Paid content seen complementing online ads

By Robert MacMillan

NEW YORK (Reuters) - Do we make them pay or do we give it away? That question has bedeviled media executives ever since they discovered they need an online business plan.

The answer so far: A little bit of both.

Media companies will offer most of their content for free on the Web and rely on advertising revenue, but they will not stop charging for some content until they better determine what people want, executives said at the Reuters Global Technology, Media and Telecoms Summit this week.

"It depends a little on the nature of the content," said Viacom Inc. (VIA.N: Quote, Profile, Research, Stock Buzz) Chief Executive Philippe Dauman.

"There will be premium products where people will be willing to pay," he said. "But we're big believers in brand and advertising."

Trying to figure out what business model makes the most sense on the Internet can get complicated.

Advertising is attractive because companies can better measure its success rate online than in print or television, and Internet ad sales are growing as businesses try to reach potential customers who spend more time online. But ad sales growth could trickle depending on larger economic patterns.

Companies also must consider the sometimes quixotic habits of Internet audiences whose tastes and responses can change as rapidly as communications technology advances.  Continued...