What If Online Newspapers Charged Again?

By On May 7, 2009 · 15 Comments

Struggling newspaper budgets continue to reach for as many new ideas as possible. Today an old idea was echoed, once again, by NewsCorp’s Rupert Murdoch…

Rupert Murdoch announced that he plans to fix the current newspaper business model by charging for access to News Corporation’s newspaper web sites (via RWW)

This got me thinking and I posed this question on Twitter: “If all the newspapers in the country got together and made a pact to start charging for online content, what would happen?”

Newspapers should explore this question carefully. The closer they consider who would thrive in the absence of all their free online content, the clearer picture they will have of their future.

What Would They See in This Future?

What Say Twitter?

Twitter responses on what would result if all Newspapers begain charging for online content

 
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  • http://christopher-scott.com Christopher Scott

    I find it interesting that people keep assuming newspapers ALWAYS charged for news, and only recently stopped. Newspapers have never charged for their news. If you subscribed to a newspaper, most of that revenue went directly back to distribution and printing costs. Most of the time it was either a push, or the paper took it at a loss. The .25 cents or .50 cents at the newsstand was only to keep track of readership, and for all intents and purposes, never EVER supported the newspapers but to the tiniest extent. The real problem that newspapers are having, is that 90% of their revenue USED to come from advertisers who would pay almost any amount for print ads. The decline in THAT particular revenue has had the most compelling impact on the failing of newspapers than any other aspect. If newspapers DID start charging for content, to subsidize journalism (in effect) it would be an almost completely new model. Most people have never EVER paid for any news, ever… TV news is free, radio news is free, and news on the internet will always be free. If and when newspapers start charging people for the same thing they've been getting – essentially for free – I think they'll find that they'll be awful alone, and it could be the ultimate suicidal move.

  • http://intensedebate.com/people/jakrose jakrose

    Completely agree Scott \”it could be the ultimate suicidal move\”. I more or less was using that last line of yours as the assumption for this post. Since it would would more or less open up the playing field for new online media to be an even bigger piece of the news puzzle for people. That open playing field would result in the experimenting that is needed for newspapers to succeed online.

    Thanks for the historical preface though, it is important to consider.

  • http://www.equippedcreative.com Joel Newcomer

    I have dreamed up different pay models (such as selling credits that you use to read the articles you choose based on the writer, headline and first few sentences) that would make online news profitable and still a nominal expense to the reader…but what the problem really boils down to is not the COST of a subscription, but the inconvenience of having to log in AND not being able to easily share interesting content. I have been focusing my thoughts and efforts more on trying to come up with an idea that makes news site advertising more of a conversation so that advertisers see more results and readers find "advertising" to be more interesting and interactive…for example, instead of some annoying banner ad telling me that Joe's Automotive is the best value in town, why not have a photo of Joe, include some testimonials and share Joe's Twitter/Facebook/blog info so I can see what he is saying and what people are saying to/about him. I think that advertising as a whole is about to change just as our news sources are about to change…and anyone who refuses to change will find themselves left far behind.

  • http://observerinteractive.com Jason Silverstein

    There are a number of interesting branches of this debate, Jason, but they usually end up in the same place (imho) — local newspapers would lose market share and revenue if they tried to charge for content.

    First, let's add a little info to Christopher's good comment above. He's right, newspapers were free to start in almost every community. It was only when advertisers demanded that newspapers add a charge to the daily paper did the fee even begin! Advertisers wanted to make sure certain news organizations did not inflate their no. of copies and then, say, dump extras in the river. Keep in mind the print model is the higher the no. of readers, the higher the rates.

    He's also right about news being free MOSTLY. There are examples, such as the WSJ, that do a fantastic job of adding additional, medium-specific value that justify charging for content online. Many magazines still micro-focus and do very well in the news arena. The successful pay-for-media examples are generally very specific genres, locations, and/or experts. I can't think of any off hand that don't meet those criteria, but there may be a few. I think Christopher means the everyday breaking news of general value, but I'd let him address that part.

    So, back to the idea of free. I think it's a very bad idea to do an across-the-board paid plan on a no. of levels.

    The most important part of my position is that you immediately limit your audience and revenue potential.

    Let's start with readership. If you take your whole audience, a certain portion of it comes from Google and likely out of market. Those are not your core audience. Then you have print subs that also read online. You won't charge them. Then you have areas you won't charge to view, such as what's traditionally been called classifieds. Our parent company interactive VP also tells this story very well, so I'm not alone in this thinking.

