Content or Community? A Digital Business Strategy for Content Providers in the Social Age1
Abstract
The content industry has been undergoing a tremendous transformation in the last two decades. We focus in this paper on recent changes in the form of social computing. Although the content industry has implemented social computing to a large extent, it has done so from a techno-centric approach in which social features are viewed as complementary rather than integral to content. This approach does not capitalize on users’ social behavior in the website and does not answer the content industry’s need to elicit payment from consumers. We suggest that both of these objectives can be achieved by acknowledging the fusion between content and community, making the social experience central to the content website’s digital business strategy. We use data from Last.fm, a site offering both music consumption and online community features. The basic use of Last.fm is free, and premium services are provided for a fixed monthly subscription fee. Although the premium services on Last.fm are aimed primarily at improving the content consumption experience, we find that willingness to pay for premium services is strongly associated with the level of community participation of the user. Drawing from the literature on levels of participation in online communities, we show that consumers’ willingness to pay increases as they climb the so-called “ladder of participation” on the website. Moreover, we find that willingness to pay is more strongly linked to community participation than to the volume…
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Metrics are one way to measure value on social media, but not the sole resource.
“Although social media metrics are one of the references for measuring value, they are not the only resource (Oestreicher-Singer and Zalmanson, 2013).”
From ‘Traffic rewards’, ‘algorithmic visibility’, and ‘advertiser satisfaction’: How Chinese short-video platforms cultivate creators in stages (2024) · cites this paper as Oestreicher-Singer and Zalmanson, 2013
Contemporary social media channels allow the formation of smaller communities and viewing audiences in a way traditional media channels such as broadcast television have not.
“Contemporary social media channels, which video streaming services are also an extension of, allow the formation of smaller communities and viewing audiences (Marwick, 2015; Oestreicher-Singer and Zalmanson, 2013) in a way that traditional media channels such as broadcast television have not been able to provide to the same extent.”
From Social motivations of live-streaming viewer engagement on Twitch (2018) · cites this paper as Oestreicher-Singer and Zalmanson, 2013
The timing of the first conversion trigger (the point at which free-tier limitations become salient to users) is positively associated with conversion rate when it occurs after users have achieved a threshold level of product-integrated workflow dependency, but negatively associated with conversion rate when it occurs before that threshold.
“The timing of the first conversion trigger (the point at which free-tier limitations become salient to users) is positively associated with conversion rate when it occurs after users have achieved a threshold level of product-integrated workflow dependency, but negatively associated with conversion rate when it occurs before that threshold.”
From Scaling a SaaS Business: The Role of Freemium Models in Converting Free Users to Paying Customers (2026) · cites this paper as Oestreicher-Singer and Zalmanson (2013)
Accounts that adopted the team workspace exhibited a NRR of 142 percent, compared to 114 percent for accounts that did not.
“accounts that adopted the team workspace exhibited a NRR of 142 percent, compared to 114 percent for accounts that did not.”
From Scaling a SaaS Business: The Role of Freemium Models in Converting Free Users to Paying Customers (2026) · cites this paper as Oestreicher-Singer and Zalmanson's (2013)
Customers who have climbed the ladder from free to paid continue climbing, progressively deepening their engagement and expanding their investment.
“customers who have climbed the ladder from free to paid continue climbing, progressively deepening their engagement and expanding their investment”
From Scaling a SaaS Business: The Role of Freemium Models in Converting Free Users to Paying Customers (2026) · cites this paper as Oestreicher-Singer and Zalmanson's (2013)
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“…literature on consumer decision making in the freemium context (Bapna & Umyarov, 2015; Hamari et al., 2017; Koch & Benlian, 2017; Nan et al., 2018; Oestreicher-Singer & Zalmanson, 2013; Vock et al., 2013; Wagner et al., 2014) and post-adoption user behavior in online services (egKim & Son, 2009,…”
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Scaling a SaaS Business: The Role of Freemium Models in Converting Free Users to Paying Customers
Kessler, N., & Gallagher, P. W. (2026) · American Impact Review · doi:10.66308/air.e2026022
- Authors
- Oestreicher-Singer, G., & Zalmanson, L.
- Affiliations
- Tel Aviv University (IL)
- Venue
- MIS Quarterly
- Publisher
- MIS Quarterly
- Published
- 2013-06-01
- Volume
- 37
- Issue
- 2
- Pages
- 591-616
- ISSN
- 0276-7783 (ISSN-L)
- 2162-9730
- OpenAlex
- W3122080363
- Cited by
- 422
- References
- 5
- Citations by year
- 2026: 18 · 2025: 27 · 2024: 29 · 2023: 35 · 2022: 44 · 2021: 45 · 2020: 39 · 2019: 31 · 2018: 29 · 2017: 36 · 2016: 34 · 2015: 27 · 2014: 22 · 2013: 5
- FWCI
- 86.97
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- MIS Quarterly (publishedVersion)
- Topics
- Social Sciences › Business, Management and Accounting › Strategy and Management › Digital Platforms and Economics
- Social Sciences › Sociology and Political Science › Digital Marketing and Social Media
- Social Sciences › Business, Management and Accounting › Marketing › Copyright and Intellectual Property
- Keywords
- digital business strategy, content industry, social computing, online communities, willingness to pay, freemium model, subscription services, Last.fm, ladder of participation, community participation, content consumption, digital content delivery, self-selection bias, subscription decision
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