Photo by ehnmark, cc-by license

I’ve submitted two panel proposals this year – each is described below with a voting link.

The first is Who Pays for Content?: Re-evaluating Paywalls. As described in the proposal:

Everyone knows Stewart Brand’s statement that “information wants to be free,”. Less well known is the other half: “information also wants to be expensive.” If no one pays for content, and no one clicks on ads, how will we fund online initiatives, applications, and sites? What could drive users to pay for content? What has, historically, and how can we learn from that?

I think this is a very timely discussion that hits at the core issues for SXSW attendees – what funds the work so many of us do on the web? What models other than advertising and pay-for-content will work in the assembled web?

The other is What’s in it for me? Open Source and Interaction Design. This builds on the video podcast I did as part of last year’s extended content program. As an open source developer and advocate who has also long been a promoter of the value of interaction design, I want to broaden awareness within the interaction design community about why licensing matters. From the proposal:

Open source advocacy has generally focused on the perspective of developers, for whom access to source code is a real need and the opportunity to change or extend functionality is a practical possibility. But what about the interaction design community? In this talk I explore why interaction designers should care about free and open source software.

You’ll have to register to vote, of course. You can also leave comments here or in the panel picker itself.

See you in Austin in March!

Currently, however, they are running a Campaign to Save Paste, soliciting donations to offset operating losses. What does the need for such campaign tell us about the future of online publishing?

Many people, myself included, got hooked on Paste via the CD-sampler which accompanies each issue and lets you hear many of the artists being discussed and reviewed.

Paste has also made interesting moves to reflect the popularity and primacy of the Internet as a mechanism for discovering music, while still retaining their editorial vision and curatorial role.

First, they moved the sampler CD online. Instead of distributing physical CDs with every copy of the magazine sent to subscribers or sold at newstands, the CD is available for download, with subscribers having accounts and print versions containing a code to access the download. Subscribers who prefer the physical CD can still request one.

Digital VIP

• 12 Free Albums (downloads) selected by Paste editors, plus often bonus albums
• Digital versions of the magazine, including access to back issues
• Early access to the sampler and magazine
• A Paste t-shirt
• The ability to give gift subscriptions (not VIP but regular) to friends for $10

It’s a great program – allowing the brand evangelists to pay more and get premium access, while also enabling them to spread the brand. (Disclosure: Paste is not a client. I’m just a very happy subscriber and brand enthusiast!).

I wish, in fact, that magazines like Mojo and Q, which I often buy in print while in the UK, would emulate this model: keep publishing in print, but let people choose to subscribe to a digital edition and get the tunes which would otherwise come on a physical CD online.

None of this, however, has enabled Paste to completely avoid the global economic meltdown current recession. They’re recently launched a “Campaign to Save Paste,” calling on readers, musicians, and other supporters to help them get through what they’ve described as “a little cash infusion to make up for running at a loss for a while.” (See Save Paste FAQs).

The campaign itself is very well executed, including a letter to readers, a Facebook Group, a twitter account, over 70 tracks (many rare and otherwise unreleased) made available by musicians and labels to anyone who donates, and even banners supporters can take and embed on their own blogs, myspace profiles, and the like:

So what does this campaign, and the model of Paste in general, tell us about publishing in the age of the assembled web?

The pessimistic view would be that it demonstrates that even a small, dedicated, niche-focused print magazine can’t survive. Music, film, and book bloggers have taken over the curatorial role and publish mp3s, trailers, and samples – often with less respect for the strictures of current copyright than a published magazine can manage. In this view, even though Paste was doing everything right they can’t survive without the voluntary donations of supporters. Philanthropic patronage is the only hope of the print publication.

A more optimistic view, though, would take seriously the version Paste themselves offer. The model is fundamentally sound, subscriptions are growing, and the future looks bright. As they write in the Letter to Paste Readers:

Long-term, Paste will emerge in good shape. Even with the fall-off at the end of the year, 2008 was our best year yet—print subscribers, print ads, online readers and online advertising were all at record levels. Readers (print and online) remain strong. And new advertisers have come on board even in the recession, with more ready when their advertising budgets come back.

