The prevailing wisdom seems to be that AI will result in an explosion of content on the internet. But Bo Sacks recently distributed an article by Matt D’Cruz that makes the opposite claim. “There’s going to be a lot less free content around.”
I don’t think he meant that as a blanket statement. In context, I think he’s saying that existing publishers will be putting more of their content behind paywalls (because content outside the paywall will be slurped up by AI models).
He then asks, “But are users ready for a subscription-heavy future?”
The bad news is, no, they’re not. A recent study from the Reuters Institute and the University of Oxford says “averaged across 20 countries, less than a fifth [of news consumers] are currently paying for online news.”
“Subscribers” – that is, people who are willing to pay – “are motivated by a desire to access higher-quality news than is available from free sources.”
Lapsed subscribers – who were originally attracted with a low-price introductory offer – failed to see the value when it came time to pay the full sticker price.
This shows a crisis of value, but publishers seem to be focusing on offers. How many views before the paywall? How long should the trial period be? How do we step people up from the intro price to the full price?
Those are all important things, but only if you’ve already solved the value problem.
The reason people don’t subscribe is fairly simple. They don’t think what the publisher is providing is worth the money. Publishers have to solve that problem, and no amount of tinkering with a paywall is going to fix that.
This will only get worse with generative AI. Publishers will need to show value while AI is cranking out tons of content.
I can envision a few different approaches to this problem.
- Use AI to lower your costs, and therefore your subscription prices.
- Play off some sort of “support the humans” campaign, the way some companies say “support local journalism.”
- Do something AI can’t do. Unfortunately, that set will become smaller and smaller.
- Use AI to expand what you’re able to offer. For example, use AI for the data-heavy tasks, but use humans to provide context.
The real challenge is to provide something that has genuine value. Customers are very clearly telling publishers that they’re not doing this. Tweaking offers and monkeying with your paywall settings simply won’t save the day.
Links
Paying for News: Price-Conscious Consumers Look for Value amid Cost-of-Living Crisis
