On Newspapers and Paywalls

It may be a cliche to write in the Huffington Post that newspaper content should remain free, and I may tick off my friends at newspapers by doing so. But even as an ex-inkstained wretch myself, I couldn't avoid the contradictions contained in this week's report by the American Press Institute: its Newspaper Economic Action Plan.

The basic idea: newspapers should start charging for their content ASAP. Readers, Google, and aggregators including the HuffPost should all pony up. Why? Because newspapers spend money to bring us their reportage. That coverage is important to society. It doesn't come cheap.

The problem with a "we produce something of value and should be paid for it" attitude, though, is that it is just an attitude, one shaped by a sense of grievance and a gut feeling about what is - must be - right and just. This is a terrible way to formulate any kind of complex strategy - George W. Bush made decisions the same way. In this case, the API ignores the real world conditions of journalism, the Internet and e-commerce. Thus this strategy, if pursued, is unlikely to turn out well. I want newspapers and journalism to survive and thrive. And I'm not against charging for some content if it's done right. But even I can see this is crazy.

Start with the API's first recommendation: "Establish a true value for news content online by charging for it." This is a strange formulation. In a market, prices are set by supply and demand, not dictated by producers. The declaration has an anachronistic, command-and-control, almost Marxist feel to it: we control the means of production, we will set the prices. It assumes a kind of monopolistic position that newspapers no longer hold, as much as they might want to. If your starting point is the assumption your product has "value," you'd be wise to take a hard look at exactly what that value is on the open market - not try to spontaneously create a closed, captive one. But the API evidently has not conducted that kind of clear-eyed self-assessment. It sees the economic value of newspaper content as self-evident, of a piece with its perceived social value, and something that must be preserved first, improved upon later.

But the truth is that newspaper journalism has a relatively low market value and its social relevance is in decline. It's still important - we need eyes on government at all levels, investigations, a space for local and national community discussions to play out. (And yes, the HuffPost certainly needs it.) But the form of the newspaper story is stale, and the package it comes in - the selection of the day's news, calendar, arts, classifieds, etc. - is something many people no longer really need because they can get most of it elsewhere. Meanwhile the relative social importance of newspaper stories - as a forum for political debates, say - has also declined due to ever-fragmenting attention, competition, and a loss of credibility that's partly self-inflicted.

The API's answer to this is to double down on existing, loyal newspaper fans: "The real value to newspapers comes from serving ... 'core loyalists,' the group of heavy users who visit a news site about 18 days a month, two to three times a day. They contribute 85 percent of the page views and user sessions." But surely this base is already in decline, unlikely to replaced by younger readers.

These problems are severe. The obvious solution to them is to make a better product - leverage the advantages you have, innovate, create something people really want, and thus make yourself important again - and in the process, figure out how to sell it. The marketplace of the open web is the ideal forum to test this out. (I acknowledge that many or most such tests will result in failure.) The API report makes some gestures toward innovation - but only after enumerating ways to monetize content. Its basic approach is, we've already got a golden goose here, people are stealing our eggs, and we want them back.

That's the other principal problem - the report urges a crackdown on the cribbing of content by Google, aggregators and others: they should pay or cease and desist. There is plenty of abuse of "fair use," and original content is endlessly atomized. Perhaps there are ways to police the egregious cases better and/or generate revenue from "republishing" if all involved are amenable. But is this really a wise foundation for a future-of-newspapers strategy? Here's how the report envisions the politics:

Many citizens and policy makers regard newspapers as an essential part of the American democracy as evidenced by a recent congressional hearing and a spate of conferences. The sustainability of journalism is important to Americans, and thus, there is a public imperative to ensure, and monetize, the survival of professional news organizations in some form.

You can read this two ways. Either the newspaper industry has civic obligation to charge for content, or society itself must recognize the importance of newspaper content and compel politicians to protect it. The first idea is tendentious, the second naive. The public isn't particularly sympathetic to tougher copyright enforcement. The lobbying clout of newspaper publishers and media companies is declining with their corporate valuations. Google has lots of money to spend on its own lobbyists. And the current copyright regime is outdated. When it's reformed, who knows what will happen?

