Thursday, April 19, 2012

{JMC 335} Refelctions

Funding Journalism, a book that we're reading in JMC 335 which deals with how to create financially stable media in the digital age, makes the suggestion that media should consider price discrimination.

In price discrimination, a company would charge consumers more or less depending on the demand in each consumers' market area. For example, in 2000 it was discovered that was allegedly charging returning customers more than new customers for DVDs. Amazon denied the allegations, saying that they were testing consumer behavior and that the price changes had no correlation to customers' past buying habits.

Whether or not Amazon took part in price discrimination does not change the fact that this practice is alive and well in today's market. I've seen many instances where photographers, for example, will charge twice as much to shoot a wedding than they would to shoot a similar event such as a quinceanera or large birthday party.

I understand why this practice might be put in place. It's all about making the money. But I don't think it's a always a particularly ethical practice. Charging people more because they are desperate for your product or services generally doesn't seem like the humane thing to do.

At the same time, the types of price discrimination proposed in Funding Journalism includes practices like releasing news for a fee when it first breaks, but then releasing it for free (supported by ads) after a time. This would be similar to what TV networks do with shows--release them on the network, which customers have to pay for by getting cable, then releasing them on for-a-fee sites like Amazon and iTunes usually 24 hours or so after the show airs, and finally releasing them via free sites like Hulu or their own network sites usually around a week after the show first airs.

This type of price discrimination bothers me a lot less because it doesn't seem that it's taking advantage of someone's situation or need in order to make more money. It's simply offering premium services at a premium price.


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