Search engine giant Google is developing a technology that will help newspapers in charging money from online readers.
In a proposal to the Newspaper Association of America, Google said it is working on a software that would help newspapers to charge money from ‘micro-payment’, a payment vehicle which would be available both to Google and non-Google properties within the next year.
“While we believe that advertising will likely remain the same source of revenue for most news content, a paid model can serve as an importance source of additional revenue. In addition, a successful paid content model can enhance advertising opportunities, rather than replace them,” the company said.
It said in a statement that it will mitigate the risk of non-payment by assigning credit limits based on past purchasing behaviour and having credit card instruments on file for those with higher credit limits and using proprietary risk engines to track abuse or fraud.
Google would also allow readers to utilise single sign-on capability to access content and manage subscriptions, while publishers would be able to combine subscriptions from different titles together for one price.
At present, there are only two newspapers ---Financial Times and The Wall Street Journal that charge readers for content, although both offer some free news content to readers.
The search engine site said that paid content model has two main challenges. First, the content must offer value to users. Only content creators can address this. The second is to create a simple payment model that is painless for users.
However, Newspaper Association of America has asked the companies to provide information on how to generate income from online contents.