Online newspapers company are earning something more than money from readers

           This week’s readings are about that why is online information free. Facebook, google and youtube don't charge users but they make a huge profit that hard to be ignored. Why? The reason might be that users are the tools for companies to make a profit. I think it is the nature of Internet, sharing. Companies are making a profit by network externalities. They don't charge users because they need users to earn money.

            The other interesting question came to my mind. Readers are so used to reading free online newspapers but electronic versions of magazines are not free, ebooks are not free. Magazines and books have identical content with print counterpart. Why can emagazine and ebook charge but not online newspapers? Network externality seems to explain why can e-magazine charge but not online newspapers ? People reading online newspapers are likely to share the news they read, by sharing with others, online newspapers company can reach more viewers. This is very different from the way reading emagazine or ebook. Readers don't share magazines but online newspapers.

            Not all online information is free. I accidentally use free trial of Business Insider. It costs $500 per year. Their content is really useful and good. They charge for reasons. Report of Business Insider and online newspapers are digital content, but the former charge a lot. I guess the content for Business Insider is not for sharing. That’s why it charges like e-magazine or e-books. A major difference from people reading print newspaper and online newspapers is that people reading online newspapers are to share. Media companies are not earning money from readers but earning their interpersonal networks and their ”sharing ” to reach larger viewers. 

            If the goal of online newspapers company is not earning money from readers’ pocket but to raise advertising price by readers’ sharing, then the question that “how much readers should pay for online newspapers” might be a wrong question. Probably we need to ask “how to attract audience with free information?” or “how to make online newspapers cheaper than being free?”