    When you take the above into consideration, then you'll have a negative revenue difference between what you could get from subs vs. incremental value in retail display or targeted search. At our company for example, we are part of the Yahoo! Newspaper Consortium. This deal (disclaimer: I worked for Yahoo! for seven years) is one of the best opportunities the business has to move forward in a first-mover capacity in decades. The agreement includes use of Yahoo! technologies that allow our sales teams to work with advertisers to reach targeted behaviors, such as people looking for cars, in a way no other medium can do as efficiently.

    For bleeding edge thinkers, perhaps you think Yahoo! is a step behind? Google, our industry's golden child, is building a competitor as quickly as they can. The model for matching audience to behavior is that good.

    The above two positions are enough for me to want to stay the "free" course. And yeah, it's a different model… especially in the news business. But I came from a company comfortable in that model, and it's not black and white. It is possible to provide the kind of reporting a newspaper provides with multiple, different delivery models.

    That brings me to a quick, final note (at least on this long comment) — print is not dead. There are audiences for all medium types, and advertisers get tremendous brand and engagement with the paper (or they wouldn't be there!). People still buy books, magazines, CDs and other physical items like DVDs.

    There are a ton of very fun-to-work-on problems to solve technically before many of these mass-market items really dissolve to a niche audience, and that's one of the reasons why it's a crazy and exciting time to be alive and working in technology

    - Jason Silverstein
    Observer Interactive

  • http://cltblog.com Justin Ruckman

    The question of how to charge for their content is the least of their concern right now. Well maybe not *least*. But newspapers have to loosen up their minds and their approach to content, plain and simple. Join the information party that's going on right now instead of pretending they're the only ones in the room.

    It's like approaching a girl: if you don't give up your inhibitions and go for it, you'll never win anything. And you might fall flat on your face. But at least you tried, which is all anyone wants.

    Talking about how to charge right now is akin to asking the girl how she wants to split up the bills before you've successfully convinced her you're even worth dating.

  • http://intensedebate.com/people/jakrose jakrose

    Agreed, I don't think charging or figuring out new ways to charge for online content is the answer at all. I think you are right, new content directions are a big part of the answer. From iPhone to Kindle to TV, etc.

    Have you seen the Visit My Baltimore site mentioned in the post? It is not a journalism effort necessarily, but I think it is a good example of the types of experimenting Newspapers need to look toward.

  • http://my-creativeteam.com/blog Harry Hoover

    First off, if newspapers got together to agree to start charging for content, that would be collusion and they would be in violation of the law. Secondly, digital America is the land of the free. We are used to content being free and I don't think there is any going back.

  • http://intensedebate.com/people/jakrose jakrose

    Not really the point I was getting at Harry. I just think as a hypothetical, it would get Newspapers thinking in better directions. Take the pay for content model off the table, and what would replace it?

  • http://www.TheJungleMap.com Corey Creed

    Newspapers? What's a newspaper? I think my dad used to get one of those every now and then on a Sunday. Not sure.

  • http://oinnovate.blogspot.com Andria

    Hey Jason K. and friends,

    Excellent comments.

    Let's start with the idea that breaking news can't and shouldn't be hidden behind a pay wall. I'll bet the "hot news" doctrine of 1918 will get challenged in court shortly and will fail. http://bit.ly
    /Juirj Some news organizations will stake their brands on being first, and spend their resources to defend that, and some won't. We'll see whether being first can be a business model. I wonder how it's going for @BreakingNews.

    Then move on to civics: We're in a new era for civic and government online information, provided free, based on the concept of transparency and the idea that government information belongs to the taxpayers. News organizations have long been broadcasters and interpreters of that kind of information. If they hide that information behind a pay wall, they're abdicating a traditional social responsibility and giving up providing information that has been their bread and butter. Someone else will fill the void, for free, as a civic responsibility. See Sunlight Foundation.

    But some things are worth the money. Some quality, niche, found-nowhere-else content produced by news organizations could be worth paying for online: Jason S. is absolutely right that the successful pay-for-media examples are generally very specific genres, locations, or experts. Traditional news organizations in the past have had those experts, in words and visuals, but much of their best work that provides context to breaking news has remained hidden, inaccessible in archives. Curating and presenting that context in a visually pleasing way could be worth money in niche markets.

