I hope the newspaper tycoons meeting secretly in Chicago this week come up with a clap-your-hands plan.
Because clapping our hands to save the newspaper industry, like we saved Tinkerbell at the movies when we were children, has more chance of succeeding than the paid-content-cartel approach that newspaper executives are dreaming and talking about but being careful not to conspire about.
I know nothing firsthand about this week’s secret meeting in Chicago, organized by the Newspaper Association of America, but I refer you to reports and analysis by Slate, Nieman Lab, Scott Rosenberg and The Atlantic. I’m sure I know some of the executives huddled to discuss how to charge for content (without discussing so specifically that they would be colluding illegally). I have done business with many of their companies and honor their organizations’ contributions to journalism. I wish them and their companies well. And I am thoroughly, profoundly disappointed that they are wasting so much attention and energy on an approach that is doomed to failure.
This meeting is an embarrassment. Our industry fights for openness and accountability in government and we are trying to find a path for success in a digital marketplace where transparency is increasingly important. Can these people not see how foolish and hypocritical it looks to think they can huddle behind closed doors and solve our problems?
Knowing that I will be repeating myself, I offer seven reasons that newspaper companies need to stop looking to the past (paid content) to find solutions for the future:
- Even if the Justice Department were to look the other way, newspaper collusion still wouldn’t work. The quality of newspaper sites’ content has declined as they have cut their news staffs. In the meantime, free community news sites have sprung up like wildflowers: the St. Louis Beacon, MinnPost, Voice of San Diego, West Seattle Blog, Eastern Iowa News, The Batavian and Huffington Post Chicago and national sites such as Huffington Post, ProPublica and Politico, many of them subsidized by the buyouts that newspapers have given to experienced journalists. Watch their traffic and advertising soar if their arrogant competition erects paid moats around their news sites. (One start-up local site, INDenver Times, did try to support itself with subscriptions and reached 6 percent of its goal.)
- Traffic and advertising revenue will fall faster than subscription revenue will rise if news sites start charging for their content. Martin Langeveld has already done the math on that.
- Micropayments won’t work either. My Gazette colleague Jamie Kelly has done the math on what newspaper stories are worth in print.
- Quoting myself here (from remarks at a panel discussion at Iowa State last month): “Newspaper circulation peaked in 1993, the year Larry Page and Sergey Brin turned 20 and five years before they founded Google. So let’s not blame digital competition for upheaval in the newspaper business. We were killing each other off and failing to innovate long before competitors started figuring out the secrets of success in the digital marketplace.”
- Charging for online content won’t protect the print edition much either. The Arkansas Democrat-Gazette, which took that approach, has been cutting its staff just like the rest of us. Mark Potts wrote on his blog about a debate with Publisher Walter E. Hussman on that approach.
- Paid content has been tried before. One of the biggest myths of the newspaper business today was that we foolishly gave our content away early in the age of the Internet. Many newspapers were either slow to go online because of fear of cannibalization or erected pay walls. We finally got aggressive and free online because holding back our content and charging for it weren’t working.
- The energy, money and time we waste pursuing solutions that can’t work keep us from spending energy, money and time pursuing forward-looking solutions. Maybe my Blueprint for the Complete Community Connection isn’t the solution, but it has lots of ideas we should try. Or try Steve Outing’s membership approach. Pursue Dan Conover’s vision for 2020 media. Refine the non-profit approach that several are trying. Or come up with your own plan. But base it in something more solid than resentment, wishful thinking and nostalgia.
For more of my thoughts on this, read Take 2 on newspaper executives’ secret meeting.
For more reading on paid content, I recommend:
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- Guide to local watchdog news sites (cyberjournalist.net)
- Non-For-Profit Isn’t A Business Model For Newspapers (paidcontent.org)
Two more reasons subscription sites won’t work:
8. Even if readers were willing to pay for content, registration is too much of a hassle to attract all but the most dedicated. Have you ever gone to a free newspaper site and left after it asked you to register? Me too.
9. Copyright law allows excerpts of up to 250 words, and summaries of any length. So if the Washington Post web site started charging, I could buy one subscription, start my own web site, populate it with nothing but excerpted Post content and sell ads undercutting the Post’s rates – stealing both circulation and advertising revenue.
