Pay for compelling content? Why not?

Anderson’s model for the future newspaper industry “paying people to get other people to write,” as he mentioned himself, stemmed just from his personal experience. Moreover, the model seems to be limited to the economics of media down to “hyperlocal level.” Amateurs who are organized and taught by professional journalists and write for non-monetary rewards may be good at covering their own communities. However, it’s a different matter with “news content” to my mind. Information is one thing, news is another. I am not sure, for example, how much one who works as a civil engineer by day and write about something he/she loves by night can gratify the desire for in-depth stories and differentiated content of audiences. The 'Free' information itself does not make money at all without advertising. In addition, although ‘GeekDad’ is making some money from advertising, I don’t think the model can be appropriate for the future of news media industry.

A study (Peitz and Valletti, 2008) compared the degree of market failure arising in two market structures: pay-tv and free-to-air media platforms. While pay-tv has two sources of revenues, advertising revenues and revenues from viewers, free-to-air receives all revenues from advertising. The result showed that free-to-air television tends to provide less differentiated content whereas pay-tv stations always maximally differentiate their content. The study also found that market failures are smaller under pay-tv than under free-to-air. The result may not always be true, but I believe that audiences are willing to pay for unique and compelling content they value.