Paying for News
There has been a lot of talk lately from the old school newspapers about charging for news online. Saying they want to force people to pay for news as they read it.
Newspapers all over the country are struggling to find new revenue streams as the old dead tree based streams are drying up. The truth is that people don’t buy newspapers anymore. In fact, people don’t even read free newspapers anymore. More and more people read all of their news online. And that is hurting the newspaper industry that has been relying on subscriptions and print ads for it’s main revenue streams. If people aren’t buying your newspaper, that revenue stream is gone. And if people aren’t reading your newspaper (even if you give it away), then advertisers aren’t going to buy ads in your newspaper. And there goes the other main revenue stream.
On the online side, revenues are minuscule for most newspapers. Subscription based pay walls simply drive readers to other sites, and Internet ads don’t make up for the lost ads on the paper side. Competition for Internet ads is cutthroat and dominated by big giants like Google and Microsoft. And the traffic levels for many newspaper websites are even lower than their subscription list. So revenue from internet ads is often significantly lower than that of the paper edition. All of that adds up to a major crisis for the news industry.
So far the majority response of the newspaper industry is to claim they need to force the online users to pay subscription prices for access to the news content. The only way that is even remotely possible is if the ENTIRE industry switches to a subscription model. Because if even one newspaper or news source offers news online for free, then the whole model breaks down. And to be realistic, there is no way to ensure that all news sources abide by the agreement to charge for news. Even making it required by law (as some journalists have suggested) wouldn’t work in the online world. After all, laws can only be enforced within the geographical boundaries of the nation that implements them. And the Internet doesn’t follow geographical boundaries.
So the future of newspapers looks pretty bleak. No revenue from the old models, and the only new models they have come up with are simply impractical and doomed to fail. All in all, pretty bad.
That is until I read an article today in the opinion section of the Wall Street Journal. The best quote from the article that really sums up the entire point was the following.
“For years, publishers and editors have asked the wrong question: Will people pay to access my newspaper content on the Web? The right question is: What kind of journalism can my staff produce that is different and valuable enough that people will pay for it online?”
L. Gordon Crovitz
If you ask that question from the start, then all of the other problems go away. Because when you think about it, the problem with online revenues is a competition problem. Instead of competing with a few local newspapers for readers, you are competing with millions of newspapers all over the world. Most of whom are nearly identical to your newspaper. So there is no incentive for people to pay for access to your news over someone else’s news. And there is no particular reason for anyone to read your news website instead of one of your competitors news websites when it’s the same news.
But if your news is different in some way from that of your competitors, then they will read your website instead of other sites. And if your news provides some tangible benefit to the reader beyond simply keeping them informed, then they will be willing to do something to get it. With a tangible benefit you can charge a subscription for access, and people will pay it. And furthermore you can charge higher rates for your online ads because you can guarantee an audience that fits a specific mold.
This isn’t really a new concept. The problems facing newspapers today aren’t really any different than those any industry faces when it has a lot of competition. It’s just that most newspapers have gotten used to an environment where they didn’t really have to compete. And now that the Internet is forcing them to compete, they don’t seem to remember how.
February 24th, 2009 at 5:27 pm
The problem with that “right question” is that it will force journalists and reporters to produce what people want and not what people need.
February 24th, 2009 at 8:13 pm
And how would that be different from what they do now or have ever done in the past? Don’t buy the hype of “unbiased pure reporting”.
It doesn’t exist now and it has never existed. The newspaper industry has always reported on the stories and topics that their readers wanted to hear about. Because that was what sold papers.
February 25th, 2009 at 6:31 pm
i don’t buy into the hype of unbiased pure reporting, which is why i get my news from a variety of sources to get more than one point of view. but i do believe there are some who still strive to be more objective and less subjective. when i lived in a British Hong Kong, i thought the news was pretty objective. then i moved to the states and was struck by how much the “news” resembled talk and opinion shows.
but anyway, what i was saying about “what we want to hear” vs “what we need to hear” was not so much about bias, and more about subject matter.
February 25th, 2009 at 4:11 pm
“what people want” OR “what people need”…
1.) Can’t this be the same?
–> aren’t there people who can decide this very well for themselves?
2.) (even if not…) wouldn’t responsible journalism be a mixture of both?
I’m sure there ARE editorial staffs who do combine this. And some do it well.
February 25th, 2009 at 6:36 pm
1) yes it can, but in my humble opinion it often isn’t.
2) i agree. but i just think shifting to more of a salesman’s mentality would make it less so.
February 26th, 2009 at 7:11 am
@both Ben and Alexander
1. I totally agree. The majority of people don’t read news objectively or with any real comprehension. But we all have the ability and the need to do so no matter what the news atmosphere is.
2. I agree that responsible journalism is a mixture of both. Maybe I’m just a little more cynical and jaded than Ben is. I think that the responsible unbiased journalism, that we all hold as an ideal, has never existed. At least not in this country. It may have existed with individual journalists throughout the years, but those were the exception rather than the rule. When it comes to the news organizations(TV, Newspaper, Radio, Magazine), there have always been only two agendas. 1. To make money by selling your product(whether by selling your readers/listeners to the advertisers, or selling access to your news medium). 2. To further a particular religious or political faction.
February 26th, 2009 at 3:09 pm
By the way. Here is a good article on the issue.
http://techdirt.com/articles/20090225/0302243897.shtml
February 26th, 2009 at 8:34 pm
It’s a far stretch to say that “people aren’t buying newspapers anymore.” While the industry is certainly seeing some disconcerting declines in circulation (and subsequently the Audit Bureau of Circulations, the major ruling body of the industry, is finding itself more and more redundant) people still look to newspapers not only for news, but also for advertising. Where newspapers will benefit the most is focusing on local news since national news is freely available via CNN, Fox, etc.
That being said, I completely agree that getting people to pay for online content is futile at best.
February 27th, 2009 at 9:21 am
Of course there are still people buying Newspapers, but the numbers of people who buy them are smaller and smaller every year.
Just 10 years ago, nearly every household in my church and most people I knew subscribed to a Newspaper. Today almost no one I know or come in contact with buys newspapers. That isn’t to say they don’t read news, but they don’t buy the dead tree form of news anymore. They get it electronically on their phone or on their laptops.
This is a trend that is only going to get worse. So Newspapers that rely on people buying their paper copy of the news are going to be in serious trouble if they aren’t already.