It's not like the API report contains no good ideas. No doubt there are ways to charge for premium content as it suggests, for example. But your average small or medium-sized paper doesn't have much (or any) of that, nor does the API give any examples of it. And if your strategy is shaped by an inflexible set of beliefs and an attitude of entitlement, it's not a recipe for innovation or success. After reading this, I'm more pessimistic than ever about the future of newspapers.

Comments

[texastrixie]

While the online world seems to be superlative at muckraking, gossip, and scandal, I see little evidence that major news gets much play on the iinternet. And frankly, myself included, who really cares about the opinions of the millions of bloggers on the net. None of us has real power, otherwise we wouldn't be working for nothing.

I cannot afford to pay for newspapers online, simply because even micropayments would be more than I could afford. I think the only thing that can save newspapers is for them to die. Once organized news agencies die, and the few remaining start charging a fee, people will begin to realize how much we need an organized news & research counterpunch to govt, big business, etc.

[OtayPanky]

texastrixie: people will begin to realize how much we need an organized news & research counterpunch to govt, big business, etc.

===

I think that a lot of people realize it already.

The question is not WHAT to do (investigative or muckraking journalism). It's HOW to deliver it so that it makes sense as a business.

That's where newspapers have become an EPIC FAIL.

The essential function of journalism can be delivered in any number of ways, in all sorts of media, profitably. It just can't be done in a newspaper format anymore.

[RumiSouth]

There was a time when newspapers could have OWNED the internet. Instead of innovating, they stagnated in the name of corporate profits.

Take my own home paper as an example.

I've watched with dismay as The Times Daily let good journalists go and hired newly-minted journalism majors (not graduates, mind you) at $8 an hour to pen trite ad copy disguised as news. They outsourced their prepress department, trimmed the pages to near-tabloid dimensions, and called it "innovation" because they could put color photos on the front page.

All of this was in the name of 'cutting costs.' In fact, The Times Daily is still highly profitable but has belonged to a major national company with lots of middle-management salaries to pay.

Consolidation has not improved the news in any way, shape, or form; that pigeon has come home to roost.

Google is getting blamed for this sorry state of affairs, and it's not just because the newsmen are jealous of Google's success. They are jealous of Google's mastery of technology. Instead of innovating, the big papers bought little ones and played at being Fortune 500 companies.

Proof they allowed their technology to stagnate? If you really wanted to cut costs at my local paper, you could fire the editors who've been there 25 years without ever mastering spellcheck.

http://www.osborneink.com

[OtayPanky]

Local news organizations - in whatever media - have only one LEGITIMATE journalistic product to sell: good, solid, fact-based muckraking.

Everything else is covered, and available either free or in a more valuable format for which people can and do pay (examples: The Economist, Variety, Scientific American or the WSJ).

Muckraking doesn't require the huge overhead of a local newspaper. You could keep the 5% of the staff that actually DOES journalism, and aggregate them effectively into a profit making local meida outlet. They'd still be able to serve the same journalistic function of exposing corruption, or bringing local attention to a situation that truly needs it.

On a national and global level there are two types of stories: Those that require on the spot, up to the minute reporting (like Katrina), and those that require the kind of deep journalism work that Sy Hersh does for the New Yorker. The former is well covered by all sorts of news organizations, both domestic and foreigh. The latter doesn't require a daily publication of any sort. For in depth stories requiring a deep dig, magazines are the perfect platform.

The newspaper paradigm is DOA. It's our generation's buggy whip. Changes in technology have made it obsolete. While some folks (mostly OLD folks) gripe about the imminent demise, most people just don't care - which is, in itself, the kiss of death for any product, in any market.

[TheEmptinessOfTruthiness]

I often hear about the need for there to be "eyes" on all levels of the government.

I believe that to be true - however I never hear about the necessity to have "eyes" on the corporations who increasingly dictate the conditions in which we live.

But then - what else can one expect from a corporate media?

