On Readability’s Business Model

by jscariati

There’s an episode of Curb Your Enthusiasm in which Larry writes a TV script that somehow ends up getting into the hands of his lawyer. Unbeknownst to him, she voluntarily reads the script, records her own notes and suggestions on how to improve it – and then demands that he pay her for her time. Larry, of course, refuses, on the grounds that he shouldn’t have to compensate her for doing something that he never asked of her in the first place.

This is how I feel about Readability and their now-defunct publisher payment plan. In short, Readability is a free service that lets you save articles from the web for later reading in a clean and distraction-free layout. As a means of, presumably, “giving back” to the authors whose articles were saved by Readability users, they also introduced a payment model: users would pay a fee to Readability, and Readability would then distribute the money to the original publishers.

It sounds like a win-win: Readability provides a service users want, users pay for the service, and Readability takes that money and gives it back to the publishers whose content is what makes their service attractive in the first place.

The problem is that, in reality, the system didn’t work. Because publishers had to opt in in order to receive payment from Readability, it created a situation much like Larry found himself in: Readability was collecting money on behalf of publishers who had never explicitly authorized them to do any such thing. And even publishers who were aware of this couldn’t actually collect “their” money unless they signed up and agreed to Readability’s terms.

The system was flawed from the perspective of users, as well – users were paying the fee on the premise that their money would go toward the publishers whose articles they were saving, whereas that was really only the case if the publishers had also agreed to participate.

Readability now admits that the publisher payment plan didn’t work because too few publishers opted in, and has therefore decided to donate the unclaimed money to charity. But that’s a bit like if Larry were to donate the equivalent of his lawyer’s fee to a charity instead – it doesn’t change the fact that she shouldn’t have demanded the fee in the first place.

To me, a business model of collecting money on someone else’s behalf – without their authorization and potentially even without their knowledge – seems to cause more problems than it solves.