It’s Monday and the big news in our portion of the universe is a report written by Matthew Robson, a 15 year old intern at Morgan Stanley, about the media consumption habits of teenagers. It was picked up by The Guardian and the Daily Telegraph amongst many others and has caused quite a stir. According to Morgan-Stanley, his report is “one of the clearest and most thought-provoking insights we have seen” and it’s been requested by loads of different people within the industry.
The report gives a damning indictment of several different revenue models in one go, and it paints a bleak picture for many businesses, both traditional and online. According to Robson, teenagers do not read newspapers apart from freesheets, ignore advertising, would rather download a pirate version of a PC game than splash out, and are ‘VERY’ reluctant to pay for music. In short, teenagers are not used to paying for anything, and ignore the advertising which supports free, legal content.
It’s true that as these teenagers get older and have more access to disposable income they may be willing to pay for services. And it is also true that teenagers tend to more anarchic and anti-establishment, and therefore more likely to download illegal content than your average forty-year-old. And many have greeted the report with some scepticism as some of the claims about buying habits seem to be flawed – for example, what teenager buys the broadband for the house?
But there is still a big problem. What this report illustrates so well is that we have an entire generation which has been brought up during the Web 2.0 boom to believe that they can get everything for free.
There are some, as mentioned by my colleague Matt in the previous post below, such as Chris Anderson, the editor of Wired in the USA, who believe that the free model is a natural evolution. But to my mind, this report calls this into question as there needs to be something which supports the free content.
If the next generation of consumers isn’t willing to pay for content and doesn’t pay attention to advertising, we have a serious Catch-22 on our hands. Either advertising is going to have to evolve in a big way, or online companies will have a tough battle on their hands to convince consumers to pay.
One disclaimer: it should be noted that this report was one boy’s insight and shouldn’t be taken as a de-facto guide to teenagers. However, it does raise some very interesting points worth debating!
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Who would use google over the latest yellow pages tome if you had to pay for the information? The availability of content versus the inability to monetize the transaction of information is what makes the internet the internet.
Unfortunately, it seems that as this younger generation gets older they are not paying for premium content, but feeling entitled to information. Entitlement is a huge issue that extends way beyond the question of funding via advertisements for online content and traditional newspapers. The internet has provided the idea of instant availability. So how does one reconcile the difference between finding information on Google or Wikipedia (e.g. “What’s the name of ____?”) and leisurely watching “illegally” downloaded TV shows?
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