Content is still king, but now it has to share its crown. Justo Hidalgo (@justohidalgo), co-founder of 24symbols and a panelist in the “New Ways to Sell” session at the upcoming Tools of Change for Publishing Conference, believes added value and personalized services are just as important as the content itself. He explains why in the following interview.
In what contexts does content aggregation create the most value?
Justo Hidalgo: Companies that take content and contribute added value for readers are generally better positioned to succeed. Specifically, I believe content aggregation is useful in the following contexts:
- Hubs — Why did The Huffington Post gain so much success? Why is Spotify increasing its number of users constantly? And why is Netflix in trouble? There are of course many reasons, but one is particularly clear: Users want hubs where they can find most, if not all, of the content they want. Content aggregation enables just that. While creating silos of information can be valuable in specific niche markets, it does not work in mass markets unless your brand recognition is immensely high.
- Value addition — Social recommendation is a typical yet good example of value addition to content, as is adding information about a title’s author and surrounding context. This meta-information can be manually or automatically added. I believe in the power of machine learning and data mining technologies applied to this area, along with human expertise.
- Discovery — While having thousands or millions of books complicates a search, it also creates an impressive opportunity: There are more relevant datasets to match recommendations and tastes as well as to facilitate serendipitous discovery.
How about paywalls — is anyone doing this properly? What is the best way to make this model work?
Justo Hidalgo: Paywall models only work if what you offer is extremely exclusive. Maybe the New York Times or the Financial Times can succeed at offering paywall content, but in a digital world absolutely nothing can be prevented from being copied and propagated. So the key is not the content itself, but the value-added service offered on top of it. Only a mixture of high-quality content and a great service will be compelling enough to make users pay.
In general, the content — and the service that contains it — needs to be testable, and models like freemium, whether “free” is forever or for a limited time, are critical in the digital content world. Spotify is creating a massive user base with this model, even now that its free offering is not as compelling as before. The New York Times is also using a freemium approach, letting its users read a few articles per month for free before the paywall kicks in.
The challenge of paywalls in this context is that high quality is not only expected, but required. With so many good free sources of information available, if I am to pay for it, I expect it to be impressive — not only in terms of pure content, but also in terms of the benefits the service provides in a personalized way.
24Symbols is based on a subscription model. Since your launch, have you had to change the model to make it work?
Justo Hidalgo: Pivoting is inherent to any startup. We made some changes to our product strategy, like focusing on the HTML5 version before the native apps for iOS and Android.
In terms of the model, the basics are the same. We believe a cloud-based social reader with a freemium subscription model is key for the future of publishing. And we recently branched out to license our technology to companies and institutions that want to offer a cloud reader to their customers or employees. This was in our minds from the start, but we wanted to focus on the consumer offering first and create a top-class platform.
This interview was edited and condensed.