Friday, August 08, 2003

Who'll pay for Internet Content ?

Borders is a co-founder of Borders Group, the $3.4 billion company that today is the nation's second-largest bookseller. He is also the man behind the great bust of Webvan, the billion-dollar online grocer.
Borders now launches KeepMedia a subscription-based stuff for magazines such as Business Week, U.S. News and World Report and Esquire. Though it's an idea that's already been tried and failed, Borders believes KeepMedia is different and will prove to be a superior online brand, because, he says, it offers quality publications and convenience

His biggest challenge would be to convince Web surfers to pay to access archived online content.

"One thing that struck us is that the movie business (gets) two-thirds of their money from their archives, while magazines are getting zero. That's a huge pool of content that's not monetized at all"

"Magazines are tremendous brands with great communities, but they're underutilized. So, if we can put them together to help us build a brand, then we can in turn give them a revenue stream that's essentially paying them to better utilize their brand. It's like a mall. You know the stores inside"

The biggest thing that happened in paid content this year so far was when AOL announced that their Time magazines were going to go behind the AOL pay wall, which is a huge statement that paid content is the way to go. We were pretty excited about that. The more content that moves behind the pay wall, the more willing people will be to pay. "

"it's at about 15 percent of the Web population that's paying for content right now".Very soon, you'll see that the content that's left to be free is content that will not be trusted;

Where do you think previous ventures in selling content, such as Contentville, failed?

Contentville is an interesting example. In some ways, it was the right idea. But it was the wrong time, because people were not paying for content three years ago. They also did some things that killed them--mistakes that we won't make. One is they created content and distributed it, so anyone in the business was leery of being on its platform because they saw it as a competitor. We will never do that. Another was an execution error: They mixed really high-quality content with Joe's dissertation on something. And strongly branded publishers don't like to see their content next to second-rate content.

I see the Googles of the world like the freeways, where you're going from one place to the next, and that's the place to go. They have a very viable business being the main artery across the Internet. Our approach is to be a walled garden, where we bring in this very high-quality content. As a consumer, you would certainly want to use the freeway and the walled garden for different needs"
What makes you excited about the Internet right now?
The Internet is for real. The bubble has burst on the dot-coms, but it's amazing--its traffic numbers, its usage. I'm amazed at how much smarter people will be just because they have access.


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