Internet has vastly improved the flow of news and information around the world extending the reach of newspaper and media firms across a wide swath of global population. This is an established fact, though there are some countries, like China, who continue to control the flow of information to their citizens. While the reach of Internet media giants, for instance, http://www.nytimes.com, has increased several folds, they have been faced with declining advertising revenues. The Los Angeles Times (http://www.latimes.com) has been continuously cutting staff in order to avoid sinking into bankruptcy. On the other hand, Internet search and distribution firms (for example, Google, Yahoo and the likes) continue to rip content from newspapers and distribute it as their own.
Let me make one thing clear at the outset. Content creation is an expensive business. I agree that the relative cost of content creation has been declining due to positive feedback loops between Internet technology, declining cost of data and multimedia technologies, their growing popularity and increasing public knowledge. But the cost of content creation is still higher than the cost of search and distribution. Therefore, the evolution of Internet has created an anomaly. While the cost of content creation is borne by content creation firms, majority of the revenue is cornered by the search and distribution firms. While content is open and shared, the technology that drives search is proprietary and rightfully protected by laws. I fully support protection of intellectual property through copyrights and patents. But the playing field needs to be level for content creation firms too.
From this point of view, I was heartened to know that NYTimes.com plans to start charging readers from 2011. At the recent "PaidContent 2010" conference organized by http://www.paidcontent.org, Martin Nissenholtz, Sr. Vice President of digital operations, said that they plan to use a "metered model" that will offer partial free access to readers. Eventually, most of the newspapers and content creation firms will have to adopt a similar model in order to stay financially viable. The earlier "TimesSelect" model of subscriber-driven revenue was not able to generate sufficient revenue for NYTimes. As a result, it was discontinued. I'm expecting that the new "metered model" will be closely watched by many newspapers.
NYTimes.com is trying to optimize their revenue through advertisements and subscriptions. If majority of the content becomes paid content, advertising revenue will decline. Readers are demanding higher value from media creation firms and it is unlikely that they will be willing to pay unless the quality of content is substantially improved. Newspapers and content creation firms have paid inadequate attention to the quality.
Now what worries me is that if the users in US start subscribing to paid content, users in the rest of the world will be deprived of the content due to differences in exchange rates, income levels, purchasing power. One US dollar can be a prohibitive amount of money in many parts of the world. USA continues to lead the world in providing news and information about world events. This allows us to communicate our values and impact the world events.
How would people in the rest of the world subscribe to paid content? Do we need a way to subscribe to paid content through Internet Money that is not linked to crazy taxation, exchange rate, purchasing power and income levels?
Therefore, here is another idea about creation of Internet Money that will allow people around the world to earn it, keep it and use it for buying information on the Internet but won't be become as much out of the reach as bitcoin.