In the meantime, we’ve adjusted our business to weather this storm. We’ve cut costs, and we developed a robust online business that’s among the best in the industry. Fundamentally, we’re in good shape and won’t need another appeal down the road.

I have, of course, no visibility into Paste’s finances and can’t really discern which of these views will be more accurate in their specific case. But I truly hope it’s the latter.

Hope. Which Way? (Photo by bixentro, cc-by license, click through for details)

Mass High Tech, which I still read in print, featured on its front page Richard Anderson from Village Soup and Alan Baker of the Ellsworth American. (The article is online here: Two Maine newspapers test the future of newspapers’ plans). Additionally, there were a number of articles about Amazon’s new Kindle, and how e-Readers in general might represent new hope for publishers.

Approach one: hyperlocal, shared platform, business-sponsored

Village Soup sign in Belfast, ME (Photo by Timoth Valentine, cc-by-nc-sa license, click through for details)

Anderson’s model, which you can experience in a number of communities linked from VillageSoup.com, is essentially a hyperlocal model, in which a significant portion of revenue is driven by sponsored blog posts, which VillageSoup calls bizOffers:

The most distinctive component of our model are the sponsored postings . . . that businesses can buy. The posts, which run right next to the ordinary editorial content, are not controlled by us. No fetters, no filters.

In the two most mature of the four markets we serve, the sponsored blogs help generate a large portion of the online sales that collectively generate 19% of our $2.5 million in annual advertising revenues.

(You can see the bizOffers in action in the right column of the Knox County Village Soup site).

VillageSoup also received a Knight Foundation News Challenge grant in 2007 to

create an open-source version of VillageSoup’s successful community news software, combining professional journalism, blogs, citizen journalism, online advertising and “reverse publishing” from online to print.

Unfortunately, I wasn’t able to locate a meaningful update on their progress in that direction. There is some discussion of code access under the name “Village Soup Common”:

How does this model work?

VillageSoup handles the technical stuff. While a version of the platform code is available free, the installation, maintenance and improvement of the code is not. Software engineers and connectivity costs can be shared among all members of the Common. VillageSoup also allows provides the brand and its promotion. This promotion goes in two directions. To the public, we promote theSoup as a trusted source for hyper-local information around the globe. To the major product brands, we promote theSoup as a direct connection to the hyper-local residents as they head to their local retailer. Finally, a VillageSoup Common wiki provides a repository of experiences and ideas which empowers small operators to learn and advance in ways not achievable as stand-alone entities.

As one of the commentators on Anderson’s recent blog entry on making hyperlocal pay pointed out, however, that doesn’t seem likely to be what the Knight Foundation expected when it funded creation of an open source project. Perhaps we’ll hear more as the end of the grant period (June 2009) approaches?

Regardless, it stretches credulity to think of hyperlocal as a new strategy in 2009. Hyperlocal undoubtedly plays a role in the future of news publishing, but it is unclear whether it will produce the kind of revenue necessary to significantly impact the large publishers who are in trouble.

Approach two: rebuild the online paywall / make users pay for content

Not free (photo by ol slambert, cc-by license, click through for details)

Users are offered, on the landing page of the Ellsworth American, a choice: go to the free limited edition of the paper, a site called FenceViewer which offers summaries of stories from the paper, or subscribe:

The full Ellsworth American is available weekly as a PDF download to those willing to pay a $32 annual subscription.

While paid subscription to online newspaper editions is something the rest of the industry has struggled with – famously only the Wall Street Journal has been able to maintain a paywall over time – the paper is hopeful in the case of this small Maine community, perhaps due to its niche presence:

The Ellsworth American’s payment strategy serves an even narrower niche. From 12 percent to 15 percent of its subscription revenue is in mail subscriptions — typically snowbirds who get the paper by mail during winter months. Problems with the postal service have taken their toll.

So far, about 100 readers have subscribed online, said Chris Crockett, the paper’s IT manager, but it’s still early in the process. There have been “some comments,” about the new model, he said, but many people have been satisfied to be pointed to the paper’s trimmed-down free site.

