Information is free. That is the principle upon which the 21st century has been built. This naturally puts newspapers and online news publishers in a tricky position, besides essentially changing the way journalism has been viewed over the past century. The internet has allowed numerous players to enter the market, challenging traditional publisher, and giving readers the largest number of choices to get its news from. Charging readers is only going to drive them further away to sources of news that provide the same information for free. So, how does a publisher ensure free content for its readers and sustain itself, at the same time? After all, journalism isn't a cheap industry. So, how do you monetize free content in ways far more effective than what we see today?
Sharewall (London) is the latest in technology to offer solutions to publishers for this interesting predicament by monetizing sharing.
YourStory interviewed Anders Ibsen, CEO and founder of Sharewall to discuss his idea, and the journey that came to be with it.
What inspired the idea of Sharewall?
It was basically triggered by a media executive who was a keynote speaker at a conference called New Media Days. He was addressing the problem of the lack of performance of paywalls, and the lack of earning from online publishers. I started to look into the nature of why people are not adopting these paywalls.
It’s mostly seniors that used to pay for printed papers that actually pay for these paywalls, typically because it’s bundled with a printed paper.
So, I started to look into the character of the content. You will see that there are usually two main piles of content: one is nice to have content, and the other is need to have content. For instance, if you are working in a bank, then you need to read Wall Street Journal or Financial Times, and what have we, because it’s crucial for you to do your work. Typically, the bank is paying for the content; there is a very high willingness to pay money, otherwise. But, everything else like sports news or fashion news is characterised as being nice to have. So, people have a very low willingness to pay.
I started looking into transaction economies; to try to figure out what currency we could use to do these transactions, because everything we more or less do is a transaction. What we did was we invented a currency called social sharing, where, basically, the way you ‘pay’ for the content is signing up through a social network and sharing the article. The publishers get their content amplified throughout the social network and grow their readership. For instance, if YourStory wanted to use it, they basically embed one line of code in their website. It’s plug and play solution. It signs the user up, checks the frequency of the articles – say 15 articles – the user reads, after which you have to share one of those articles on a social network of your preference.
What happens then is that if you have a lot of friends on Facebook, they look through the articles, too, and you get better attention to your content. That’s one advantage of this system.
How does Sharewall solve the publisher’s problems?
Social sharing in itself is not what we call a hard currency. It doesn't really bring that much money, so what we have done is that when people sign up they also give their email addresses. What’s interesting about email is that it’s the second largest source of e-commerce, only exceeded by search. Search is about 30%, and email is just behind with 27%. We've seen this with a lot of recent start-ups – with media partnerships that have harvested tonnes of email addresses, and they've built crazy revenues within a short period of time.
So, contrary to that, most publishers are relying on banner advertising for revenue, and what’s interesting is that it accounts for only 3% of the revenue. There‘s a huge difference in what advertisers and people are willing to pay for being a part of that.
What we've done here is that we've built a full-fledged email marketing engine that is hooked up to advertising, and that’s a big monetization part for publishers.
Are there any competitors in the market that offer similar solutions?
I have no knowledge of any direct competitors. Depends on how to define one, because it’s, at the end of the day, how you monetize your content. Paywalls we don’t consider that competitive because they’re in a different ball game if we think about open and free press.
We have signed some significant customers. They've not gone live, yet. We have run tests that deliver amazing numbers.
I've been doing online media for 15 years, and I have never seen anything like this, and it’s quite encouraging to see how we tick these strategic boxes for publishers when we approach them, so that we are directed to the group CEO. This is because it becomes strategic to them to collect data from users to get deeper insight, to develop a social profile, monetize sharing, which are things publishers are desperately looking for.
What is the future for Sharewall?
We've have a road map of where we’re going to improve features, of course. Broad characterisation of our plans would be to use data for artificial intelligence such as machine learning.
What kind of challenges do you foresee?
The problem is that many publishers are approached by so many start-ups that are trying to solve their problems or at least what they consider the publishers problem. There is this kind of reluctance from publishers to set something right, because of this. They would like to see the first one go live before jumping in. We do have contracts so that shouldn't be a problem for now. But, it’s always the biggest risk for any start-up- it is to prove yourself, then get in the market as soon as you have proven yourself, and have some real case numbers. Then, the rest is much easier.
Do you have any plans to extend this service to Asian publishers?
Although, we are headquartered in London, we’re already in negotiation with Asian newspapers in Korea, Japan… We don’t have any concrete or specific negotiations with any Indian newspapers. See, right now we have a backlog of contracts. We haven’t followed up on all of the publishers out there- there might be some interesting ones. But, we have signed deals with international publishers that have Indian coverage.