There are plenty of studies that show people are reluctant to plunk down more than .99 for an app they’ll likely use every day. On the other hand, several newspapers have had luck with mobile, paid subscribers.
Now, CBS and Turner are putting the paywall to the test with NCAA March Madness. Though the FAQ on March Madness Live is extensive, it boils down to this:
- Games on CBS will run live on their website, free for all.
- Games on Turner will run free online if you’re an authenticated cable subscriber.
- If you want to watch on your mobile phone or iPad, you’ll have to pay a whopping $3.99. That’s not “per game.” That’s the one time price to download the app.
For sports fans, $3.99 is nothing compared to the ticket price of a live game or even the cost of a pay-per-view fight, but it’s bound to prickle a few people. The main complaint is that cable and satellite users are already paying to see the games, so why should they have to pony up to watch it on their mobile device?
Here’s why. Because CBS and Turner have a right to make some money off the deal, any way they can. They probably could have charged even more money because people will want to watch these games while they’re on the go. All things considered, $3.99 is very reasonable.
What’s more interesting than the March Madness news, is that every major news outlet and a number of mobile and marketing blogs (including this one) chose to write about it. A few even went dramatic with headlines about how the new system will prevent some people from watching the games!
Why all the hoopla? Because charging for mobile March Madness is another step toward destroying the traditional TV viewing model. If a percentage of the audience that used to watch on TV, now watch on their iPhone, what does that do for sponsors? Will the same commercials run across all devices? Are sponsors being charged extra for the people who watch on the iPad or online?
Ideally, we should serve up specialized clickable ads for those watching on mobile or online, while the TV viewers of the same live program watch typical TV commercials. Think what that would mean for digital ad dollars. Think about how that could open up the field for smaller companies to advertise during big ticket events.
The March Madness paywall story isn’t about the networks charging for what they gave away free last year. It’s about changing the way we watch TV and those changes will benefit both the consumer and the marketer.