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Google’s Newspass not a magic wand for publishers

Google may be keeping mum, but according to a recent report in the Italian newspaper La Reppublica, the online leader is planning to launch a one-click pay system for news content.

“Google will launch an integrated payment system that will allow users to buy (news content) with one click and publishers to use a single infrastructure for Web, mobile and tablet to monetize their content”, the report stated.

Newspass will allow content providers and news organizations, which have constantly hurled insults at Google for its inherent lack of respect for paywalls, to still opt into Google search, while receiving a payment from their readers through Checkout.

Google has yet to confirm or deny such a program is in existence, but it isn’t news they have consistently been working in the last few years for a solution to the almighty revenue-draining problems they have caused for publishers.

The New York Times’ Decoder quoted one Google spokesman as saying, “We’ve consistently said we’re talking with news publishers about ways we can work together, including whether we can help them with technology to power any subscription services they may be thinking of building”.

So will Newspass be the answer to publishers’ problems and begin a new era of gloriously paid content? News on the pay system has been consistently grim and Greg Satell, a blogger and consultant at the American online media Digital Tonto, doesn’t seem to think so, either.

According to his blog, those who believe the free digital content era is over are very, very wrong.

“The basic problem is that if you plan to exploit a paid model you will most likely have to compete with someone who will give it away in order to get more ad revenues”.

Erik Sherman, a long-time freelance journalist, agrees. According to the Pew study Sherman cited, the numbers comparing ad revenue to ad views was so small it was frightening.

“Say you’re getting 10 dollars per thousand page views. One million views is only 10,000 dollars. That won’t pay one loaded salary,” Sherman said in an interview. “This is why the publishers are saying we need to put up paywalls”.

Satell believes a young generation who has grown up not having to pay for content won’t be easily led to change their ways. Once it’s free, there’s no going back, and mobile and tablet applications won’t change that fact either.

“While many are sampling paid media apps on the iPad, it is far from clear that they will be a true path to payment (there doesn’t seem to be any shortage of free apps on my iPhone)”, Satell said. “Just because the technology changes doesn’t mean economics do”.

As for Google, Satell believes Newspass is a good move, but won’t produce much in revenue for the company.

“I don’t think it is a bet on paywalls nor do I think they’ll make a lot of money doing it. It is merely a way for Google to earn money on the small segment of publishers who wish to go with a paywall model,” Satell said in a message. “I, for one, strongly believe that this will be a market made up of specialty publishers (i.e. Harvard Business Review, academic journals, etc).”

Sherman expressed his views on Newspass by saying it is simply publishers’ last hope for their knight in shining armor to ride in and save them. 

“It’s going to crush their spirits because there is nothing that is going to save them. And I hate saying that”.

According to Sherman, as news organisations cut down on their journalists, they may have to cut down on their audience when they use paywalls, and at the same time cut down on their work.

“Something has to change. It’s dollars and cents, there is no way around it.”

Newspass and other paid content models come down to having content readers simply can’t get elsewhere.

“If you want to get paid content, you have to have something of high enough value that people will collectively pay for,” Sherman said.

When asked about mobile tablet applications, he says innovation alone is not enough.

As depressing and dooming as Sherman makes the future of news sound, he ended on the sad facts.

“Media people need to start being numbers people or they’re going to become part of the numbers at the unemployment office.”

Google Newspass may not be the change media and publishing tycoons need, but it is a start on a long discussion of where journalism may be, or not be, in the very near future.

Tags: google, journalism, news, newspass, online media, paidcontent, payment, paywall, system,

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