[noamjunior]

so here is the problem with the newspapers reasoning - they say they need to charge a fee for internet content so they can pay for quality investigative journalism, yet in the last ten yearsUS newspapers completely dropped the ball on investigative journalism. In the last ten years, cutting staff to save costs, pushing syndicated cons on the op-ed page, and cheerleading the Iraq war. I didn't stop subscribing to newspapers becasue I dont want to pay for content, I stopped because I am unwilling ro subsidize corporate media

[rob515]

What I like most about Google, Huffington Post, and blogs is the ability to read the news from different sources. You can view the news from different perspectives. If I had to pay for subscriptions to each newspaper online, that would be financially prohibitive, and I would never get to hear from valuable resources that I discover only through aggregators. However, I understand that collecting news and investigating events costs money, and I would be willing to pay for this, provided that I was given a resource that accessed as many sources as, say, Google. So if there were a fee that I had to pay to a resource like Google, and then Google would share it's profits with whatever newspapers I read. This would give me the flexibility I seek, and would also add revenue to the newspapers.

[cdembrey]

Why is it OK to charge for a print edition of a newspaper, but it is BAD THING to charge for the same news/articles on-line???

What happens if tomorrow ALL newspapers stop publishing, AP, AFP, Reuters, and the BBC stop collecting and distributing news? What if Magnum Photo, VII and other photo agencys stop sending photojournalists out into the field? What if investigative reporters, like Seymour Hersh, stopped investigating? No more political cartoons being drawn? Do you really think that free bloggers could really replace them???

[ssg13565]

The subscription cost of printed newspapers does not cover the cost of gathering, printing, and distributing the news. Advertising pays for most of it.

When the newspaper goes online and does away with most of the printing and distribution cost, why would they expect to take all the benefits of that cost reduction? That may be what they want to do, but that is not what the customer wants to do. Since this is a supply and demand situation, the eventual price lies in a balance between the seller and the buyer.

Moreover, newspapers have been able to develop monopolies within their print distribution domains. On the web their is no more monopoly. Did the papers really expect to continue with their illegal monopoly profits and decreased product quality when they no longer had the protection of having a monopoly?

[AntsyAmerican]

In response I would ask, how much would it be OK to charge for the printed edition if the costs of physical publication and transportation weren't a factor? What if their only costs were related to creating, hosting and marketing the content?

That's the magic number that hasn't been found, because web ads, by virtue of their measurability, cost considerably less than print ads.

[noamjunior]

well, the BBC isn't about to tank, AP has turned into a con talking point machine, - I PAY for my New Yorker subscription. As for NEwspapers charging for content- no way AM I paying to subsidize their con op-ed pages, so screw them.

[grey sells]

I stopped buying print media because I thought the value of their product had declined. Reason? I think they are lazy, relying on "informed sources but not for attribution" and surrogates, shills and spinmeisters. I now exclusively use the internet and "drill down" when I am interested in something. The business model on print media is broken and I see nothing yet that would even remotely encourage me to buy newspaper stocks.

[AntsyAmerican]

Agreed, the mainstream media picked a bad time to fall down on the job these last ten years or so.

[lsockett]

I don't understand why newspapers would try to charge readers for regular on-line content, when it would be so easy to get the same information off the web for free. The real luxury item continues to be the delivery of the at-home or at-work printed newspaper, so why not charge more for that (I'd be willing to pay -- I love reading the paper over coffee), and give those print readers access to interesting on-line content or offers that regular on-line viewers can't get. I also think newspapers should explore the non-profit model too -- NPR and public radio has been doing surprisingly well in the Internet era.

[AntsyAmerican]

Getting the same information for free presupposes that someone is out there gathering the information.

Inevitably, there will be fewer and fewer of those people, who in turn have a bigger reach because their market is no longer tied to a physical location.

[bayside]

AP a product of murdoch wants to survive..I want that too ,so I am going to tell them why it wont work charging for content..Its all abbout trust..If we dont trust content and we have seen well paid propaganda at our expense for the last 8 years , if you dont bellieve them,then no one will buy anything they say..

[Leper]

The way content is acquired and distributed has changed radically in the last fifteen years. News, music, and fiction, celebrity and nude and art photos, for the last couple of centuries were paid indirectly by advertisement dollars. Advertisements in newspapers, magazines, on radio and television were, generally, unobtrusive and could be ignored at the viewer's discretion. Methods for measuring the effectiveness of advertisements were relatively invisible. Delivery of content was instantaneous.