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Keep in mind that no one has ever been willing to pay much for news. Subscription revenue and street sales have never amounted to more than a fraction of newspapers’ revenue. If no one has ever been willing to pay enough for news to support a news organization, why should anyone imagine that people will suddenly be willing to do so now? And for a much-attenuated product.
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[…] UPDATE: Recommended reading – Steve Buttry on “Seven reasons charging for content won’t work” […]
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I **love** your line about springing up like wildflowers. Thank you.
Our circumstances FWIW were a little odd – we left a long and prosperous “old media” career BEFORE the Grim Reaper was seen hanging around the front door – I voluntarily quit my seemingly secure and well-paying gig at a Tribune-owned TV station here in Seattle in December 2007, to take a chance on making our site a business supported solely by advertiser revenue. Within half a year, we were the first Seattle-area online-only neighborhood-news site to become financially self-sustaining. With ZERO supplementation — no other jobs, no drawn-upon savings, no VC (HA!!!), no grants, no other source — our display ads (and that’s what they are, pure display, we don’t sell clickthru or conversion) generate the money that supports my husband, me, our 13-year-old son, AND an increasing amount of money we pay out to freelance reporters/photographers, as we get closer to being able to hiring actual official employees.
To your original topic, it’s a nice fantasy, but forget it. Even if you have diehard customers/fans, they just don’t feel like they should pony up. We tried a “pledge day” a few months before getting our business license and starting ad sales. While we were thankful to bring in almost $2,000 – which enabled us to buy a video camera and fund the aforementioned business licenses! – that was contributed by a grand total of about 60 people, out of the several thousand who visited the site at least once a day at the time. Somebody that day actually said, look, just go sell some ads and shut up about asking us for money, k? We took their advice.
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Thanks so much for sharing your perspective, Tracy. I applaud your entrepreneurship and your contribution to the search for a healthy future for journalism. This was a much-needed boost, received as I was responding to a critical email from a friend who does not agree at all with this post.
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@Steve,
I couldn’t agree more with you on this statement in particular: “This meeting is an embarrassment. Our industry fights for openness and accountability in government and we are trying to find a path for success in a digital marketplace where transparency is increasingly important. Can these people not see how foolish and hypocritical it looks to think they can huddle behind closed doors and solve our problems?”
This meeting makes us all look like hypocrites. That’s exactly what journalists and news orgs need to avoid right now.
I added some thoughts of my own on charging on my blog. Charging for anything on the Web needs to be done carefully and thoughtfully.
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I can’t help but believe some just get confused completely when there are significant figures in the industries who legitimately entertain the potential for charging for content. To your point, I agree – http://c3it.wordpress.com/2009/05/08/murdoch-myopic/
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All of you, please stop making sense. There’s no place for that sort of thing in this industry. kthxbai.
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After the conference I attended on Wednesday, it’s clear to me that (pardon the cliche) the paid-content train has left the station. It’s going to happen. They’re actually going to do this thing, and no amount of reasoned argument or empirical evidence is going to change that.
This is going to suck up millions of dollars, it’s not going to make them more money, and it’s going to cost them cash (in terms of web traffic) they can’t afford to lose. It’ going to hasten the end.
At this point, that’s the bright side. Maybe they just need to go away.
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Steve, you’ve put the case well. And the previous commenters noting the closed doors mafia approach of the major newspaper publishers is spot on. It’s time for new models, new approaches, and a realization they brought the situation on themselves. Everything happens in cycles.
The cycle that’s allowed newspapers to maintain sustainable businesses for decades has finally curved down. And as you rightly point out, there’s no point blaming digital media. If the internet hadn’t arrived (perish the thought) conditions and drivers would still have changed the playing field.
It’s interesting seeing the newspapers struggling to adapt to modern times the same as the music industry – who’ve of course taken an aggressive and litigious route, mistakenly thinking they can stop the world changing. They’ve been proven wrong, and newspapers will as well.
Cheers….David
http://www.NicheContentMillionaire.com
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