The recent announcements that the New York Times along with News Corp. publication Times UK will put their online content behind a pay wall comes as no surprise. Most newspapers and publications are bleeding money and are having difficulty reconciling advert revenue with print, distribution and content costs. The Times UK is reported to be losing £240 000 per day, and shedding online visitors while the NYT is gaining viewers but still not making money. But will putting all their content inside a ‘walled garden’ help or hinder? The answer seems obvious – it’s a losing proposition. It’s like watching your teenager sneak out for a tattoo – you know they will regret it later in life, but they have to learn through their own mistakes.
We are all part of a massive paradigm shift in communications; both witnesses to, and factors in, the ‘great experiment’. A decade ago Google began to redefine search – and to index all the information and content available within the World Wide Web; Facebook was a idea born out of a Harvard dorm 4 years ago, and the IPad is this years possible game changer for magazines and E-Books. Think about all that content, the streams content is provided, and the platforms for access – that is the key to understanding. Very little requires payment, most does not even require a user name and password, and for any specific topic, or news item, there will be a myriad of links, articles and web pages.
That is especially true when it comes to News. Print, radio and TV news all have web content – and compete with each other, and newer online only media sources (locally in BC Canada, like the Tyee). So what makes the Times UK or the New York Times special enough that the majority of their current online viewers will cough up a subscription fee? Very little. News is available from a wealth of sources that will continue to remain freely available – BBC, CNN, CBC, are highly unlikely to charge for content, and viewers seeking a daily dose of local, national and international news will simply avoid paying in favour of free. (and freely available – ie: no need to sign in). Media paywalls for basic news will simply drive viewers away, and deepen the revenue problem. Fewer visitors equals less advertising revenue, with subscriptions needing to be impossibly high to generate any profit.
If the argument is that users will pay for unique content, the NYT experiment in 2007 to charge for opinion articles proves the opposite. While Maureen Dowd, Gail Collins, Paul Krugman and many others are wonderful writers for the NYT, and often provide unique insight, they are only a small part of the paper, with most being news, as mentioned, freely available elsewhere. When the NYT placed their star columnists behind a paywall online readership dropped so far (nearly 75%) that is was the writers themselves who demanded a return to free content. Few were willing to pay for the NYT’s ‘unique’ content, they simply went elsewhere. Yet, once again in June, the NYT will place ALL online content under a subscription and the result will likely be the same – few long term pay users, a drop in advertising and a possible fatal plunge in revenue.
The same is true of the Times UK – what is unique, worth paying for from a newspaper where similar content is freely available from the Guardian, Independent, BBC…? Do Matthew Parris, India Knight, or Bronwen Maddox rate highly enough? No. In fact the real danger for the pay wall publications is not only revenue failure, but that the writers and Op-Ed contributors will jump ship with the readers. Writers need readers, as much as they need a salary. When readership drops, influence wains.
So what is the answer? Well, it’s not pay walls. The NYT and Times UK will prove, in short order, to every other publication this is not the route to follow. There may not be one single model that offers profit for quality content – rather a combination of streamlining, advertising, government assistance (as in France) and philanthropy.
If you have a spare 52 minutes, the brilliant Clay Shirky expounds on the ‘crisis’ in news gathering and provision, and prophecizes on a potential future.