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Journalism, media, trends

Charging for online content in the US – the Google question and an alternative model

As many UK newspapers continue to slim down as print version sections are ditched in exchange for online-only content, the noise around charging for online content by newspapers is amplifying. The owner of philly.com (the 180 year-0ld Philadelphia Inquirer’s online home) and Daily News is the latest – in the US at least –  to say he is considering making readers pay for web-based news.

image found at http://www.renaissanceconnection.org

myfoxphilly.com, in an interview with owner Brian Tierney, reported the title is “struggling for survival” and has filed for bankruptcy, owing $300 million to investors. The site is owned by the FOX broadcasting network.

Meanwhile, the Guardian’s Bobbie Johnson reported that the New York Times was also condering charging for online content after points from a strategy meeting were published live on Twitter by Jennifer 8 Lee, a  reporter at the newspaper.

The Washington Post and the New York Times have been talking to Google about capitalising on content. Om Malik writer and founder of tech blog Giga Om is scathing about this model”. . . Many blame the likes of Google for their woes. Yet [the Washington Post] is talking to Google in an effort to figure out new ways to make money. . . Instead of coming up with a smart strategy . . . they’re going to Google to help fix their own mess. If an industry can’t think for itself, well, what do you call it? How about dumb, fat and lazy? ” he says.

An anecdote from the NYT’s head of digital media Martin Nisenholtz about typing ‘Gaza’ into Google and finding Wikipedia and Twitter beat the paper’s result ranking summarises the situation well. So on the one hand papers are bemoaning Google for ruining their print sales and the other they are having business meetings with them. This is a much-reported issue and one US ex-journo Danny Sullivan writes compellingly on . He points out that all papers would have to do if the really thought Google was inflicting so much damage, would be to insert this simple piece of code:

User-agent: *
Disallow: /

and they would no longer appear in searches. This is part of his vitriolic rant in response to Rupert Murdoch who said  in a Forbes article Google is stealing his copyright.

Well, papers better find an alternative source of income and quickly, as advertising sales plummet as people increasingly go online to read the news. I’ve found this graph of advertising sales in the US on the TechCrunch site, but nothing for the UK.  For anyone who can’t see it, it shows a very downwardly sloping line. You get the picture.

Who do titles have to learn from for cocking up before they do? (they might look to the NYT’s Times Select furore which began to charge for content, then changed its mind). Publications can clearly only speculate on what the public will do as there as no precedent has been set. A survey (‘Moving into multiple business models’) on the future of newspapers in the digital age from PricewaterhouseCoopers (PwC) found print newspapers and web content are likely to co-exist longer term and revenues from traditional media would dominate “for some time.”

The report, conducted in seven countries, also forecast the global newspaper market will decline by 10.2% this year, then by 2% annually until 2013. Unsurprisingly, consumers were not prepared to pay as much for online content as for a traditional newspaper.

What’s the worst-case-scenario outcome of all this – a world without newspapers? It’s been well documented in the press about the demise of local papers and Mark Potts, a US ex-journo media consultant tackles the question in his blog post ‘What happens in a city when its newspaper dies?’ He the point many editors make that only local papers can provide cover local news. He argues:

The point is that the question of who covers local news and information in a newspaper-less city is a moot point. The replacements already are serving the audience the paper used to have to itself, and there are more in the wings. . . there’s no doubt in my mind that new business models will emerge to support local news and information. And . . .some of the people who run these upstarts sites aren’t even in it for the money. That’s a very interesting turn of events, and especially tough for big-iron, expensive legacy media to compete with.”

I wonder if printed papers were to die, local or national, models such as the Czech Republic’s PPF Group finance and investment group would follow, whereby “connected cafes” were launched in several cities to try to link journalists physically and digitally with their readers. This month this café-cum-newsroom model is set to become a reality when the Group tests the format (which also aims to appeal to advertisers and their diminishing budgets with “the promise of speaking to clearly identifiable target demographics,” according to US research company PSFK).

I’ll leave the last word to the PwC folk from the report I mentioned earlier, because they’ve done a lot more research on this subject than I have. “Newspapers have a long-term future and will coexist with other media. However this is unlikely to be either in the formats or volumes seen today and there will some casualties and losses of well-known papers along the way.”

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Discussion

One thought on “Charging for online content in the US – the Google question and an alternative model

  1. A report on the state of the media in the US is here, conducted by Pew Research Center’s Project for Excellence in Journalism, a nonpolitical, nonpartisan research institute.

    Posted by melpoluck | July 30, 2009, 12:04

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