The web is different. Elements of a web page can come from several domains. It can take milliseconds or minutes to load a page completely (even the same page!). Software embedded in pages to measure "hits" (companies like Doubleclick and Nielsen) can take a long time to load and record the "hit". Advertisements can coexist on a web page (like banners) or can be used as a gateway to content (Salon.com) or can be embedded into streaming media (NBC/Universal). Lack of a standardized method to gain advertisement dollars indicates the industry is still in its infancy.

Few periodicals take advertising dollars. They usually cost more (Consumer Reports).

Content is not free, it is paid for, albeit indirectly through people trying to sell you their product and the people providing the content figure a way to get it to the public with scaring them away with fees, there is going to be a lot more moaning and groaning and hand-wringing by people who need to grow up and become businessmen again.

[logan9]

copyrights as they currently exist stifle growth and innovation, as well as INFORMATION! Information should freely flow, we should encourage an educated public.

It reminds me of some fundamental problems, like... treating our children as people to profit from, instead of students to invest in!

[AntsyAmerican]

How do you propose that the people investing in content creation make a living?

[Jsens3]

How about this. Put nothing online for free and provide matter difficult to duplicate. The best sites with the most valuable information are pay sites. This will require real effort, no just picking up headlines from the services. Fpr example, today everybody knows that David Carridine died. Don't waste time with that. There are hundreds of sites reporting that. Really dig into things. Don't report that the state legislature is about to pass a bill to do something; instead, read the bill, find out its weak and strong points, and interview affected persons - perhaps even the lobbyists. Give the reader something to chew on. Then sell this information.

Recently we had a front page story about a family that lost a jury case for big damages because their son had been shot by police. The news wasn't news by the time we got it. I wanted to know nitty gritty facts. How much did the city offer in settlement; what was weak, what was strong, did the reporters see any possibility of reversible error, how much did the family leave on the table, did the plaintiff's lawyer advise them of the offer; what did he advise them to do? That kind of thing just isn't reported. So what we get is superficial pap. I thought journalism taught people to really dig in for facts.

[NHBill]

You make some good points, but your example is weak. No lawyer would spill the details you are looking for. Reporters can't get blood out of a rock.

[Michael787]

"But the truth is that newspaper journalism has a relatively low market value and its social relevance is in decline."

John, by this measure newspapers should never have existed, have no value or purpose and - by extension - there is no issue. A change in medium does not of itself extinguish either purpose or value.

I think what you're saying is that your journalism is not worth anything and you can't see much that is?

The contrary proposition is that by the financial success of newspapers and their social standing journalism has lost its way, become irrelevant and is now exposed. But not replaced. Unless you suggest that the mindless, self serving junk that appears on blogs etc and generally in the "free space" is somehow reliable, valuable or professional?

Surely it's fundamentally wrong to assume that people won't pay for good journalism? In whatever medium?

[logan9]

Actually I'm not sure that it's fundamentally wrong... just wait and find out should they adopt this all-encompassing pay curtain.

As far as your suggestion that blogs are mindless drivel, well, that's your opinion. But the bottom line is that these bloggers and amateur journalists provide much needed viewpoints and alternative ideas regarding the regurgitated news, which dominates all aspects of our relatively soft media. So to suggest these individuals serve no purpose undermines your own credibility on this topic.

Professional news has been corrupted just as other sectors of our economy! Next you'll tell me that comment threads should be eliminated!

[NHBill]

Newspapers survived on an overwhelming duplication of effort. The internet is causing a massive contraction. I can read Roger Ebert or Ken Turan. I do not need to read a local, minor league critic. Once you eliminate the redundant glamor jobs such as sports or foreign correspondents with excellent talent on the internet what's left? Grunt work at the council meeting or the police department or the rare investigative report. Are newspapers actually doing this work? My experience is occasionally. From crosswords to comics, sports to classifieds, stock prices to movie listing it all works better on the internet. The truth of the matter is when you remove the AP from most papers there is not a lot there. I think they will be shocked at how easily we get along with out them.

[logan9]

Very true, especially with the smaller papers. Without the AP, these papers would be full of even more garbage, even more adverts, and even more 'stuff' I can more easily access on the Internet... for free, and forever!

And if they (whomever that may be) attempt to take this away, I will have great difficulty paying money, in fact, I wouldn't!