I’d Buy That For A Dollar
The announcement of the new Apple TV model two weeks ago brought with it a revised media rental pricing tier, with the ability to watch a TV show for a specific period of time for $.99. Interestingly, most of the conversations that I heard were not about who would buy in to this new model and pay for individual shows, but rather which system was the best way to replace your cable box. Focusing the debate on the literal content and devices playing digital media made it more clear than ever that we’ve moved into an entirely new era of how we interact online. People are now willing to spend money to make the internet work for them.
The idea that people won’t pay for anything online has always been a fallacy. The truth is that people won’t pay for something they’re unsure of, that they don’t understand or trust. The internet was new when those arguments rang from every annual corporate meeting. It was easy then to see online consumption of media in black and white: stolen or given away at no cost (and for no profit). While that was true at the time, it was perhaps a necessary part of the process that has brought us to our current state, where users trust that their money was going towards something that they could get value from. The perfect example of how this will play out has always been right in front of us on a daily basis. TV.
For the first 50 years of television, you bought a set, put up rabbit ears, and the signal was free. It was a one time purchase, but you had limited choice of what to watch. When cable TV was initially offered, there was an uproar. Surely no one would pay for more channels. Why pay for something you could get for free? How much TV does a viewer need? Turns out, a lot. People “needed” much, much more. But it took a while to get there. For the first ten years of my life, I only watched cable at my “rich” friends’ houses. It was a luxury, and one I felt lucky to have when my folks finally got it. By the time I went to college, cable was a given. Today, I pay extra each month for HD and HBO without a second thought, because I feel I get true value from each dollar I spend (assuming Boardwalk Empire is as great as it looks). Thirty five years ago, that would have been a crazy notion, yet here we are, and here we go to the next phase of digital consumption.
That’s what the past few years of Web 2.0 has been, creating the free networks that instill users’ trust in the internet, enough to pay for added value. Facebook, Twitter, MySpace, YouTube. These are the ABC, CBS and NBC of the internet generation. They got people using the web in a personal manner, trusting it, and now they’re willing to pay to make it more personalized. Buying a song in iTunes to put on my laptop, my iPhone, and my iPad is a one-click convenience that gets me my music as I want it, the way I once felt when listening to a band’s song on their MySpace page. Renting a TV episode for a flight home is no longer a question of how I can download it, do I have the hard drive space and how do I transfer it. It just arrives on my chosen device, just like my Twitter feed, or my Facebook updates. The trust transfers.
These ideas are now being translated into the next steps of buying apps to help bolster my productivity with free tools that I use daily. I’ll spend $2 to use a better Twitter aggregator instead of the free website. I’ll pay $3 for an iPhone version of a Flash based game I can play for free in my browser. I’ll pay $10 for a complimentary toolset on my iPad for my office productivity set. I know these apps and tools, if used correctly, will make my life easier and therefore better. As an end user, I (like many of you) have cleared the hurdle of trust, and now it’s just a question of priorities: what will I choose to enhance my online and digital experiences. It’s no longer a question of IF I’ll use them, HOW I’ll use them, or WILL they work. It’s now just a question of how I choose to enhance my online and digital experiences.
With that trust in place, specifically within the younger demographic, who never really had to question online transactions, it’ll be very interesting to see how that mindset transfers into higher education. Everyone has come to accept that the era of the digital textbook and online exams will be here to stay soon, but what of the customization tools? Sure, the student has a textbook, but will they pay $2 to hear a visiting professor explain the chapter in more detail? Will that $10 collaborative notes program for their tablet, allowing users to collect and sort the notes of the entire class, be worth it for all of the students? Not only will our comfort level with customizing existing technology change the way students learn and faculty teach, it will also change the way that institutions of higher learning realize revenue. At least until the next digital revolution comes our way.
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