It’s been a classic case of misappropriation, the cries of “information wants to be free” echoing Stuart Brand’s 1984 speech at the Hackers’ Conference. This single misbegotten touchstone has driven initiatives and perceptions as information has moved online. But, as we all know, it’s an incomplete (and, therefore, incorrect) quote. The actual quote is:
On the one hand information wants to be expensive, because it’s so valuable. The right information in the right place just changes your life. On the other hand, information wants to be free, because the cost of getting it out is getting lower and lower all the time. So you have these two fighting against each other.
Brand sensed a tension between the value of information and the falling costs of distributing it. Because we conflated the value of the information with the expense of finished goods and distribution when print was the best package, finding the value of the information outside of print was going to be a bit of a challenge.
Ultimately, information is valuable, and therefore should cost money.
Never before in history have people paid as much for information as they do today.
He’s absolutely right — from the fees you pay for Internet access to the price of that desktop computer and monitor to the price of that Kindle to the price of your iPhone to the price of the apps to the price of the digital music, we’ve shifted forms of finished goods and distribution, yet the amount most people pay for information has gone up, not down.
Instead of paying for paper, we’re paying for pixels, bandwidth, devices, and customization.
It may be the age of abundance, but that doesn’t mean information is free.
Charging for information is a clear-cut way to know how valuable it is. Mitch Joel talks about this in a recent blog post inspired by the New York Times’ recent announcement of its metered payment approach.
Yet, the landscape has shifted dramatically as to who makes the money. As the chart below from Gizmodo shows, we’re paying more on subscription fees than we might think. The subscription model is clearly thriving. The problem for publishers is that subscriptions to their old packages are losing value and appeal, and the notion of an annual subscription is outmoded.
Publishers used to be masters of the subscription model, but now our subscriptions have become cumbersome and clunky. Since we sell annual subscriptions, the trend is to drive prices annual down in the consumer space, almost to suicidal levels. Yet when the Huffington Post went on the Kindle, it charged $1.99 per month — about three times the annual cost of a print subscription to Wired was last year (thanks to Wired‘s overly aggressive pricing practices). The Huffington Post delivers nothing but pixels, and to an expensive device. Yet thousands were happy to pay — after all, $1.99 per month is next to nothing.
And this is ultimately how the “information wants to be expensive/free” dichotomy gets resolved — by letting information find its proper price point in systems that let transactions flow.
Finding that price point means picking the right path to success. More and more often, that path is paved with smaller monthly payments, until-forbid renewals, and term contracts. The old paradigm of annual subscriptions and 4-pre/2-post renewal notices feels creaky and vulnerable.
Subscriptions are thriving all around us, yet we continue with old practices or move slowly to change standard approaches.
I feel like we continue to be trapped in a construct that rests on three key misconceptions:
- Information wants to be free
- Individuals won’t pay for subscriptions
- The subscription model is dead anyhow
How high a priority is the subscription model in your organization’s commercial strategy? Because of this framework or something like it, are we even equipped to detect the subscription’s proper place as a user preferences? I’ve heard stories of publishers actively downplaying or ignoring subscription revenues, dismissing them even though they’re substantial, even growing. It’s probably because they’re blinded by a framework that seems more convincing than the evidence right in front of their noses.
If individual subscriptions aren’t a priority, how can we find the new sweet spot? Will we invest the energy and systems necessary to disrupt our own model? Or is this a possible Achilles’ heel, something that gives the likes of Amazon a distinct business advantage?
Clearly, the subscription model is changing. Instead of annual subscriptions, we’re moving to monthly or even weekly subscriptions. Instead of renewal series, users want to keep paying until they stop. Instead of annual commitments, users are willing to commit for longer periods if the deal is right.
Publishers need to acknowledge these changes in their models.
We might want to reassess the subscription model. After all, there’s plenty of evidence that it still works, and is in fact an increasingly popular way to pay for access to valuable information.