Would you pay $50 a month for open access to droves of paid content and services? Netflix, Pandora, Hulu Plus, The New York Times, The New Yorker, Wolfram Alpha Pro, JSTOR, etc…
Here’s a sketch of a business model that provides this kind of service:
- Some company — I can’t think of a good name so I’ll call it a Subscription Manager (other ideas?) — establishes a wide array of contracts with paid content providers like the aforementioned businesses. The Subscription Manager agrees to pay the content providers a piecemeal rate for their content — a few cents for an article, $1 for a movie, etc…
- Consumers pay the Subscription Manager a monthly rate ($25 – $50) to have open access to all of the paid content offered by the content providers.
- The Subscription Manager makes its money from the difference between the sum of piecemeal rates it pays the the content providers and the sum of monthly subscriptions it gets from consumers.
- This model seems attractive to consumers as they would have access to a wide variety of paid services.
- At first glance, this model would be less attractive to the paid content providers who would prefer a subscription over piecemeal charges to the Subscription Manager. But really this is free money for them – these content providers are attracting a new audience. For these are providers like the Financial Times or Wall Street Journal – both are subscriptions services with content I occasionally want to read, but not enough to subscribe. However, if I were to sign up with a Subscription Manager and had access to the WSJ and the FT I would start reading their articles and they would be compensated by the Subscription Manager.
- One big upshot is that the Subscription Manager intermediates micro-payments, which consumers have shied away from. In a way the Subscription Manager is simply converting micro-payments into monthly payments.
- The Subscription Manager also could create a market for paid content. Smaller content providers (bloggers, independent journalists, independent filmmakers) could arrange contracts too. Although, individually these contracts may incur losses for the Subscription Manager (more payments), the ubiquity of the service may eventually lead to more subscriptions.
I’d sign up!