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Reality Sets In
Maybe it was Internet World that brought on the reality check that hit the net in the past couple of weeks. Leave it to an enormous room of expensive booth space to make everyone realize that they're gonna need a way to pay the bills.
Crying "uncle" first, the Wall Street Journal announced they will transition access to "Wall Street Journal Interactive" to a paid subscription basis as of July 31. The new site will include "value add" services above and beyond what's currently available at the Journal -- customized news pages, company briefing books, articles from the Asian and European editions, and two weeks of searchable history.
(Hmmm. Two weeks of searchable history. Wouldn't it be just marginally more difficult to put five, ten or fifteen years of history on the site? Well, yes, but that would cannibalize the Dow Jones news service business...and we wouldn't want that, would we.)
The story behind the Journal story? That perhaps advertising alone can't support high content, high cost web sites. The Journal reportedly has a staff of 35 responsible for the web site alone. And without reverting to a shovelware experience, they can't do compelling content without another source of income -- their subscribers.
I've said this before, but we're going to see more and more subscriber supported web sites. But not just because web sites are expensive to create. Some advertisers are actually waking up to the power they have.
Procter & Gamble caused a mild stir last week when they told Yahoo that they would only pay for clicks on their ad banners, and not just for page views. Conventional advertising wisdom dictates that advertisers pay for impressions -- just like they do in the print or broadcast world.
But P&G used the power and promise of their massive advertising budget to turn the tides. And publishers are running scared. In Robert Seidman's Online Insider, Scott Kurnit (former #2 at Prodigy) was quoted as saying ""It's the responsibility of the advertiser (not the media outlet) to get the order. If P&G runs an ineffective ad on CBS that doesn't sell the goods they don't go back to CBS looking for a credit." Well, I think that P&G understands that the web is not just any old "media outlet." First, it's a young and unproven media outlet. And second, the technology is there to make it easier for advertisers like P&G to measure the effectiveness of their banners. And to only pay for what works.
If this the havoc that Procter & Gamble can wreak, what happens when Nike goes online? All they have to do is dangle the promise of the swoosh ad banner in front of web sites, and they'll be paying for folks who "just click it."
Finally, evidence that the industry is already getting stale. Several hundred Internet World attendees suffered through the "First Annual C|Net Awards for Internet Excellence."
And gee, Marc Andreesen won as person of the year. What a shock!
Hey, at least Halsey didn't nominate himself.
Other pieces about ecommerce: