without that kind of commentary, that does not have an economic value point.

 

Online Content Monetization: Gerd Leonhard's Critical Viewpoints

Duration: 3' 07''

Gerd Leonhard: The future of news and online publishing and magazines. Of course, this is a heavy question.

First of all, I think the issue of monetizing as it used to be, which is essentially by owning the printing truck and the distribution network and then you can sell the ads, is winding down. But clearly on the web you cannot sell things in the same way.

Murdoch has a point in saying that "we used to collect dollars and now we get pennies". That is probably the truth for digital at this time.

However, I think that Kevin Kelly from Wired Magazine has the right term for this, he calls them "the new generatives".

We need to find new ways so that we can package content that generates the revenues, rather than forcing scarcity, for example by micro-payments or putting a sort of road blocks into them.

I think that the road blocks are so marginal that you do not notice - the payment is built and then it is fine, but most of the time they would not be that way.

I think new generatives, for example, would include software.

When I buy my next generation smartphone, The New York Times sells me an application for $20 that has all these benefits of having direct access through the application to the New York Times, therefore I am not just buying the content. I am buying the convenience, the packaging, the handling, all the extra stuff that they offer me.

Pandora, for example, online radio station which unfortunately we cannot get anymore in here.

Pandora U.S. has just lunched Pandora One, and Pandora One goes for the iPhone and the BlackBerry, so mobile applications and also for the desktop.

What they do, is they do not sell the music, they sell all the extra stuff, so you get a stand-alone player, ads-free radio streams, higher quality bitrate.

The question is not so much: "Can we sell the content?", but "can we sell anything around it?"

Clearly we cannot sell the content only. I think that is probably true for premium - we can for certain things - but in general, probably not. This is not new, because Cable TV has the same approach.

We sell everything around it: The convenience, the ease, the selection, the curation and everything.

These models are just now being developed and it would be too early for us to say that, because right now we are having trouble selling content - for example music, that it cannot be done.

I think we are just at the point where we are just at the beginning of the iceberg of looking at these new models.

But one thing is for sure: If content owners do not give permission for the content to be experimented with and to be tried - like PRS, MCPS in the UK does not want to license YouTube, or has refused, or the other way around, actually, but it has not come to a deal - then content would be used without permission.

If that is the preferred mechanism then we have a bad situation in the ecosystem.

Permission is crucial.

Video clips originally recorded by Robin Good for MasterNewMedia, and first published on April 9th, 2010 as "Online Content Monetization: Critical Viewpoints From George Siemens And Gerd Leonhard".

About George Siemens

From late 2009, George Siemens holds a position at the the Technology Enhanced Knowledge Research Institute in Athabasca University. He was former Associate Director in the Learning Technologies Centre at the University of Manitoba. George blogs at www.elearnspace.org where he shares his vision on the educational landscape and the impact that media technologies have on the educational system. George Siemens is also the author of Connectivism: A Learning Theory for the Digital Age and the book "Knowing Knowledge" where he developes a learning theory called connectivism which uses a network as the central metaphor for learning and focuses on knowledge as a way to making connections.

About Gerd Leonhard

Gerd Leonhard is a media futurist as well as an author and writer, a media and Internet entrepreneur, a strategic advisor, and a keynote speaker & presenter. If you want to get a good feel for what he does, you can check out Gerd's blog MediaFuturist or visit his Youtube channel.

Robin Good -