Small fees add up fast for media sites

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Media company Web sites wary of subscription pricing are offering consumers the chance to make "microtransactions" for the ultimate online merchandise: branded content.

The logic goes like this: If '90s consumers will pay an extra dollar to order a movie ticket from MovieFone or 25¢ or more for an operator to give them a local phone number, then they'll be willing to pay similar fees for small pieces of important information like archived articles.

While consultancy Forrester Research predicts transactions will bring in less than 10% of media sites' revenues for 1996 and 1997, the microtransactions model could grow significantly if technologies in development allow transaction fees to be listed in a single charge on phone bills.

CONTENT IS KING

Sites like Hearst New Media's HomeArts have shown this medium is driven by consumer interest in content. A banner campaign based on specific articles and content themes showed higher traffic (up to 10% click-through) than more generic banners which generate about 2%.

Now, Clickshare Corp., Williamstown, Mass., is working with The Christian Science Monitor and Atlanta-based FTT on technologies that will let Monitor readers download articles for a 75¢ fee charged to the user's phone or credit card bill.

The service, which will sell Monitor archival material dating back to 1980, could be available as soon as Dec. 1, said David Creagh, electronic publishing manager at the Boston-based newspaper.

Clickshare will register users so they can buy content on any Clickshare-enabled site; through a relationship under discussion with FTT, fees for those downloaded articles could appear on the user's phone bill since FTT has relationships with GTE Corp. and the Baby Bells.

"Our feeling is that there are a lot of people who will make impulse buys on information priced less than $1," Mr. Creagh said.

TRANSACTIONS ADD UP

Clickshare Chairman-CEO Bill Densmore said the key to making microtransactions work both for his company and publishers using Clickshare technology is the accumulation of the many content purchases a single user makes.

Because Clickshare users register once at the first Clickshare-enabled site they use, "this creates an economic incentive for publishers" because they can then create deals and licensing relationships with one another.

For example, one site's registrants might get a free number of downloads or accesses to a partner site's content.

Another opportunity free sites may take is co-branding with a subscription service for a cut of its revenues and renewals. That's a model Match.com, the online dating service affiliated with San Francisco-based Electric Classifieds, has marketed.

Subscription services "get a co-branded Match.com integrated with their look and feel," General Manager Fran Maier said, along with anywhere from 5% to 15% of revenue from the co-branded area which costs users a maximum of $10 per month.

Match.com will rotate a co-marketing partner's banners through the Match.com site and also give the partner a percentage of membership renewal revenues.

Copyright November 1996, Crain Communications Inc.

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