Using CyberCash's new CyberCoin system, which allows people to make purchases of 25 cents to $10 over the Net, anyone who visits ESPNet's free area can view proprietary content such as RealAudio broadcasts of NBA games or sortable sports statistics by paying around $1 for a single day, the company announced today.
A growing number of online services are finding success through a combined ad and fee-based revenue model. But analysts warn that micropayment systems like CyberCoin could undermine that model if consumers are forced to pay a small amount for content that used to be free.
Playboy, which also is teaming up with CyberCash, seems confident that occasional visitors will pay a small fee to see content that could normally cost $6.95 a month, $18 per quarter, or $60 a year. Playboy will pilot CyberCash's micropayment system about six months after the relaunch of Playboy's Cyber Club, a company spokesman said today. That fee-based service is targeted to go up in late March or early April. Cyber Club shut down soon after its launch last November because its servers couldn't handle the influx of traffic.
Details of the CyberCash deal aren't finalized, but Playboy plans to let nonsubscribers buy a "day pass" for access to "never-before-seen" content such as articles and unpublished photos. The site will charge a small fee for entrance into celebrity chat sessions.
"We offer pretty unique types of content that somebody may want to go in and just read an exclusive interview or see the millions of photos in our archive. A lot of those photos will eventually be available online," Rebecca Theim, Playboy's spokeswoman, said today.
"There are people who are in there every day, but that is a different audience; we want to take care of both audiences," she added.
ESPNet agrees. The company's subscribers pay $4.95 per month or $39.95 yearly for unlimited access to such features. CyberCash's system allows consumers to buy services or products on the Net through an Internet Wallet, which draws funds form their existing back account.
ESPNet's move today has been called "safe" and "smart" because it lets nonsubscribers get a peek at special material, which could lead to more full-time subscriptions for the service.
"For ESPN, there is minimum risk involved because they're not charging for anything new that was free," said Dan Amdur, Internet analyst for the Yankee Group. "The issue overall is deciding what exactly you want to charge consumers for, and being careful not to cannibalize ad revenue."