From Google Will Have It’s Own Online Payment System

Posted: June 22, 2010 in Uncategorized

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Newspass will compete with Journalism On-line’s Press+

A system that will allow publishers to charge small amounts for access to on-line content appears to be gaining speed at Google Inc., reports last week indicated. The system, called Newspass, will roll out before the end of the year, said the Italian newspaper La Repubblica on Thursday.

The Newspass system as described by La Repubblica is similar to an process described by Google last fall in a proposal made to the Newspaper Association of America and released by the Harvard journalism program NiemanLab.

“Later this year, Google will launch an integrated payment system that will allow users to buy [news content] with one click and publishers to use a single infrastructure for Web, mobile and tablet to monetize their content,” a New York Times translation of the La Repubblica article said.

Both the Times and asked the Mountain View, Calif.-based Google to respond to the Italian newspaper report. For both the company neither denied nor confirmed the article.

“We’ve consistently said we’re talking with news publishers about ways we can work together, including whether we can help them with technology to power any subscription services they may be thinking of building,” a Google spokesman told the Times. “Our aim, as with all Google products, is to reach as broad a global audience as possible. We have nothing specific to announce at this time.”

The Newspass system from Google would undoubtedly compete with the Press+ system that has been developed by Journalism On-line LLC, the startup that received a boost earlier this month with an investment from News Corp.

Both systems would provide readers with a log-on that would allow them access to a variety of digital media. The Newspass and Press+ systems would aggregate the accesses to various media throughout a month and present the reader with a combined monthly bill which would theoretically be paid off with a credit or debit card.

What prevents publishers or web site operators from doing this on their own are the high “merchant fees” credit card companies levy against companies that accept credit cards. The merchant fees can range from one-half of one percent of the total transaction up to as much as five percent of the transaction, with additional charges such as a transaction fee, a batch processing fee and an interchange fee.

By using a service such as Newspass or Press+, the publisher leverages the larger size of those companies, which would then reduce the fees. Google has a leg up on JOL here in that it already has its Google Checkout payment system.

In other paid content news, Bloomberg News reported last week that The Times of London is offering a variety of incentives to get readers to pay for on-line content, including free tickets to the movie “Toy Story 3” or a free weekend at a fancy boutique hotel two hours outside of London.

The Times and other News Corp. London web sites began implementing a paid-content model last week.

“We don’t expect or require that all the people who do now will still look at it,” said Daniel Finkelstein, executive editor of The Times, told Bloomberg. The paper’s on-line fee will be £2 ($US2.89) a week. “What’s left is still a vast market.”

In other on-line news news, the John S. and James L. Knight Foundation said on Thursday that it was expanding its neighborhood news project with three inter-related grants that total almost a half-million dollars.

The Miami-based foundation said it had provided grants to OpenPlans Inc. of New York City, Missouri’s Columbia Tribune and the Boston Globe. OpenPlans, a non-profit software firm, will receive $235,000 to streamline and extend code that was developed with a $1 million Knight grant in 2007-2009 for the project, while the two papers will get grants of about $100,000 each to implement the code on their web sites.

So, it looks like web site publishers will either get in bed with Google or with Murdoch (via JOL). That will be a tough choice for many.

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