Blendle, a Dutch startup that’s applying a Netflix style marketplace to journalism, has signed up the mainstay of German publishers to its pay-per-article market. It said today that all major newspapers and magazines in the country have announced they will start selling individual stories via its website. The list includes Bild, Die Welt, National, Der Spiegel, Die Zeit to name a few.
Blendle launched its service in April 2014 in the Netherlands and now has more than 300,000 registered users, up from 130,000 last October. On the publishers side, it has signed up a total of 18 daily newspapers and 15 weeklies from 14 publishing houses — with two operational markets (Holland and Germany), and English-speaking media in the U.S. next on its hit-list.
The Blendle marketplace works by taking micro-payments from readers to access individual articles. The exact per article cost is set by publishers, while users top up their accounts with a set amount of their own choosing (such as 10 or 20 euros) and can then spend it as they please — reading articles from whichever publications and publishers they fancy. The site also allows readers to get refunds if they think an article didn’t merit the 20 euro cents (on average) they paid for it.
The startup raised a $3.8 million Series A funding round last fall, from the digital investment arm of European publishing giant Axel Springer, and the New York Times Company. Axel Springer publishes several of the German titles Blendle has just signed up, of course, underlining the strategic value of choosing the right investor. Back in March Blendle also signed up the New York Times, Wall Street Journal and Washington Post — albeit at the time only pushing that U.S. content to its sole operational market, the Netherlands.
Blendle’s model has not yet been tested in an English media market but that will be next on the cards if it pushes ahead with a U.S. launch. In English markets it is inevitably competing with greater quantities of free online content, so it will be interesting to see how well it fares.
Asked how it sees its model performing in the U.S., co-founder Alexander Klöpping argues that continued use of paywalls by publishers will support a marketplace approach as a lower friction alternative to allow readers to gain access to quality content.
“More and more content from publishers goes behind hard paywalls (WSJ, FT, Time Magazine, etc.) or metered paywalls. Blendle works as an EZpass for journalism, with all publishers that join. And we’ll only join if we have the majority of publishers on board,” he tells TechCrunch.
“Discovery is also a part of it. Maybe like Apple News, Blendle recommends stories. We use a combination of algorithms and humans: we hire editors that help users find articles out of all the newspapers and magazines. The combination of the two: easy payment for premium content and discovery, works very well for us. And we think it can be great for the U.S. market.”
“For publishers, we think micropayments can be an additional revenue stream next to ads. And a funnel towards more subscriptions (users will be able to take subscriptions with one click via Blendle for unlimited reading from one particular title),” he adds.
The rate of article refunds on Blendle has, perhaps unsurprisingly, crept up slightly. When I spoke to the startup last October Klöpping said it was around 3 per cent. It’s now pegged at a general average of 5 per cent, although certain types of media evidently attract more refund requests than others — with what Blendle terms “gossip magazines” seeing a higher percentage of refunds than “quality newspapers”. It’s not saying how much higher.
This is perhaps the most interesting aspect of Blendle: its marketplace model could end up shaping content — and if it’s penalizing clickbait and promoting “quality” reportage it could offer a substantial answer to the ‘race to the bottom’ ad-supported media content model that currently predominates in many markets. (It’s also interesting the startup employs human editors to help with content discovery.)
“Our system encourages people to write better articles instead of clickbait,” Blendle argues. “The Internet only functions as a clickbait generator: as soon as you’re doing clickbait, you get more clicks. People are not getting happier, but you do get more clicks. Ours is basically the only system where you get punished for clickbait because people refuse to pay for it. In that way, we encourage quality journalism.”