Pay by the story
All Mike Gehl wanted was to find a good restaurant. That simple quest resulted in a start-up company aimed at making it easy to charge and pay for individual articles on publication websites.
"I was in another city and I wanted to go out to a restaurant," Gehl recalled. "All the restaurant reviews were behind a paywall. I didn't want to get a subscription. I just wanted to pay 30, 40, 50 cents, whatever it may be, to read this review."
Gehl isn't in the newspaper business. Based in Brookfield, Wis., he's a mechanical engineer involved in research and design for a number of companies. But he runs into paywalls frequently while on the Internet and he began to think about a model for publishers to charge for individual stories and readers to pay for them.
The result is iMoneza. Its website, www.imoneza.com, describes its function this way: "a simple yet powerful cloud-based payment gateway with digital wallet and integrated paywall components specifically designed for micropayments and digital media."
The emphasis is on "simple." A publishing company creates an account and iMoneza "drops a snippet of code" onto the company's website. The process takes less than five minutes.
The publisher can then decide among several options. It can charge for some articles but not others, choose how much to charge, set the charge to decrease as an article ages, and offer different types of subscriptions depending on what a reader wants.
From each article or subscription, iMoneza takes a small cut – the rest of the service is free – and transfers the rest of the micropayment into the publisher's account.
The consumer, meanwhile, sets up a "digital wallet." He or she deposits money into the wallet using a credit card. If the consumer wants to read a story on a participating website, the charge for that story, say 25 cents for example, is deducted from the wallet. The reader doesn't have to put a quarter here or $1.25 there on a credit card just to read one story.
"It's a huge selling point if I'm a consumer. I only have to give my credit card out once," Gehl said. The consumer feels more comfortable, and the publisher has a potentially profitable alternative to the standard paywall.
"There really hasn't been a good way, an easy way, a way that makes sense, to charge for content individually on the Internet. It becomes an easy, simplistic way to do it," Gehl said.
The system challenges the traditional "all-or-nothing" subscription model newspapers and other publications have used, he said. "I think newspapers and other publications are really a good market for this, because a lot of them are struggling on how to transfer their business model from being a print publication to being largely a digital publication."
Lacking newspaper experience himself, Gehl hired Randy Hano, a 30-year veteran whose resume includes the Chicago Sun-Times and the Boston Herald, as executive vice president/sales.
The success of the system depends on publishing companies opting in. IMONEZA is only 15 months old and has been up and running for less than two months. Its first client is Rhode Island Monthly, a city and regional magazine. Gehl expects to sign a couple more in the next few weeks.
"My guess is that most if not all our customers here in the first month will be traditional publications that rely primarily on their print subscriptions for their revenue, whether those are a combination of monthly magazines, or business journals or small weekly newspapers."
Gehl said his research leads him to believe that publishing technology will evolve toward consumer individuality. Readers will be more likely to pay for articles that have length, depth and credibility rather than brief posts and quick-hit stories. The system may also favor freelance journalists who can provide substantial pieces in return for a cut of the revenue.
Whatever happens, technology will continue to change, he said. Publishers can't continue to rely on what's worked in the past.
"I think there's a place for real news, local news, that's worth reading. But's it's going to be on an individual article basis. And people are going to pay for it."
For more information, contact iMoneza President Mike Gehl at email@example.com.
Jane Nicholes, a regular contributor to the eBulletin, is a freelance writer and editor based in coastal Alabama. She is an award-winning veteran of more than 30 years in the newspaper business. Reach her at firstname.lastname@example.org. Nominate your company for an associate member spotlight article!