Short Essay : Will paid-knowledge be the next blue ocean for Internet companies?

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Are you willing to pay for knowledge?

“Free”, one of the most important things that the Internet has brought to the world, has dramatically changed economic environment and people's way of thinking. For a long time, “sharing for free” has been the internet spirit that people insist on. It has in a way broken the boundary between the haves and have-nots, has brought far-reaching influence on the business modal of many companies, until now. For example, companies can make profits by “free model”, like many news digital platforms who provide free news content to users and earn revenue by advertising.

Sharing economy is not a new concept, we have Uber for sharing transportation, Airbnb for sharing accommodation, but we haven’t formed a mature business model for sharing knowledge. Knowledge used to be exclusive right for upper class, but new technologies and new digitized sources greatly decrease the cost of knowledge, making more and more knowledge, information and wisdom accessible and affordable for more and more people.

“Information wants to be free” was once a strong slogan. But it seems the situation is changing now. What if knowledge and information online has to be paid? Will the strategy save some internet companies who burn lots of money?

Why the concept “information wants to be free” is changed?

The rapid development of paid-knowledge (知识付费) industry rely mainly on the change of consumption concept and the development of mobile payment technology.

From an economic perspective, people’s consumption structure has undergone changes, people are more willing to pay for products with higher quality and better service. When the Internet lower the threshold for diffusing knowledge and information, the quality of information varies. People regard buying knowledge of high quality worthwhile, for it’s a way of investing in themselves. At the same time, the way of acquiring knowledge has changed as well, from books, PC to mobile devices, from a passive position to initiative seeking. These kinds of concepts give birth to business logic for paid-knowledge.

Also, there are complex issues of copyright and intellectual property rights when content are provided free online. It’s a way to protect rights and interests of creators that should be encouraged.

Examples of “pained-knowledge” practice

Ximalaya FM (喜马拉雅FM) is a Chinese online audio service platform that enables users to share audio and personal radio stations. Since last year, it has cooperated with several publishing companies to make paid audio books with high quality, which will become the main part of its paid content on the platform. Audio books that produced by PUGC model has been one of the most popular content on Ximalaya FM, which all used to be free for audience. Ximalaya thinks valuable and professional content need to be paid, so it has made the first move to turn a part of knowledge-oriented audio books to “paid-content” model, while keep the ones with entertainment-oriented content remain free. It works out pretty well by now, but how to create a new and sustainable modal to perfect audio book industrial chian still face big challenges.

In 2016, Zaihang.com has launched a product called “Fenda” (分答), which translates to “one-minute answers” in Chinese, are encouraged to make some money by either asking or answering questions. Those with some knowledge to share can set a price from one yuan to a few thousand yuan for answering a question. The answers are delivered via voice message, capped at 60 seconds. Users can pay the preset price and ask any kind of question to whomever they want on the site. For one yuan, other users can simply eavesdrop and listen to the reply. The more users eavesdrop, the more money question-and-answer participants are supposed to make. According to data from Zaihang.com, Fenda recorded more than one million paid users within the first three days of its launch.

These two typical practices have made more and more people look more attention into the still new market – “paid knowledge”.

Will “paid-knowledge” be the next blue ocean for internet companies?

Besides of some paid-knowledge attempts, it’s still a blue ocean for the market. If internet companies could make good use of blue ocean strategy to develop the market, not only they can capture a certain number of loyalty customers, but also make profits by such new business modal.

Despite different industrial chain behind different knowledge forms, this market has some same patterns considering the ERRC grid for blue ocean strategy. For “Eliminate” grid, companies should eliminate inferior content on their online platform as much as possible, if users consider your platform worthless, they will not pay for it; for “Reduce” grid, some marketing spending on other free content could be reduced. Advertising revenue might be cut down for better user experience. Giving up some free offering may lose part of the users; for “Raise” grid, most importantly, the quality of knowledge and content need to be improved, only knowledge with high quality have the value to be paid for. More focus should be put on the marketing strategy for paid-knowledge; for “Create” gird, unique content, and attractive acceptable forms of sharing paid knowledge should be created with good usability to increase user interaction.

But there are always free content existing, “free” concept still influence people’s mind about the Internet. The “paid-knowledge” market has a long way to go.

Reference:

1.     联手多家出版社，有声书付费会是喜马拉雅的下一片蓝海吗？

http://www.jiemian.com/article/822489.html

2.     A yuan for your thoughts? Fenda provides Service for one-minute answers

http://www.scmp.com/tech/china-tech/article/1962292/yuan-your-thoughts-fenda-provides