Is 100 readers subscribing only a sign of hope, or yet another sign that users don’t want to pay for access to content online? While it may be too early to tell for Baker and Crockett, the rest of the web seems to have pretty clearly voted on this one already, and recreating an information scarcity economy seems unlikely.

Approach three: sell content on new devices

Kindle (Photo by Brian Vallelunga, cc-by-nc-nd license, click through for details)

While new devices can certainly reset user expectations – look at the influence of the iPhone on mobile web applications in the U.S. – it is difficult to imagine that such devices will create a market for paid content that replaces the drastic decline in traditional subscription revenue.

Additionally, while the gadget sites and tech press have been quite excited about the new e-reader formats, it’s hard to imagine proprietary format readers ever becoming nearly as ubiquitous as mobile phones and netbooks using existing open formats. As Alan Mutter puts it:

Instead of trying to persuade consumers to adapt to an expensive, awkward and idiosyncratic gizmo like the wide-body Kindle, newspapers would be wiser to spend their time and resources optimizing their existing offerings for the interactive formats already in popular use. Netbooks are already here, growing in popularity, and much more likely to find broad acceptance than dedicated readers.

While some users will adopt, and evangelize for, e-readers of various styles, they’ll never match the audience of the web (and the mobile web). If developing for those formats requires significant investment in proprietary formats (and associated DRM technologies to enable paywall and prevent piracy), publishers risk again missing the bulk of the audience. (See also MG Siegler’s excellent Tech Crunch post “The Big Screen Kindle Hail Mary To Newspapers Will Fall Incomplete“).

Users in the assembled web expect to be able to consume (and share, and interact with) content where they are – in social networks, on community sites, and throughout the web. Content I can’t share is inherently less valuable than content I can. In other words, what makes the e-reader story so attractive to publishers – relatively closed (non-generative) platforms which enable paid content subscriptions – is exactly what makes them unattractive to most readers. (Or, to put it another way, piracy of paid content will be what makes them attractive).

Will the short-term gain (a bump up in revenue as the initial readers roll out) be worth the long-term loss of taking focus off making the web work?

No silver bullet

Ultimately, all of these strategies (hyperlocal sponsorship, paywalls for niche web content, and new devices/new formats) can contribute to the evolution of existing publishers into new media, but none of them represents a silver bullet. Publishers need to focus on reigning in costs and eliminating unnecessary duplications of effort, while at the same time generating compelling content which will attract audiences that advertisers desire, and even potentially be worth paying for.

In the Project Charter (curiously only available as a PDF), they lay out these business goals:

• To further embrace and demonstrate the principles of open source development, distributed services and open web standards as a foundation for viable web-based businesses.
• To promote the use and benefits of software features that encourage constructive social interaction.
• To create revenue channels sufficient to sustain and grow Ma.gnolia.
• To ensure that Ma.gnolia can survive and remain useful regardless of the status of Gnolia Systems.

Refreshingly, though, they don’t stop with business goals – they also lay out community goals and individual/organizational goals:

Community Goals

• To enjoy the benefits of shared web-based resources with a minimum of interference from destructive uses, such as spamming.
• To create and strengthen relationships around mutual goals and interests.
• To create and participate in public and private areas for sharing web-based resources.
• To have a sense of control and safety in the use and future development of Ma.gnolia.

Individual/Organizational Goals

• To enjoy presence in a social application with a minimum of interference from destructive uses.
• To have confidence in the reliability and security of the service, and the protection of private information.
• To build social capital with chosen peers in the Ma.gnolia community and/or other communities that
  the service can interact with.
• To enrich personal and/or organizational use of the web as a research, discovery, collaboration and
  publishing tool.

The charter has more to say about the different activities involved in the overall M2 project, including a description of the various communities, products and services which will make up the M2 ecosystem, as shown in this diagram (click for full size):

It’s great to see a company looking at its offerings as an ecosystem involving various kinds of participants, corporate and individual, technical and non-technical, and across many different usage scenarios.

It’d be great to be able to use the open source version in the context of other projects, where relying on the service may not make sense.