Economics of Online Content

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Slides from a talk given at the Info Valet conference at George Washington University. http://www.journalismtrust.org/

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  • My professors quite often warn me that economists are particularly bad at predicting the future. I used to say we leave the useful things like that to the finance majors, but given recent performance, it’s maybe not so accurate
  • Why do we charge all these different people the same, when clearly the value they have for news is very different?
  • My professors quite often warn me that economists are particularly bad at predicting the future. All the economic theory in the world won’t teach you how to be successful in business, have to go out and try it out.Also:ECON traditionally looks at GOODS and SERVICES. GOODS are tangible, SERVICES everything else. So production of information is in a strange spot.ECON also typically depends on SCARCE resources. Bandwidth and time online are increasingly NOT scarce.
  • Consumer and producer surpluses
  • Note to J-schools. Teach this stuff!Along with a comp sci. class. (And not some wishy washy put HTML in your website one)
  • Why is this demand curve differently shaped?Elasticity
  • Timeliness is keyWhat’s crucial immediately to a political operative or a business leader might be able to wait for a casual reader
  • Economics of Online Content

    1. 1. Some Economics of Online Content By Albert Sun
    2. 2. Hi Everybody! Albert Sun albertsun.info  Class of 2010  Majoring in Economics and Math
    3. 3. So what am I going to talk about?
    4. 4. Who else flew here today?
    5. 5. One price fits all?
    6. 6. Some ECON 101 “The economy depends about as much on economists as the weather does on weather forecasters.” -Unknown
    7. 7. Supply and Demand Price Supply Market Price Equilibrium The market clears! Demand Equilibrium Quantity Quantity
    8. 8. Price Discriminate! Price Demand Quantity
    9. 9. How do we apply this to journalism?
    10. 10.  For each target audience what shape is their demand curve? What does the demand curve actually look like?  For any price change, how much will traffic change? The shape and elasticity of demand give key questions to be answered by every news outlet.  What numbers do we label the axes with?
    11. 11. Imagine… Price $24.95/m $14.95/mo Free! onth nth Read all our articles online! X X X Early sneak peeks, get vital information up to a week early! X X Read it anywhere! Full RSS feeds, on your mobile, and audio versions. X X Opinion leader? Your comments start with extra karma and higher placement X
    12. 12. Discussion How can you target your product at different audiences?
    13. 13. Photo Credits  http://www.flickr.com/photos/rene_ehrhardt/2391114010/  http://www.flickr.com/photos/kevinsteele/1507196484/  http://www.flickr.com/photos/extraketchup/622612084/  http://www.flickr.com/photos/86921622@N00/1403809229/  http://www.flickr.com/photos/andyinnyc/2491395142/  http://www.flickr.com/photos/bjmccray/515435761/  http://www.flickr.com/photos/btindrelunas/2250204291/  http://www.nwa.com/travel/perkchoice_demo_html/  And http://en.wikipedia.org/wiki/File:Economic-surpluses.svg

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