
Why Are iPhone Users Willing to Pay for Content? - robg
http://bits.blogs.nytimes.com/2009/02/26/why-are-iphone-users-willing-to-pay-for-content/?ref=technology
======
potatolicious
Because everyone is actually willing to pay for content, if the price is
right, and it is sufficiently easier than the free alternative.

Case in point: TV shows. You can either click _a single button_ and download
the TV show from _really fast servers_ , be notified of new episodes (and even
auto-download) automatically...

or you can go to a shady torrent site with porn popups all over the place,
install a torrent client (and set it up, which behind a NAT is non-trivial for
most laymen), find a good torrent search engine, download your torrent, and
curse your machine because public trackers are full of leechers who don't
upload.

Yeah, I'd pay for the former too.

~~~
Xichekolas
Exactly. Where are my $2 episodes that I can download legally?

A decently popular cable show probably has around 2 million weekly viewers.
Make it super easy to get the episodes in 720p for $2, and that is $4 million
a week in revenue, or $80 million for a 20 episode season (plus merch and dvd
collections afterwards). I'm not sure what a season of a given cable show
costs to make, but I'd be surprised if it was $80 million.

From the consumer's perspective, we are used to paying $60-100/mo for cable.
If episodes cost $2 and we watched four a month, that is $8 per show per
month. Our normal $60-100 would buy us 7-12 shows, which I imagine is more
than most people follow anyway.

Same could be true for sporting events. I'd gladly pay $4-5 to watch streaming
high def games. The company would make a killing off me in March, but I'd
still pay it because it's worth it to me to not have to buy a whole cable
package just to watch one month of basketball.

~~~
menloparkbum
_Where are my $2 episodes that I can download legally?_

I can't tell if this is a rhetorical question. Most shows I want to watch cost
$1.99 at the iTunes store...

~~~
Xichekolas
They are $2.99 for HD, and they are DRM'd.

> _Purchases you make from the iTunes Store can be played on up to five
> computers that you authorize using your iTunes Store account name and
> password._

Although, yeah, they are close!

~~~
aardvarkious
But does the DRM really get in the way of how most people watch shows (ie:
once)?

------
Flemlord
Easy access. Reasonably priced. Instant gratification.

~~~
jrockway
Well said. This is why I'm OK buying DRM-encumbered ebooks from Amazon. It
Just Works, and I get a lot out of the experience.

------
chenelson
Simplicity: Each purchase represents a discrete function users require in a
package that doesn't have a steep learning curve.

Value: Customers are leveraging the wisdom of crowds (aka popularity) to help
them choose an application (aka functionality) via Apple's App Store.

Barrier to Entry: The implementation promotion game includes the developer
application process and cost, and the price point of the application.

Not-Quite-Open Platform: at&t and international cellular providers' customers
aren't limited by enterprise inefficiencies or by the device manufacturers;
customers can upgrade their iPhone with ease.

Leveraging Free Software: Apple is leveraging a customized version of BSD with
a GUI brand/standard optimized for a single device (assuming cellular data
technology is just a feature) instead of a product line.

Operational Excellence: Apple is easing into the mobile market instead of
throwing a bunch of devices at customers and seeing what sticks; that's
expensive.

Good Luck and The Global Economy: The iPhone was an investment during good
times; customers are saving money and not looking to upgrade right now.

Ecosystem: Customers are building systems that compete with the established
software companies and service providers in each vertical by blending mobility
with simplicity. Oh, and the Apple iPhone experience is good with the PC... it
is better with a Mac.

------
lsb
They're willing to pay more for a better experience; that's why they bought
the iPhone.

Apple made their side of the buying process really wonderful, and the content
providers did the same, and the buyers have had generally positive reactions
so far.

------
AndrewWarner
I'd pay for convenience, but most pay sites ask for my money PLUS they reduce
convenience.

For more free content, I can just click and get it. But when I want paid
content, I have to fill out a form + get out my credit card + create a
password.

The iPhone cuts out most of that work.

------
rrival
Tangible virtual goods.

It's something I can hold in my hand. It instantly crosses the barrier from
"that's something I've seen on the internet" to "that's something I can show
you in my hand right now" without having any duplication cost. All kinds of
win.

------
smidwap
iPhone owners tend to be better off, at least in my experience, than the
average web surfer. Not a big surprise here that they would spend more money.
Still, Apple had to create this success, it wasn't thrown at them.

------
zmimon
People who bought the iPhone have already bought into the notion that paying a
premium you into a tier of exclusively higher quality experience. Paying for
content once you have the iPhone is just an extension of, and in fact, a way
of reconfirming and validating the decision to pay all that money for the
iPhone to begin with.

It will be interesting to see if as time goes by the quality of iPhone apps
decreases and tarnishes the expectations of quality or not. For now i think
the gloss of quality from the iPhone carries over into an expectation about
the apps themselves, so people are not nearly as wary of iPhone apps as say, I
am about all the random shareware floating around in the PC market in the same
price range.

------
yesimahuman
For me, it's that I forget how many I've already bought and the developers and
apple have done a sufficiently good job at making the "lite" versions seem
uncool. Kind of like being the kid in school that always has the second hand
stuff. People want to pay for the real thing.

------
kenver
One way of getting stuff that I've wanted for a while is to be able to pay for
a series up front + maybe a bit extra, download it as they come out, then at
the end of the series get the dvd/blueray box set.

