It is a question that is almost as old as the web itself – how do you get people to pay for content, and specifically journalism, online? As a news distribution platform, the web is unparalleled, but as a news business platform, it is rather more problematic, as the recent debate about online advertising and the rise of adblockers has demonstrated.
It is a problem that two Dutch journalists have decided to tackle by trying to implement an old idea in a very modern way. Three years ago, Blendle cofounders Alexander Klöpping and Marten Blankesteijn were standing at a news stand, considering the array of newspapers and magazines before them.
“We realised that there is so much content being produced and so many beautiful articles being written every day or week or month, and it is very hard to find the articles of most relevance for you,” recalls Klöpping. “You almost want someone to tell you this article is great and then tear it out and only pay for that article. Also, in Holland there was a situation where a lot of publishers were not putting their stuff online, only in iPad apps or behind hard paywalls. So we had the idea to tackle those problems, making content easy to discover, and easily accessible.”
From that inspiration, Klöpping and Blankesteijn quickly devised the idea behind Blendle, which they have described as an “iTunes for the press” and a “radical experiment in micropayments for journalism”. It is a beautifully designed platform in which users can browse a digital equivalent of that real-world news stand, select articles of interest with small fees, from 20 cent to a euro per piece, deducted from their Blendle wallet. Crucially, to build trust and reward engagement, Blendle offers refunds if a reader is dissatisfied with an article. For titles with a paywall, it offers an opportunity to earn revenue from readers who would not otherwise sign up for a full subscription.
When Blendle launched in the Netherlands last year, there was a lot of interest and even more scepticism – the concept of micropayments goes back as far as Ted Nelson's famed Xanadu project, a theoretical precursor to the web that never really came to fruition, in which content creators would be awarded royalties via an inbuilt micropayments architecture. Attempts to implement such a system in early web browsers and the official worldwide web specifications foundered on the complexity of such a system. (Which is probably just as well – a key reason for the growth of the web was its chaotic free-ness, and any early payment mechanism would very likely have stifled its early development.)
Frictionless payment system
Since then, the concept of micropayments for journalism in particular has been often mooted but keeps coming up against the same challenges, such as making a frictionless payment system.
But Klöpping believes that Blendle has overcome many of those practical problems. "It's not so much about theory, it's about how you do the execution and what makes it work, because I've read the same pieces saying micropayments can never work, but the same thing was said about ITunes when everyone was downloading music on Napster. No one would expect that anyone would ever pay for music ever again, and then suddenly a lot of people were doing just that. It's not as much about the idea or concept of micropayments, in the end, it's about how does a user interact with a piece of software."
Blendle’s first 18 months in operation would suggest they have done a fine job of getting the software part of the conundrum right – with an initial Netherlands-only launch, they recently opened in the considerably larger German market, and have attracted more than 500,000 customers.
“What we now see in Holland, we see that there’s a very significant income for publishers, and they’re really happy with the income it’s generating,” he says. “It’s not possible to pay for all of the editors yet, but it’s definitely possible to pay for some right now. It’s additional revenue coming from a group who very often didn’t pay for journalism at all, so it’s an extra readership paying for content. So I think we’re on our way to proving the naysayers wrong.”
To that extent, Klöpping and Blankesteijn attracted a €3 million investment from the New York Times and German publishing giant Axel Springer last year, and Blendle has already signed up the NYT, the Wall Street Journal, the Economist and other quality titles for when it launches in the English-language market.
Klöpping acknowledges that is likely to be a stern test of Blendle. “The problem of filtering is even bigger in the English-language market, so I think it’s even more important for users to discover content that’s relevant for them. At the same time, we’re seeing that content get more and more paywalled, which is a trend with publishers. For readers, they’re never going to take subscriptions at all of these titles, so what we’re saying is you don’t need a subscription to these newspapers and you can just pay for the articles you do want to read.”
It is notoriously hard to make solid predictions about the nature of both online publishing and online financial platforms, so it’s doubly difficult to anticipate the success of a company that straddles both. But it’s clear that Blendle is doing an awful lot right so far.
“We are big believers in micropayments, if done well,” says Klöpping. “I think this can really work for more stuff, not only for pieces of text, but I think it can also work for video and other digital goods. It feels so logical, and we know that people are willing to pay if you make it easy enough.”
