Wednesday, December 08, 2010

A Digital Price

So, News International has reduced its initial fees and now has priced its news sites at £2 a week. This is a tempting price. Less than a pint a week, or two paper editions. It seems that the publisher and consumer have an equilibrium. But, over a week it's still less than a quarter of the revenue of the printed version. Of course, printing, distribution and retail costs need to be stripped out, so £2 seems a good margin at volume for the publisher.

But Amazon has gone bonkers. Stephen Fry's latest book is £12.99 for the file on Kindle, £8.40 in hardback and £8.99 in paperback! Utter madness and Amazon should be censured for this. It's pure price gouging.

The overall consensus seems to be that £0.59 is a volume price for content items, £10 a month can work for subscriptions ( see Spotify ) .

So, for small scale digital delivery this works. The trouble is video delivery comes with a cost of sale (bandwidth), so the price points from publishing are interesting but not directly relevant.

Internet video delivery requires a scalable revenue solution, and advertising and sponsorship remain the holy grail...

It's interesting that no platform, apart from VidZapper, perhaps, addresses this, as far as I know..