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Readability Gives Up on Being Legit

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“Read later” services like Readability and Instapaper are changing the way we read content online. By stripping away the goofy web formatting that can often screw up your reading experience even on the nicest of Android (GOOG) or iOS (AAPL) devices, these services simplify the look of an article by just displaying the text and photos, often without ads. Even better, you can read whatever you save even if when disconnected from the Internet.

But what about the publishers? Don’t they get screwed out of revenue with this model? Don’t worry, Readability’s got their backs (unlike the other guys). By offering a voluntary subscription fee, Readability’s users can happily enjoy all the wonderful content they consume by knowing that a full 70% of their dough is going directly to the writers and publishers they love so much to read.

So all is fine and dandy in the world, another giant problem solved, and we can now move safely onto the next thing, right?

Not so fast. There is one little issue with this model, reports Buzzfeed -- it doesn’t work at all and Readability is abandoning the whole damn thing.

Readability CEO Richard Ziade attempted to explain their decision by recently posting an explanation for why they’re shutting down the service, revealing that they are sitting on nearly $150,000 in unclaimed royalties. That means that over 90% of of the funds set aside for publishers has not been distributed to the content creators.  

If you’re paying for the service, you may think that Readability just takes the money and hands it over to who they re-published the content from. Publishers are probably under the same assumption. But they would both be wrong, because, as Ziade points out, collecting the money is the publisher’s job. It’s up to them to find out about this service then go and register with Readability and then claim their checks.

It didn’t work. Out of the millions of domains that flowed through the service, Ziade says only about 2,000 registered.

And as services like Readability grow in popularity, it’s not a stretch to imagine someday where there’s literally thousands of such apps and sites, republishing content at will. If the publisher is expected to register for each one, to make sure they can grab their $8 owed by this one site, and the $90 by another, it will only continue to not work.

So it’s over and done with, and we’re back to searching for better ways that keep readers happy and publishers paid.  

But there is one winner in all this. Whatever loot remains unclaimed after July 15 will be given to the charities of Readability’s choice, which they say will be the ones “that speak to the spirit of supporting reading and writing.”

In other words, not publishers.
POSITION:  No positions in stocks mentioned.