By Mark Whittaker

SAN FRANCISCO — A panel discussion about free vs. paid content turned raucous at the OMMA Global conference here Wednesday when one panelist questioned whether sites like HuffingtonPost.com and PopSugar.com provide quality content like that produced in large newspapers.

David Moore, chairman and founder of 24/7 Real Media, said advertising alone will not pay for the creation of good content. “Good content costs,” Moore said, adding that declining advertising rates only increase the pressure to charge subscriptions.

When Brian Sugar, CEO and publisher of Sugar Inc., disagreed, Moore said “What you do is not premium content.” It was no surprise when Sugar bristled along with Greg Coleman, president and chief revenue officer for the Huffington Post. Sugar, whose company produces lifestyle and entertainment sites such as PopSugar.com and FabSugar.com, shot back that he would be sure to pass that along to his company’s 50 paid editors around the world.

Coleman also said that Huffington Post intended to survive without subscription revenue.

And to add fuel to the fire, Moore said “I would be astounded if HuffPo ever makes money!”

On the other hand, Sugar and Coleman both gleefully encouraged legacy news companies to erect pay walls. They figure they’ll gain readers who abandon sites that charge.

Laura Martin, managing director and senior analyst: entertainment, cable, media for Needham & Co., and Merrill Brown, senior strategist for Press+ (Journalism Online LLC), also sat on the panel moderated by Andre Heyward, senior advisor for Marketspace LLC. Brown’s company is encouraging newspapers to build subscription models and develop products that will be bought by online newspapers’ most loyal readers.

The panel debate illustrated the deep differences between those who believe legacy media companies should charge for online content and those who believe online readers are too used to free content to pay for news.

Despite that, however, there was agreement on some basic premises. First, publishers who simply try to repurpose print content for new devices (such as the new iPad from Apple) are doomed to failure. Second, some content is already commoditized — sports scores, stock prices, national government news — and readers will definitely not pay for that.

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