Eight Slovenian Media To Start Charging For Some Online News

Eight big Slovenian publishers are about to start charging for parts of their online content all at the same time, using a single payment kiosk that was pioneered in Slovakia and could soon be expanding elsewhere.

The Piano system will let customers pay €4.90 per month (or €1.99 per week, or €48.90 per year) to access to the gamut of competing sites, which are eight newspapers, two magazines and one pure-play news site.

The scheme begins fully on February 20, following soft introduction of an access wall minus fees on January 20. Piano hopes to sign up one percent of Slovenia’s 1.3 million internet population.

Publisher participants include Slovenia’s largest news house, Delo, which will require Piano membership for 10 to 15 percent of its content including exclusive stories, interviews, opinions and features.

“Like many other print media worldwide, we are simply forced into this. The reason is economics,” writes Delo’s digital development deputy Marko Crnkovič on Delo.si, explaining that web advertising prices have dwindled and readers ignore them regardless.

“Today, there is instant, free access to information on every corner. It is expected that most people are willing to pay for quality and exclusive information, especially for value-added journalism.”

Like in Slovakia, publishers are not requiring payment for all content. Delo will publish two versions of its articles. To non-subscribers, the proportion of articles inside the pay quota will remain a “nevertheless complete, self-sufficient, meaningful whole”, Crnkovič promises, saying premium versions will merely include extra bells and whistles.

Still, Crnkovič adds “Piano is just the first phase of the monetisation of digital content”. Later in 2012, Delo will add a further payment option that more closely resembles the New York Times’ metre and will allow tablet access.

Hold-outs from the scheme include the Finance.si business daily, the Pop TV broadcaster, the Telecom ISP’s news portal, and public TV and radio.

On May 2, 2011, nine major Slovakian news and magazine publishers plugged parts of their sites in to Piano. Piano claimed to hit its subscription target within two days.

Despite claiming it took €40,000 in its first month, it is not clear exactly how many subscribers Piano has in Slovakia. The company claims success in what is a small population and a small internet market.

Seventy percent of subscription revenue goes back to publishers, balanced according to audience. Piano’s Slovenian fees are costlier than in Slovakia.

“Unlike in Slovakia, in Slovenia we teamed up with a consultancy that specialises in pricing and did extensive research with most of the publishers to see how readers feel about the pricing of our product,” Piano CEO Tomas Bella explains to paidContent.

“The price of €4.90 came out as the optimal figure. Of course, we already have better knowledge about how price-sensitive people are based on our experience from Slovakia.”

“Slovenia is similar to Slovakia in a way. There is no huge player of the size of News Corp or NYT that would feel either that it has already solved the paid content problem or that it can easily throw in millions of euros to try to solve it.

“We picked Slovenia for very pragmatic reasons. Publishers there were among the first that showed a lot of interest right after our launch in Slovakia. We were also lucky because we found and hired a very capable country manager quickly – he’s been working for Piano full time since June 2011.

“We are not going to focus on countries of this size in future, all the rest in pipeline are bigger. Also, we will probably not have as many publishers participating in other countries as we do in Slovakia and Slovenia because the more mature markets are usually more concentrated (not so fragmented as Slovakia and Slovenia). So, in most of the other markets, three to six participating publishers should be sufficient for Piano to work well.”

In September, Piano took €300,000 in first round funding from local VC Monogram Ventures to try international expansion.

Bella also now tells paidContent: “We are in the process of raising a series B investment that would cover costs to start up in several dozen countries in the next few years. However, we generate enough revenue that we can launch a few more countries in 2012 without a second round of investment.”

We first wrote about the startup in November 2010.