Will Pay Web Sites Succeed Like HBO?

Mickey Kaus wrote in Slate Aren't those who predict doom for the NYT's TimesSelect like those who predicted doom for cable television? After all, why would someone pay for a TV show when they could see TV shows for free on the regular broadcast channels?

For one thing, many of the columnists whose work is being blocked by NYT's TimesSelect are syndicated in other publications, and their work is available there. And those that are not, are not worth reading. If you want to convert this into a cable TV analogy; why pay to see a movie that is being shown on another channel for free.

That's what some people must have thought when cable programming started. Were they wrong! Won't the same thing happen with pay-Websites? There are several good answers to this question: For starters, news is more fungible than drama--any number of sites can tell you the Canadian government has fallen, and any one site isn't that much better at it than another. Plus the web is interactive--HBO's Sopranos doesn't depend for its visibility on being linked by free TV shows.

But let's accept and apply the cable TV model. What would it suggest for the Web? Not the New York Times' go-it-alone approach, in which each newspaper charges people to read its particular offerings. Most cable channels aren't sold individually, after all. They're sold as part of packages. If you get the basic cable package you get dozens of channels. If you get the premium package you get dozens more. The potential revenue raising equivalent, for newspapers, would come if they banded together in some sort of consortium (possibly even presenting themselves collectively as a cheaper rival to the NYT's premium offerings). Subscribe to this Basic MSM consortium for a modest annual fee and you'd get access to all the pages of dozens, maybe hundreds, of papers. True, the revenue would be divided many ways, but it would be something. ...

Perhaps, but either each paper would have to verify you paid, or they would have to use third party cookies, and it is likely there would be patches to get around that.

Wouldn't the remaining free Web sites flourish, giving each paper an incentive to stay out of this consortium and grab some of that traffic? Sure. But the consortium's goal wouldn't be to get all the eyeballs. (Cable channels don't get all the TV eyeballs either; many people only have "free" TVs.) The goal would simply be to charge a low enough fee and feature enough content so that the vast majority of Web users would feel like they had to pay the fee or else they'd be out of it, Internet wise--the same way most TV users now feel they have to at least subscribe to basic cable to be part of things. A $3/month fee, for example, would probably not stamp out rapid democratic discourse precisely because it would so low that readers could assume that everyone else was signing up, so they'd better sign up too.

$3 a month, spread around the entire consortium would not bring in as much money as advertising.