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Consumers Balk at Paying for Specialized On-Line Services

By® Staff

Originally Posted

Pay-for-play is a tough Internet market to crack, particular for consumer services.

Two-thirds of U.S. consumers would not pay for any services on the Internet, including enhanced email, instant messaging, or file-sharing capabilities, according to a new study from Internet analysis and measurement company Jupiter Media Metrix. Consumers are slightly less resistant to paying for content (63 percent negative) than to paying for on-line services (69 percent).

"There is no obvious killer-application on-line service that consumers would pay for," says David Card, Jupiter Research vice president and senior analyst.

"Companies should bundle on-line services and price them at less than 30 dollars per year. [Unless they have a top-notch, specialized on-line application like our Contacts On Tap™ media database!] When transitioning from free to fee, service aggregators must solicit early consumer feedback and promote packages with email aggressively."

About one-third of on-line adults in the United States use a free service for their primary personal email account; more than 60 percent use an ISP. Only 12 percent would be willing to pay for enhanced email, according to Jupiter. Only eight percent of adults would pay to access on-line recruitment and job sites; six percent would pay for enhanced instant messaging and file-sharing capabilities.

"With high consumer resistance in the air," Card says, "companies that want to profit from on-line services should consider a menu approach, offering several courses or choices. To date, no portal or ISP has experimented with it. Those that do will have a jump start on the market."

Business-to-business products, like The Wall Street Journal and the CornerBarPR.comSM Contacts On Tap media database, seem to be exceptions.

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