Wired‘s Anderson: “The Free Vs. Paid Debate Is Misunderstood”

Today, we are staking out Wired magazine’s Disruptive By Design business conference. Wired editor-in-chief Chris Anderson (left) opened the day with a discussion about his upcoming book: “Free: The Future of a Radical Price,” and of course, he eventually started to talk about how the media has been affected by the rise of the Internet.

The Internet allows content to be published for little to no cost to the content provider, so the information can be provided for free. But what newspapers and magazines have failed to do so far is effectively monetize content provided online.

In his talk this morning, Anderson suggested that instead of looking at content as free versus paid, we should consider it as “freemium.” Following the model of The Wall Street Journal, newspapers can provide their exclusive stories and most popular content for free, while niche content can be placed behind a pay wall.

“People are more willing to pay for niche content because they realize how specialized it is,” Anderson said. Following this model, newspapers can hope to draw in readers who are not willing to pay for content and then convert some of them into paying consumers.

We caught up with Anderson to ask him if he saw his own magazine possibly taking on this model and what he sees as the future of newspapers and magazines.

“My point is that the free vs. paid debate is really misunderstood,” Anderson told FishbowlNY, referring to his comments earlier in the day which he attributed to the Journal‘s Alan Murray. “No one is talking about 100 percent paid [content]. We’re essentially talking about ‘freemium,’ where you use free to convert some minority share to paid…this is not a return to some golden age when all media was paid, we’re just trying to figure out how to make money. You don’t abandon free, you just use free to drive business.”

So does Anderson think his own magazine, which currently offers all its online content for free, might go the “freemium” direction at some point?

“Absolutely,” he said, noting that there are three prices for the magazine right now — free for online content, $10 a year for a subscription and $4.95 per newsstand copy — but “we should have 30 prices.”

Although Anderson could not comment on what might be in Wired‘s future, he said to “look to what other people are doing,” from lowering rate bases and raising magazine prices to offering tiers of subscriptions or offering branded events for readers to attend — at a cost.

“The question is can you find a way to engage every price point out there,” he said. “It’s not about charging more for the same products, but releasing different products. [Those products] are not for everybody, but for enough people that we can charge a higher price.”