When The New York Times announced in 2010 that it would begin charging people for access to its website, it immediately sparked online debate over free versus paid content on the Web. Would loyal Times readers willingly begin paying to browse articles they could previously peruse at no cost? Or would the prospect of a paywall deter so many visitors that the site might crumble? Since the metered subscription service, which allows everyone 20 free articles per month, went live in late March, 100,000 people have paid The New York Times toll, but that represents only a sliver of the site’s 15 million unique visitors.
Print publications in particular have had a challenging time transitioning their subscription- and advertising-based business models to the Web where free reigns supreme. Unless they’re actually going shopping for merchandise, people tend to avoid spending money online. Just imagine how many fewer YouTube videos you’d watch if the site charged admission. This “will they buy?” question is precarious for content providers of articles, music, movies and more because the Internet offers so many free alternatives. Can’t find that Harper’s commentary and don’t want to drop cash on the site’s online subscription? Google until you can find it reposted on someone’s blog.
But just because people shy away from purchasing content online doesn’t mean it never happens. In fact, a 2010 survey from the Pew Internet and American Life Project found that 65 percent of American adults have paid to “access or download some kind of digital content.” What type of online media – as opposed to actual merchandise, like books and shoes -- are we tossing in our virtual shopping carts? The top five things people buy online may surprise you.
Although the music industry was nearly left for dead at the dawn of the digital age due to illegal downloading, people buy singles and records online more than any other type of online media. According to Pew data, 33 percent of Internet users have bought music online.
Last year, digital music sales in the United States stalled after two years of double-digit growth, but downloads were by no means puny. iTunes sales topped $1 billion, and when the Apple music super store released the Beatles catalog for the first time in November, people gobbled up 450,000 virtual albums in a week.
To keep our Internet workhouses running handily, computers often require additional software. While people might not brag about their newest media player download like they might their epic iTunes library, an equal amount of folks -- 33 percent -- buy software online as digital music, Pew finds. The type of software we buy depending on whether we opt for a Mac, PC, or mobile device, in addition to our operating systems. Interestingly, PC users download a host of virus protection software, while more inoculated Mac users spring straight for the media players.
The most popular software download of all time? Instant message service ICQ, which costs exactly nothing.
Slinging birds at pigs: There’s an incredibly popular paid app for that and just about anything else you can fathom. Although the Economist magazine named 2010 the Year of the Paywall, the Year of the App would’ve been a more accurate tech forecast.
And while there are thousands of free apps people can download to their iPhones, Androids, BlackBerrys and other mobile devices, an estimated 21 percent of Internet users have paid for them as well. Early last year, analysts projected the app market to reach $15 billion by 2013, just including smartphones, and the Apple App Store has already served up more than 10 billion downloads.
During the first half of 2010, more people downloaded digital games than bought physical games in stores for the first time. Considering that milestone, it’s hardly surprising that 19 percent of Internet users have paid to play online. The gaming industry wasn’t kicking up its heels, however, since the shift to buying game access and downloads indicates thriftiness on the consumer’s part.
Overall, digital games cost much less to create than console games, providing a lower price for the gamer. In fact, a study from market research firm NPD Group declared that online gaming was one of the rare entertainment segments that didn’t suffer from recession-induced consumer spending losses.
Newspapers, Magazines and Journals
Pew statistics on the percentage of people who have paid to read newspaper, magazine and journal articles seems like an encouraging sign for online subscription sites like The New York Times, The Wall Street Journal and The Times of London. Eighteen percent of Internet users have bought access to online publications before, but that’s where the good news ends.
An April 2011 survey conducted by Harris Poll found only 20 percent of respondents willing to pay for online news, down 3 percent from 2009. This isn’t a case of Americans being a bunch of online misers, either. Canadian Research Consortium found only 4 percent of adults who’d buy online news, and 92 percent said they’d simply find another free news outlet.