I call your attention to seven recent pieces about the business of news. I don’t feel strongly enough (or have enough new to say) about any of them to comment at length, but I’ll comment briefly.
Dean Starkman of Columbia Journalism Review continues to pretend that paywalls are a panacea for the news business, saying that the Washington Post needs one immediately. Let’s assume for the sake of argument that I’m wrong and paywalls are a good idea. At best, they’re only part of a solution. If they were the path to posterity, the news organizations with paywalls wouldn’t be struggling the way they are. Even if a paywall works, we need a lot more than paywalls, and the single-minded focus on paywalls is slowing the development of other solutions.
Mathew Ingram’s response to Starkman is, not surprisingly, much more insightful: “This focus on a paywall as a magic solution misses the point about the larger risks facing both the Post and the industry as a whole.”
While we’re on paywalls, David Brauchli, spokesman for paywall vendor Piano Media and brother of former Post editor Marcus Brauchli, makes the case for paywalls, faulting academics for telling students and colleagues how to avoid paying to read newspapers’ online content.
He repeats a favorite lie/myth of the paywall crowd: “Starting 1996, all the news that was fit to print was given away for free using a business model that was wholly advertising-supported.” Here’s the fact: Newspapers, and almost no one else, have been trying to make paywalls work for the entire life of the World Wide Web. Paywalls haven’t caught on because no one tried them. They haven’t caught on because they haven’t worked. Maybe they will eventually, but if that’s the case, it will be because of their persistence, not because they finally saw the light.
Cary Spivak looks at the motive of the new newspaper owners who have invested in newspapers lately, based on interviews with some of the owners and public statements by others. It’s not a paywall piece, but notes that paywalls are popular with the new owners. And it repeats another common BS theme of the paywall crowd, quoting George Norcross III, one of the new owners of the Philadelphia Media Network:
“I’m in the insurance business,” Norcross says. “If I gave insurance away for free, I doubt I’d be in business very long.”
The news business is not the insurance business. Television stations are in their seventh decade of giving away news, and they are doing better than newspapers. That’s because TV stations and newspapers were never in the content business. They were in the advertising business. When newspapers were thriving, we were essentially giving our content away, charging less than the cost of production and distribution. The advertising business has been disrupted and we need to develop new revenue streams to support news. But comparisons of news to insurance are just silly.
Speaking of TV stations, Andrew Beaujon reports about an Allbritton Communications station in Harrisburg, Pa., is going to share content with the Carlisle Sentinel to compete with the Harrisburg Patriot-News when the Advance newspaper cuts back its print edition to three days a week in January. I have a little experience with Allbritton’s level of commitment to local news. Will be interesting to see how patient they are with this partnership.
Rick Edmonds and Alan Mutter comment on the newspaper industry’s 25th straight quarter of declining year-over-year revenues. Mutter’s graphic showing the sharp decline of newspapers’ print ad revenues, the swift growth of total online advertising and the paltry growth of newspapers’ online ad revenues is appropriately titled “Sobering trend.” He rightly notes that newspaper companies have been weak at generating revenue from mobile and search, the biggest sources of digital advertising growth.
One final piece that on the surface has nothing to do with the business side of newspapers: John Robinson notes the past week’s rush from cliché story to cliché story, from Thanksgiving to black Friday to the usual stories we do when a Powerball jackpot reaches record levels. Maybe that piece appears to be about journalism rather than business. But if you’re going to charge for content in a marketplace where most content is free, you’d better be providing more value than cliché stories.
If Norcross ran his insurance business like a newspaper, the policies would be on paper half-covered by advertising, and everyone’s premiums would be a lot lower. I don’t think he would find that a good idea.
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Hey Steve, More than 300 newspapers in the US have erected pay-walls and it’s spreading to Canada. In Europe, three countries use national payment systems to generate subscription revenue. Pay-walls may not have worked in the 1990s and early 2000s, but they are working now and more publishers will continue to adopt them until there’s a better business strategy out there for monetizing content. Thanks for the article.
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David, I don’t presume to know what would work in Europe. And I agree with you that more publishers will continue to adopt them, but let’s not pretend that extensive use by publishers means that a strategy is working. If paywalls were working, we would hear about some cases where they were working. But the New York Times, the situation most often cited as a success, continues to struggle. The Wall Street Journal is another favorite example cited by paywall advocates, but it actually shows why paywalls won’t work for most newspapers. The Journal has high-value, unique content that most newspapers can’t come anywhere close to matching, and, perhaps most important, a huge percentage of the Journal’s customers pass on their subscription cost to their employers or clients or write it off on their taxes as a business expense. If paywalls were working for a metro or community newspaper, I don’t think they’d keep it a secret. Paywalls may be working for Press+ and Piano Media, but news sites need to develop more and better revenue streams (and most of them will work better without paywalls to reduce the audience).
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“Paywalls haven’t caught on because no one tried them.” might be clearer to state “Paywalls haven’t caught on NOT because no one tried them.”
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[…] The “bottled water” argument doesn’t apply to newspapers. “Television stations are in their seventh decade of giving away news, and they are doing better than newspapers,” Digital First Media macher Steve Buttry writes. […]
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[…] Lots of views on paywalls, digital ads and the business of news […]
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[…] attempt at paywalls, a post on the ridiculous notion that whether paywalls work has been settled, a roundup of paywall commentary, a piece about the New York Times’ paywall and a piece debunking the notion that paywalls […]
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