    In addition, Google's Marissa Mayer laid out some ideas to the Senate the other day on how to target and package articles for readers: Those idea could provide context-useful advertising that readers want, rather than hate. For example, I bought a $17.99 bottle of olive oil from Weaver Street Market in Chapel Hill recently, on sale for $7.99. It was opt-in advertising in Twitter, as I followed the co-op store's Twitter account. That's the future of advertising, useful. I'm guessing Google and others see that as well.
    Mayer's testimony: http://bit.ly/jGp0V

    Quoting Clay Shirky (as everyone is): Nothing will work, but everything might.

  • Crystal

    Andria quite wonderfully sums up what I was going to say. It's way too late for newspapers to start charging for online content. I don't pay for news online. I know somehow, somewhere that someone has that info for free.

    What's the answer on how to pay for reporters/editors & producers/copy editors/photographers/graphic designers? I have a few ideas. And I know some others who have some ideas. (And no, it's not the nonprofit route.)

    Those who want a new business model for the PRINT product focus on the real issue: the decrease in advertising and how to reinvigorate that revenue. Advertising is where the money is/was. Should broadsheet dailies change to tabs? Should papers start Sunday magazines?

  • http://intensedebate.com/people/cbates28210 Chris Bates

    I'm reading tomorrow's NYTimes tonight using TimesReader. It works for me. I can do this because I pay for a subscription to Sunday only paper delivery which is cheaper than paying for electronic only delivery. I have little buttons on my Blackberry that take me to free content (good enough is good enough) from Salon Magazine, The Atlanta Journal-Constitution, and the Washington Post..

    I check the Charlotte Observer on the Web at least several times a day in addition to sometimes picking up the subscription paper copy out of my driveway to smell the ever dwindling newsprint and hold on it as long as I can. Something is happening and I'm not sure how to pin it down. We are in the midst of a sea change that is happening whether we like it, love it or hate it.

  • http://intensedebate.com/people/cbates28210 Chris Bates

    Jason K. suggests that news providers do something collectively to lead rather than be trampled. I agree. But charging for content isn't the answer. Who will pay the freight? We will. How remains to be seen. In the short term I'd pay to see my local paper on my computer desktops, blackberry, etc. with the same strength and impact it used to have when it hit my driveway. Whether this is even possible remains to be seen as well. Glad to know that so many of us still care.

  • http://oinnovate.blogspot.com Andria

    Hey Jason K. and friends,

    Excellent comments.

    Let's start with the idea that breaking news can't and shouldn't be hidden behind a pay wall. I'll bet the "hot news" doctrine of 1918 will get challenged in court shortly and will fail. http://bit.ly
    /Juirj Some news organizations will stake their brands on being first, and spend their resources to defend that, and some won't. We'll see whether being first can be a business model. I wonder how it's going for @BreakingNews.

    Then move on to civics: We're in a new era for civic and government online information, provided free, based on the concept of transparency and the idea that government information belongs to the taxpayers. News organizations have long been broadcasters and interpreters of that kind of information. If they hide that information behind a pay wall, they're abdicating a traditional social responsibility and giving up providing information that has been their bread and butter. Someone else will fill the void, for free, as a civic responsibility. See Sunlight Foundation.

    But some things are worth the money. Some quality, niche, found-nowhere-else content produced by news organizations could be worth paying for online: Jason S. is absolutely right that the successful pay-for-media examples are generally very specific genres, locations, or experts. Traditional news organizations in the past have had those experts, in words and visuals, but much of their best work that provides context to breaking news has remained hidden, inaccessible in archives. Curating and presenting that context in a visually pleasing way could be worth money in niche markets.

    In addition, Google's Marissa Mayer laid out some ideas to the Senate the other day on how to target and package articles for readers: Those idea could provide context-useful advertising that readers want, rather than hate. For example, I bought a $17.99 bottle of olive oil from Weaver Street Market in Chapel Hill recently, on sale for $7.99. It was opt-in advertising in Twitter, as I followed the co-op store's Twitter account. That's the future of advertising, useful. I'm guessing Google and others see that as well.
    Mayer's testimony: http://bit.ly/jGp0V

    Quoting Clay Shirky (as everyone is): Nothing will work, but everything might.

  • http://webhead20.com Webhead20

    I agree that papers would still fold. Too many online news sources not paper companies. Here's what the NY Times is doing right now http://ow.ly/etSN