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Yahoo is moving content from paid to free

By September 17, 2009 No Comments
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At a time when newspapers are considering how they can start charging for online content Yahoo is moving in the other direction.  The FT reported this morning that Yahoo has removed the paywall from in front of their realtime stock quotes and from their US Fantasy Football site which charged for premium services including realtime football scores.

This is interesting because it will now be harder for newspapers to start charging for their online content (particularly as Yahoo is also considering increasing the amount of commentary it provides with its free news product) and because timely information is one of the things that theorists have been saying might remain chargeable as many things move towards being free.

In one of my early posts on the ‘free’ subject I quoted Kevin Kelly’s list of eight things that will remain chargeable in a world where the price of many (or even most) things is heading towards $0, and number one on that list was ‘immediacy’, the notion that people will pay to get something before everyone else.  The trouble with this idea is that it ignores one of the central pillars of the ‘free’ argument.  The theory has it that when the marginal cost of delivering a product or service trends towards $0 the price will also trend towards $0.  By this logic the price of immediacy will trend towards zero (in most cases at least), after all the underlying cost of delivering a stock price fifteen minutes delayed is the same as for a live feed.

Yahoo’s move to stop charging for the immediacy of financial information and sports news can be understood in this light.

Business decisions are made a little differently to this of course, and the reason that Yahoo gave is that the small amount of revenue they were generating by charging for the live information wasn’t enough to justify degrading the experience for non-paying users of the service.  This tells us that on average the public at large didn’t value the immediacy that highly.

As I was reading the FT piece I was thinking that just as the marginal cost of immediacy is trending towards $0, so is the marginal cost of mobility, or more precisely, getting content onto mobile phones, and that content owners hoping to make good by charging for mobile access should think again.  Half way through the article I read that Yahoo are thinking the same way and have dropped the charges for their Fantasy Football iPhone app.  I expect that this trend will generalise, and the average price of iPhone apps will continue to decline.  Moreover, when Apple gets the in app transaction model right my guess is that the rate of decline will increase.

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