Pierre Omidyar launched eBay before many of us were online, and before online shopping was a multi-billion dollar a year market. But blazing the trail of ecommerce may prove to be a much easier task for Omidyar than building paid online news properties.
Yesterday, the Omidyar launched the Honolulu Civil Beat, an online news publication designed to provide content and facilitate conversation around “the important issues facing Hawaii.“
The Civil Beat, which is edited by former Rocky Mountain News editor John Temple, features articles written by in-house staff, and encourages readers to share their opinions.
If it sounds like standard online news fare, that’s because it generally is. But Omidyar is doing something many traditional news publishers have been reluctant to: he’s put much of the Civil Beat behind a pay wall. And that’s where things get interesting. To read most of the Civil Beat’s content or to participate in discussions requires a paid subscription. While a 15-day trial subscription is being offered for 99 cents, the regular price of a monthly subscription after that is $19.99.
That equates to approximately $240/year, which happens to be $137 more than a new annual subscription to the Wall Street Journal Online. Which begs the question: is Omidyar wise not to devalue his product right from the get-go, or is he crazy to believe that enough people will pay $19.99 to make the Civil Beat a viable enterprise?
In answering this question, one has to look at the product. And unfortunately, I think that this is where the Civil Beat falls short. The website itself is a bit rough around the edges, and the headlines and excerpts don’t look particularly compelling or different from what one might read in the local newspaper, although I’m admittedly a bad judge since I don’t live in Hawaii. Potentially more important is the Civil Beat’s reliance on PayPal. Not only is PayPal the only way to pay for a subscription, it’s also required to log in. As paidContent points out, this might be somewhat problematic as not everyone uses (or likes using) PayPal.
In short, I’m not entirely convinced that there’s enough here to entice a significant number of subscribers at the $19.99/month price point, and the fact that it costs so much more than the Wall Street Journal Online, which is in a different market but has a long-standing brand and reputation and more compelling overall value proposition, hints that Omidyar may be going a little bit too far with the concept of ‘paid content‘. I suspect that Civil Beat will do just fine as his small personal pet project, but probably doesn’t represent a compelling model for other local publishers who don’t have a billionaire bankrolling them.