Two views on paywalls

The most intuitive way to structure a paywall with respect to premium content — like, say, a longform reported magazine piece or a Snowfall-style multimedia feature — is to offer the cheaper content for free and put the premium stuff behind the gate. I say intuitive simply because it costs you more to produce that stuff; it makes sense, to the extent you’ve decided to charge at all, that you don’t give it away.

But recently I’ve been thinking about the argument for a simpler metered approach where all content counts equally, that came to mind thanks to this quote from Nate Silver (who wasn’t talking at all about paywalls). Here he is via Nieman Lab:

On balancing features and blogging-style analysis

We see them as two related, familial, but separate content silos. From a practical economic standpoint, one of the wonderful things about blogs, as they were originally invented, was you had relatively low transaction cost for producing a blog post. Not that it doesn’t have to be high quality — but you’re not necessarily spending as much of an editor’s time on it, you’re not going through multiple iterations. It’s more thinking about things in real time.
So in some ways, we want to, on our blog, get back more to what we think are the core differentiating values of blogging, and not this kind of in-between space a lot of news organizations have wound up in where everything became called a blog, and then it became unfashionable, so nothing gets called a blog.We do make a distinction based mostly on how quickly the content is turned out. What we call a feature is something where it’s assigned, generally in advance, and goes through at least one, maybe multiple rounds of edits.A blog is something which still has to be very good — and it’s as hard, relatively, to hire bloggers as it is to hire feature writers. It’s something that might get a quick read, and maybe has a little bit more voice, but also saying “this is my thinking in real time,” or my work in progress. How we’ll flesh that out exactly in practice, I’m not sure, but I feel like there is an important distinction to be made between the two.

This got me thinking about the awesomeness of truly good blogging, the way it makes you want to check in every 10 minutes to see if the author has something new to say. It’s why I still want to read everything Kevin Drum, Matt Yglesias, or Tyler Cowen writes.

Now here’s Silver on balancing between loyal readers and broader traffic:

I think with almost any web product you have two types of audience. You have your core, everyday readers and then you have the people you reach out to from time to time. I think that having the right content mix, where you can have big spikes in content by doing something interesting and different from time to time, but also making sure that people who are reading the site every day feel they’re getting a good healthy breakfast, lunch, and dinner everyday, full of FiveThirtyEight content.

All of which made me suddenly reconsider my intuition on paywalls and premium content. I hear Silver making the case for a metered model that treats everything equally. The high quality stuff can “travel” on social, reaching readers who otherwise wouldn’t stop by, and because they haven’t used up their content quota, they can view it for free. It’s essentially a loss leader that attempts to draw in more regular readers. And what those devotees are paying for isn’t high production value or in depth reporting so much as immediacy and consistency. They want to read all (or lots of) what you put out.

We see both models today: The New York Times and The Washington Post are metered; The New Yorker makes it harder to get to its premium magazine content than to its blogs. But when I think about my own willingness to pay (or lack thereof) the metered approach strikes me as a bit more plausible, because it pulls out all the stops to build an affinity to the brand. Put another way, you’re making it extra difficult to gain paying customers when you put your best products out of reach.

Average is Over, Robots, and the Minimum Income

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I recently read Tyler Cowen’s latest book Average is Over, and I’d recommend it to anyone thinking about technology and the future of the economy. It’s a highly readable vision of what the coming age of ubiquitous intelligent machines will mean for workers and the economy. Here’s a bit from Chapter 1 that captures Cowen’s thinking:

Workers more and more will come to be classified into two categories. The key questions will be: Are you good at working with intelligent machines or not? Are your skills a complement to the skills of the computer, or is the computer doing better without you? … If you and your skills are a complement to the computer, your wage and labor market prospects are likely to be cheery. If your skills do not complement the computer, you may want to address that mismatch. Ever more people are starting to fall on one side of the divide or the other. That’s why average is over.

To be clear: the book is not about whether this is a good or bad thing, or whether its results will be positive or negative. But his articulation of what the world will look like is bleak:

We will move from a society based on the pretense that everyone is given an okay standard of living to a society in which people are expected to fend for themselves much more than they do now. I imagine a world where, say, 10 to 15 percent of the citizenry is extremely wealthy and has fantastically comfortable and stimulating lives, the equivalent of current-day millionaires albeit with better health care.

Much of the rest of the country will have stagnant or maybe even falling wages in dollar terms, but a lot more opportunities for cheap fun and also cheap education. Many of these people will live quite well, and those will be the people who have the discipline to benefit from all the free or near-free services modern technology has made available. Others will fall by the wayside.

(You can read more about what Cowen thinks this will do to U.S. politics in this excerpt at Politico.)

If we accept for the moment that Cowen’s vision of how machine intelligence will transform the economy is basically right, how might we avoid this sad state of political and distributional affairs?

Enter the minimum income. As The New York Times recently explained:

Every month, every Swiss person would receive a check from the government, no matter how rich or poor, how hardworking or lazy, how old or young. Poverty would disappear. Economists, needless to say, are sharply divided on what would reappear in its place — and whether such a basic-income scheme might have some appeal for other, less socialist countries too.

(You can read Cowen on some of the shortcomings here.)

I see a few reasons why a guaranteed minimum income would fit nicely with the future Cowen describes.

