Undernews is the online report of the Progressive Review, edited by Sam Smith, who covered Washington during all or part of one quarter of America's presidencies and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

August 5, 2009


Sam Smith, Progressive Review - It looks like more than a few large media will start charging for online visits. From the Business Spectator in Australia:

[][] Media giant News Corporation Ltd intends to charge for all its news websites in a bid to lift revenues. . . News Corp chairman Rupert Murdoch told analysts in a conference call after News Corp released its full year results that the traditional newspaper business model has to change. "The digital revolution has opened many new and inexpensive methods of distribution," Mr Murdoch said. "But it has not made content free. Accordingly we intend to charge for all our news websites," he said. He said News Corp would use the Wall Street Journal's online vehicle as a model. [][]

And from the Digital Journal:

[][] In a speech in London, Financial Times editor Lionel Barber said that within the next 12 months, news agencies will be charging access to their websites. The only thing that will be discussed, according to the editor, is whether they should charge per month or per article or possibly even both. "I confidently predict that within the next 12 months, almost all news organizations will be charging for content." This speech comes the same week after Digital Journal reported that the CEO of ask.com said that the “era of online content is coming to an end." The New York Times is also planning a subscription-based model that would charge users $5 per month to gain access to its online content. Currently, the discussion between the two models, pay-per-article and per-month subscription, is to decide which is more cost effective and revenue based. Pay-per-article would mean that you would pay for every article you read, very similar to the $0.99 songs on iTunes. The other model is to charge users per week or per month. For example, $1.99 per week, or the New York Times' plan on charging $5 per month. [][]

It sounds good, but life moves on and print media will never be what it once was. Even the Washington Post admitted recently that it "is now largely an education company -- its Kaplan Inc. education unit provided 58 percent of the parent company's second-quarter revenue, as opposed to the newspaper division, which chipped in 15 percent. "

The model for the planned shift - the Wall Street Journal - isn't doing all that well either. Reports Australia's Age: "Dow Jones & Company's fourth quarter operating results declined from the same period a year ago, due to lower advertising revenue at The Wall Street Journal and lower information services revenue that more than offset reduced operating expenses and
increased circulation revenues, which were driven by price increases at The Wall Street Journal."

So what will happen if major newspapers switch to a subscription or pay per view basis? It's speculative but here are some reasonable guesses:

-- Some of the papers will do well, but probably based on further cutbacks in operating costs; others will simply find it yet another false trail. Even if they do financially better, they will become culturally less important.

-- It will be a blessing for radio and television which will stand out as free sources of hard news. CNN and MSNBC could be big beneficiaries.

-- Public radio and television will get a big boost. Hell, I might even start watching the Jim Lehrer Hour.

-- TV and radio internet sites will also become more important.

-- The already large role of non-profits in investigative reporting will greatly increase. Many papers, including the Washington Post and NY Times, have effectively turned over some of their investigative reporting role to non-profits, although they won't admit it. When a non-profit discovers something wrong in America and these papers feature it, they're saving themselves a lot of money over what it would cost if their staff had to come up with the story. Look for non-profit journalism on the web to grow substantially.

-- Smaller online journals will be helped by the biggies demanding bucks for their web content. For example, one can imagine a site like Politico growing rapidly.

-- Regional media with free online sites may find it worthwhile to throw in more national coverage, such as in a field that particularly affects their local readers. This would bring readers who otherwise wouldn't be interested. And there may be a revival of Washington coverage by local media. It sounds strange today, but one of the capital's most famous journalists wrote a Washington column for almost fifty years, covered World War II and was second in appearances on Meet the Press, only behind David Broder. May Craig's employer was a family owned chain of Maine newspapers including the Portland Press Herald.

-- Most exciting would be if - after the biggies went under paid cover - there was an explosion of an online alternative press not unlike what happened in print in the 1960s, which saw a few such publications expand to over 400 and helped to change America's politics forever. Unnoted is the role that technology played in the growth of the 1960s alternative media: the introduction of offset printing left many papers with expensive machines lying idle much the week. One solution: cheap printing for others including the underground press. This journal, for example, could get 10,000 copies printed by a conventional weekly paper with a new printing press for around $400.

Technology is the often underrated partner of change. For example, some believe that the civil rights movement was aided significantly by the spread of air conditioning in the south, which permitted that region to move into a more modern urban culture.

But with each change in technology, there are the stuffies who just don't get it. The ones who resisted the change from horses to cars, sail to steam, and talk to hard type. They see themselves as granted a permanent place in society. Which is why today's publishers prattle on about the quality of their journalism that made them so great. In fact, it wasn't so much the quality as the scarcity of their journalism that made them successful. Once journalism, with the Internet, became available to the many and not just an elite, the whole game changed.

History suggests that those who resist technological change have a hard time catching up. It is, after all, a whole new culture and one you can think - but not buy - yourself into. So I wish the stuffies the best of luck with their attempt to turn the Internet into the same old thing it has long replaced, but I suspect that what they'll really be doing is leaving more free space where others can grow.


Blogger m said...

Media management doesn't seem to understand the problem. I can't think of any corporate media outlet that I would pay to read. It is rare that it is even worth time.

August 6, 2009 7:42 AM  
Anonymous Anonymous said...

I suspect the real issue here is one of supply and demand! if it is sort after content and you have it exclusively you have something to sell! if you don't you don't! now packaging a selection is another value adding service that media groups attempt.! the thing is that the public have moved on from hard news it is no longer that important and therefore that is the real challenge for the establishment as you seem to see them. Just because the incompetence of the recorded industry saw billions of dollars of lost sales and a explosion in free down loads it does not follow that music should be free and I for one don't want to have all my content polluted with advertising, that would be selling out to the establishment! If I want advertising content it has a value and is as valuable as the primary content or it devalues the experience!

August 6, 2009 1:43 PM  
Anonymous Ediie Mix said...

wow, this is bad news for all the people reading the news now...soon blogs will officially take over..

August 6, 2009 4:35 PM  
Blogger Samson said...

Its a lie when they act like they've been giving it away for free. Look at any of these websites, and they are covered with ads. The corporations of course charge for the ads, touting the number of visits to the websites to advertisers.

They are just trying to wring more money out of the suckers who still believe them. The words they use to try to sell this is just more bs from the masters of bs. They know of course that their readers will object to having even more money removed from their wallets, so they try to cover this money-grab by rhetoric that tries to pretend they can't give this away for free when they've been making money from it all along.

August 6, 2009 5:52 PM  
Anonymous Axel in Montreal said...

For sure, I'm not going to pay. They'll just lose me to the bloggers - and CBC radio, which already provides me with the conventional sort of news.

Funny remark about air conditioning being a force for progress in the South. I didn't know that the great urban centres of culture, such as Hellenistic Alexandria, had had air conditioning! But I do know that when I visited New Orleans circa 1980 I overheard African-Americans, several times, exclaim how they hated air conditioning in the stores.

August 7, 2009 6:40 PM  

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