Mark Kuban advises Fox and MySpace to sell content: Yes, you can

Original author: Mark Cuban
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From the translator: so far most of the materials that I translated and published on Habré have defended the position of the free distribution of news content. Explanations, theories, and business models were given for this position. To take money for access to content now seems like absolute stupidity. However, today I am publishing a translation of an article that has a slightly different angle of view.

Mark Cuban is the owner and co-founder of HDNet , the blog maker of Blog Maverick .

Rupert, you didn’t ask my opinion on this subject, but when did it bother me? First of all, the good news. You can sell content on the Internet. People pay for content every second every day, both on the Internet and beyond. It is very easy to organize if everything is done correctly. But before I tell you how to do this, add a few intermediate introductory notes.

1. Block aggregators that link to your content.
Too many of them? Nonsense! Traditionally, everyone believes that any traffic is good. The more page views, the more money. What is wrong here? The fact that this traffic is small and that you, in fact, do not benefit from it. At best, all traffic sent to you by most sites is a drop in the bucket. Let's look at your friend Michael Wolff and his . According to Quantcast, it has 24,000 unique visitors per day. If 1% of them go to any of the Fox sites, for example, the NY Post, and everyone views 5 pages, you get only 1,200 views. If you could sell all the ads on these pages for $ 15 per thousand impressions, you really can't, you would earn 18 bucks. This is about 6500 bucks a year. Best case scenario.

It is more likely that in the current situation with news on the Internet, you will not be able to convert even 90% of the traffic sent to you by this site. Hell, in any case, you cannot sell these visitors a large amount of advertising, so the value of traffic from tends to zero for you.

So why will you help a site that is your direct competitor for a penny? It’s not worth it. Do you know what to do? When someone sends you a visitor, let him go to a page that says that you do not consider a reliable source: “ believes that it can serve as an intermediary between you and us. We don’t think so. Therefore, we block access from this site. If you want to receive the latest news without delay, please come directly to the NY Post website (or whatever you indicate). ” Of course, will quickly stop sending you visitors. But he will lose from this, not you. There will be news that you will cover better than everyone else. And Michael will have to look for other sources.

The main question, of course, is whether other major players will follow your example? See if the New York Times and the Washington Post do so if CNN, Tribune and MSNBC join in? I'll tell you what will happen. Then all the aggregators who mediate on the content in which you invested a lot of money will use the content of the Associated Press, Reuters and individual bloggers.

Now all network users will be blown up and say that I'm crazy.These news sites will never do like you. This is not in the internet. And that’s how they respond to all business issues on the network. Large newsmen don’t touch aggregators who don’t completely host their content. Starting with the Drudge Report and further down the list. But you will be an idiot if you do the same. Let the search engines send you traffic. Block the rest. A hit on your wallet will be minimal. The blow to competitors is significant.

2. With the exception of the Wall Street Journal, never sell content in pieces.This only works with content that hits the wallet of companies and citizens in real time. The Journal can be sold by subscription, because if a businessman or trader does not have the right information at the time of publication, they may have serious financial problems. Journal drives markets. You can take money for it. The sixth page does not move. Fox Sports is not moving. Here people will not pay for each article. They will not pay for their interest or newspaper, TV, sports site every day, week or month until it affects their wallet. Even if there are such, then they will not be enough to cover your expenses for the maintenance of these sites.

So what do you do to sell your online content? First, understand that consumers on the Internet pay well only when the following conditions are true:

1. It’s easy to pay.

2. Anyone can easily determine the value of your content for themselves, while you are clearly asking for less.

2a. Remember that the fact that you see some value in the content does not mean that the consumer will see it either. Newspaper sites are a good example of this. The consumer, perhaps, believes sacredly that your reporters are better than the Associated Press. He may believe that your site is reporting news that you will not find on But, unfortunately for you, since all this is free, none of them will say: “Wow, you! I used to pay $ 2.99 a week for all this, but now Fox offers only $ 2 a month for the same thing. " This will not happen. Rather, it will be: “I love the New York Post. I love the sixth page. But I’m not going to pay for what I’ve still received for free. ”

Like this.