1. Supplement the incomes of those unable to compete in the labor force. This is obvious. But the guaranteed minimum income strikes me as a way to maintain the notion of a guaranteed standard of living for all. Moreover, as intelligent machines put pressure on the labor market, tying that standard to work — as we do through the minimum wage — may make less sense.

2. Incentives to work would matter less than they do today. As the Times notes, one of the biggest concerns around a minimum income is that it would serve as a disincentive to work. But that should matter much less in the world Cowen envisions, where unskilled labor is largely displaced by machines. In that world, the fact that some citizens opt not to work would matter less to GDP. Moreover, it would be unlikely to impact the motivations of higher skilled workers, who would set out to earn far more than the guaranteed income provides.* This logic applies both to citizens working despite the option of a guaranteed minimum income and to the disincentive of higher marginal tax rates on the wealthy to support such a program. Don’t buy this? It would be even more true given #3.

3. Increased cultural emphasis on self-motivation will already be necessary. The world Cowen describes prizes self-motivation above almost everything else. If you’re motivated, you’ll take advantage of cheap education to work your way into the most productive echelons of the labor market. In such a world, a cultural focus on increasing self-motivation would be extremely helpful. Moreover, such a cultural emphasis would serve to bolster my arguments in #2, undercutting the argument that a guaranteed minimum income disincentivizes work. In other words, we would accept that financial incentives to avoid work existed, but overcome them in part by becoming a society obsessed with promoting curiosity-based learning and a quest for mastery or “flow.”

4. Some slack in the economy will be necessary to promote art and entrepreneurship. In this hyper-efficient, ultra-competitive world, the creation of a strong safety net would arguably be even more necessary to promote things like entrepreneurship and the arts. Entrepreneurship is mentioned as an argument for the guaranteed minimum income in the Times piece and I think it is a strong argument in two senses. First, a stronger safety net helps to de-risk entrepreneurship; if you forgo a higher income to found a startup and then fail, you’ll at least fall back on some level of comfort. Second, a minimum income would help to subsidize entrepreneurs’ incubation period, as already happens through “entrepreneur-in-residence” programs. If entrepreneurs can eat and live somewhat comfortably while working on their idea (but before it is at the point of making revenue or being attractive to investors), they’ll be more likely to take the plunge.

As for the arts, the tight labor market envisioned in Cowen’s book would put even more negative pressure on the wages of artists. Huge swaths of those without the skills to succeed in complementing machines would seek to become musicians, actors, painters, etc. bidding down wages for those industries. A minimum income would make it possible for artists to do their work.

For all these reasons, I see a guaranteed minimum income as a natural fit with the world Cowen describes. To be clear, I’m not saying I think we’ll necessarily get that world, or that a minimum income is actually a good idea. But as we ponder a world of machine intelligence and a bifurcated labor market, it’s something to at least consider.

Image via Wikipedia

*Even today, I would argue that the most productive workers are largely not motivated by money. Rather, they’re motivated by status, curiosity, and a sense of mastery. To the extent that money is a motivator, it’s largely as a substitute for status.

Don’t gamify healthcare — gamify health

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There was a piece in Fortune earlier this month with which I strongly disagreed, on the subject of healthcare, technology, and “gamification”. The post centers around a health tech hackathon and, I think, in dismissing the promise of gamification, misses one of the most promising aspects of health IT. Here’s the gist:

Several months ago, I sat in on a case competition at Boston University’s School of Management. The event played out over two days, during which 15 teams of five students from B-schools all over the world — India, South Korea, Canada, but mostly the U.S. — pitched their ideas for a company, one that would revolutionize health care (the stated goal was particularly jargon filled: “to leverage information technology to transform global health care and create value”)…

Immediately, a theme emerged, and the theme was games. “How do we gamify health care?”… As the day wore on, one of the Merck representatives finally asked, in exasperation, “Why would you make a game out of taking a pill? This will never be fun,” which is true…

I happen to think this is a bit needlessly cynical with respect to drug adherence, but the point I want to make is different. The term “health IT” tends to conjure the thought of medical records and the efficiency of medicine more broadly. But one of the most promising areas in my mind, specifically with mobile technology, is in gamifying health.

If you look at what’s driving U.S. healthcare costs, a huge chunk is driven by diseases directly caused by poor health behaviors like smoking, overeating, and lack of exercise. As I put it in a post a little over a year ago:

Want to crack healthcare costs? Help at-risk individuals smoke less, drink less, exercise more and eat better.

This is where the potential for gamification lies. (If you don’t like the buzzword, call it behavior modification.) Think of it like this: using a doctor to treat the fact that you eat too much and don’t get enough exercise is a terribly inefficient health plan. You go in every few months, the doctor scolds you for not sticking to your diet and exercise regimen, you go home and don’t change.

The opportunity is to leverage the fact that we now all carry powerful computers connected to the internet with us at all times (in the form of smartphones) to nudge us toward better behavior. This is by no means easy! And for now it’s way worse than the alternative of relying on a mix of social support from family and friends along with willpower and attempts to form better habits. But is it out of the question to think that mobile technology can supplement those things?

Think about RunKeeper, the running app, or GymPact, the workout commitment app, in this context. They’re both, basically, turning fitness into a kind of game, and they’re both using different motivational levers to try and increase your likelihood of exercising. This kind of thing — the good behavior layer — is where the potential for gamification lies. Not in making it more fun to take your pills or to receive a medical diagnosis.

The area that excites me in terms of health technology isn’t revolutionizing medicine, as big a deal as that may be, but revolutionizing health.