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Big Revolution - Choosing to pay

Welcome to today's Big Revolution. The long weekend in the UK is over and it's time to get some work
August 28 · Issue #184 · View online
Big Revolution
Welcome to today’s Big Revolution. The long weekend in the UK is over and it’s time to get some work done, wherever you are in the world. But first, grab a coffee and read today’s edition.

Big things you need to know today
  • Bloomberg has details on the next iPhones. It’s an ’S’ year, meaning no big changes, but an upgraded iPhone X is expected to be joined by a larger version, and also a cheaper version, meaning the ‘X’ design becomes the new iPhone standard. Apple is expected to announce the new handsets in a couple of weeks’ time. New iPads and a new Apple Watch are also reportedly on the slate.
The big thought
BuzzFeed News might let you pay for it... if you want to
Choosing to pay
There was quite a bit of snark in my Twitter feed yesterday, when Digiday reported that BuzzFeed News is quietly testing a memberships model. Those who are part of the test can opt to pay between $5 and $100 per month. They get nothing much extra for that, except a warm feeling that they’re helping fund original journalism.
No doubt, BuzzFeed saw The Guardian’s success with the same model and decided to give it a shot. BuzzFeed missed its revenue target last year, so needs to bring in extra cash.
But the difference between those two publications is that BuzzFeed has taken on nearly $500m in venture capital investment, so asking for donations seems a bit… off… to some.
Joshua Benton
I think BuzzFeed News is a wonderful thing and I want it to succeed. But I suspect a donation pitch will be hard for a for-profit company valued at $1.7 billion to pull off
11:10 PM - 27 Aug 2018
But why are donations a bad business model? Sure, they shouldn’t be the only source of revenue, but if people are willing to pay for a product out of choice because they find it valuable, that’s a great signal. Letting readers set their own price, effectively from $0 to $100, is a great way of understanding the perceived value of your product. It can help you price other products later on, too.
And if BuzzFeed ever wants to sell its News site on to another company, knowing what its readers will pay by choice is useful data as part of that process.
In the case of BuzzFeed News, don’t think of donations as charity support for a failing business. Instead they’re more a form of market research that makes money. In that light, it seems very smart indeed, and not at all snark-worthy.
And with that, I should say thank you to the Big Revolution readers who opt to pay $5 per month to help support this newsletter – you’re very smart too 😉
One big read
Y Combinator Learns Basic Income Is Not So Basic After All Y Combinator Learns Basic Income Is Not So Basic After All
An interesting look at how Y Combinator’s attempt to test universal basic income is coming along. It’s not gone as smoothly as they’d hoped, but it’s still making progress.
That’s all for today...
See you tomorrow for more Big Revolution. Please share this newsletter if you like it, and encourage people to subscribe via this link.
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