I will give you an example. Offer a "Newsletter Subscription", which will include:

a. Access to all News Corporation news sites around the world except the Wall Street Journal. From the New York Post to the English Sunday Times, Sun, etc.

b. Two books to choose from from our collection of Harpers Collins. Yes Yes. Choose any two from our bestseller list, or from a special list we made for newsletters like you. Choose yourself which format suits you best: binding, paper cover, e-book.

from. Subscribe to our Wickley Standart news magazine. Choose a delivery method: electronically or in print, or both!

d. 99 bucks into the account in our Fox Store, which we made specifically for our newsletters. Choose from the latest DVD releases to the classics!

To summarize. In addition to subscribing to all Fox sites for 79 bucks a year, you get: two books from the Harper Collins collection for up to $ 79; Wickley Stand subscription for up to $ 64; credit 99 $ to the account in the online store. The total cost is $ 321.

Since newsletters are very expensive for us, our offer is valid for a limited period of time. This amazing subscription will be yours at a uniquely low price of just ... $ 9.95 per month with a minimum subscription period of 15 months!

You can also subscribe to the Wall Street Journal for $ 5 a month, or home delivery for $ 9.95 a month.

I gave this example to make it easier to understand the meaning. Of course, there is nothing new, as publishers of statistical reference books and book clubs have been doing for a long time. Give the subscriber a serious bonus for seed. The cost of all of the above is somewhere around $ 100. If you try, you can make the set cheaper. The most important thing in this distribution is that you receive subscribers cheaply and, possibly, make as much money on them in the first year as the subscription to the New York Post and the Sunday Times combined.

Of course, you can make a subscription to movie and TV lovers, and sell it to visitors to Rotten Tomatoes. You can also subscribe to sports fans and sell them to visitors to and other sports sites.

As soon as I got a subscriber, further it is Fox's problem to make him happy.In fact, not so difficult. Here you can use your digital assets with minimal shipping costs. Give movie lovers the opportunity to download something of their choice once a quarter. You know which films are not in demand. So why not get them to work to add value to your subscription?
Sport lovers offer the same thing, just give a choice from sports films. Free Fantasy Sports in the same piggy bank. Only followers in chats. Sponsorship meetings with athletes across the country are also only for subscribers. I'm sure News Corporation employees are much more creative than me.

I don’t know how everything inside you works, but I’m sure that I will be right if I assume that any of your employees says: “Yes, everything sounds great, but do you think there are great chances for coordinated work of all departments? Each has its own budget. They will not help sell their subscription online. ” Here the dog is buried.

Rupert’s and company’s problem is not whether they can or will not be able to take money for content and make money on it. This is not the difficulty. The difficulty is that it is extremely difficult to set up any large company for one purpose. I am sure that they will be able to sell their content if they competently form subscription packages. I'm not sure if they can reorganize themselves for this.

And since I'm reviewing Fox / News Corp, let's look at their MySpace division. That's what I think. You have serious (albeit seeming weakening) positions in music. Look closely at the economics of music and see how you can use it to your advantage. Today, it seems no one makes money on music. In any case, the "luminaries" say that no one should. That everything should be handed out free of charge, and money should be made at concerts. In general, this is not my money, but I think that MySpace should spend money on music. Take Walmart for example. They buy exclusive CD musicians that are suitable for their target group of buyers. They seem to have signed a contract with Foreigner, who are about to release their first CD in more than ten years. They guaranteed them a minimum quantity with no possibility of return (if the conditions are the same as I read in other cases). You can only buy such a CD at Walmart.

So why doesn't MySpace do the same with those musicians who are suitable for their selection? I don’t know how much a musician will make from Billboard lists for a year from selling his music, but everyone has a price. If I were you, I would recognize her and see if it is profitable to buy their product once and sell it exclusively through MySpace.

Then you can offer a subscription to their music for a ridiculous price. For example, $ 1.49 per year for all the band’s music released per year. Since you paid a certain amount, your task is to sell enough subscriptions to cover expenses and earn something beyond that.

Now MySpace will come down to buying and selling music to its users. Users are happy that they receive content for a penny, musicians receive a source of income, which they also pay in advance. I don’t know if it will work or not, but it’s definitely worth considering this option!

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