22
   

Are you willing to pay for access to online news?

 
 
BillRM
 
  1  
Reply Mon 25 Jan, 2010 11:21 am
Ok are we mainly in agreement for once that this is going down in flames or do some of us think it will or might work out for them?
Robert Gentel
 
  1  
Reply Mon 25 Jan, 2010 11:24 am
@BillRM,
Neither. They themselves admit that it won't make a big difference. It won't put a dent in their billion dollar debt so it won't be their savior and they won't let it go far enough to take them down in flames and kill their ad model.

It will merely set them back a bit on the web while they give the paywall another try and others will be able to encroach on their traffic and growth. But they won't ditch the online ad market and the online ad market will mature enough to make the folly of their ways more obvious in a few years.
0 Replies
 
rosborne979
 
  1  
Reply Mon 25 Jan, 2010 11:30 am
I think they are going to have to change their pricing structure radically and start selling access to articles for pennies, something like the way Apple is using iTunes to get payment for songs and apps.
Thomas
 
  1  
Reply Mon 25 Jan, 2010 11:32 am
@rosborne979,
rosborne979 wrote:
I would be willing to (and eventually expect to) pay for quality news reporting. I am not willing to pay for the entertainment based "candy" news which currently dominates most media outlets.

Same here. That's why I do pay for online access to the Wall Street Journal, donate to my local NPR/PBS station, and would pay for the New York Times if it became a pay-for-access site. And in the long run, it's probably a good thing for everyone. In news as elsewhere, you tend to get what you pay for.
Robert Gentel
 
  1  
Reply Mon 25 Jan, 2010 11:37 am
@rosborne979,
The micropayments model right? That is the one I think has the most promise as well, but there are two big problems with that:

1) It may introduce a taxi-meter anxiety to reading content online. Even if it's only pennies per article your browsing is now directly tied to your costs and user behavior changes significantly when their behavior suddenly has cost, however slight, directly tied to it.

2) It is not very user-friendly unless there is a payment aggregator like Apple, Google or even ISPs that eliminates the need to break out your credit card for so many different sites and these newspapers know well enough not to cede all the power to another middleman. Their best bet here is to make their own consortium for this.

But honestly, even if micropayments work well they aren't going to beat online ads with this strategy either. They simply aren't going to be multi-billion dollar empires anymore because the cost of information has gone down and will need to produce information more economically. That is the bottom line for them: get leaner.
0 Replies
 
sozobe
 
  2  
Reply Mon 25 Jan, 2010 11:41 am
@Thomas,
Yeah. I'm the only person I know (of many who read the NYT daily) who pays for the New York Times (daily delivery, actual paper paper).
msolga
 
  2  
Reply Mon 25 Jan, 2010 07:34 pm
@Robert Gentel,
Quote:
The problem with this whole model is that they could get almost a million subscribers at $5 per month and it would still be about half of what they currently make selling ads. Even the NY Times admits that this won't have a significant impact on their finances even if their projections are right and that this is about going where they think the web is going.

I think they are making a big mistake.


I'm not disagreeing with you, Robert. Clearly (in the short term, anyway) this is not going to have much impact on the NYT's financial concerns at all. My hunch is that it may have more to do with long term strategies & the possible rationalization of print & online resources.

ossobuco
 
  1  
Reply Mon 25 Jan, 2010 07:40 pm
@msolga,
So now it'll be $60. a year (presumably), instead of the $50. last time. They'll lose me again. More a loss for me than for them, as I'm a daily reader online and fit the pattern of not purchasing from advertisers or even clicking on them much - but I'll adjust a second time.

Interesting discussion; RG's takes make sense to me.
Irishk
 
  1  
Reply Mon 25 Jan, 2010 07:58 pm
@ossobuco,
Quote:
Are you willing to pay for access to online news?


Possibly. Probably. The thing with the New York Times is they have original writing not found elsewhere. So, probably.
0 Replies
 
Robert Gentel
 
  2  
Reply Tue 26 Jan, 2010 04:19 am
@msolga,
msolga wrote:
I'm not disagreeing with you, Robert. Clearly (in the short term, anyway) this is not going to have much impact on the NYT's financial concerns at all. My hunch is that it may have more to do with long term strategies & the possible rationalization of print & online resources.


That's exactly what they think but I think they have the long term quite wrong too. In shorthand:

1) They used to be gatekeepers of information and the only real game in town for local advertising (yellowbooks showed up eventually), classifieds etc.

2) With each new technology that supports information sharing and advertising they lose their significance in society. This is simply inevitable and there's no "fix" to it. Radio eats at their advertising and information sharing dollars, TV does and the internet eats at all of the above.

3) The money in this all along has been advertising. It's never been about the end user paying and even if you succeed in getting them to pay the most they really will it just won't add up to yesterday's media empire dollars. So the problem, for them, is that online advertising is wide open. You can buy through one agency like Google, Yahoo, Microsoft, and thousands more, and reach up to hundreds of thousands of publications and have your ad delivering in minutes. The end result of this is that this is a much cheaper medium of advertising and the publishers get a lot less per eyeball than they do offline right now.

4) Publishing on the internet is so relatively cheap and the barrier to entry is so low (think about it, a2k was reaching millions while I was still making minimum wage and brand new to the internet myself, that just won't happen in any other publishing medium as easily) that paid content is going to have to be unique, and news has great difficulty being unique. Even if you get a scoop others can report on your scoop right after you break it. Your uniqueness in news lasts minutes. So you need huge differentiation to get away with being able to charge at all. Think about how much paid content you have consumed on the internet versus how much free content you've consumed.

The willingness to pay will increase, but it will forever be dwarfed by free content because the economics of free content make sense through advertising. So if you make people pay, you will lose traffic because there is no switching cost to just surf to a free source. This is why all these paywalls can easily be circumvented, there are perverse interests here where they want to charge but want to still be part of the free open web. So if you just visit from another site it's still free and I could make a browser extension to get you a free pass using their own loopholes that they made to try to keep free search traffic.

5) The ad market online is a baby. There's still very little branding dollars being spent online but the market is growing like a weed and eating into all other forms of advertising. It's not going to stop till the next medium eclipses the internet and Google doesn't make money by being a search engine. They are the new media powerhouse ad agency.

So these companies get mad that their content is in Google, that Google is the new ad king and they finally aren't going to take it now that they finally get the internet's impact. But they can't turn back the clock, and trying to charge search engines for allowing them to index their content (this is also being explored now) or charge users to read their content is to shoot themselves in the foot.

What they need to do is fight for their advertising relevance, and for that they need all the eyeballs they can get. Instead of trying to nickel and dime their readers they need to be trying to establish a viable alternative to Google advertising online and by charging their readers they are reducing the eyeballs for a pittance. The long term is where they will pay the most for it. Right now they can balance this game so that they can make a bit more money by trying this or lose a bit. But they can't get the growth they lose back 5 years from now when the online ad market is that much bigger and they are that much further behind.

It's sad for me to see the NY Times do this, because they are the most internet-savvy big newspaper around (they even have an API). From what I can tell their old-world execs were for it while their internet execs were against it in very heated internal debates.
BillRM
 
  1  
Reply Tue 26 Jan, 2010 12:49 pm
@Robert Gentel,
Radio stations are all doom also as devices to get streaming audio on the go become more common in that the cost to setting up an internet "radio" station such as the one I am now listening to is dirty cheap compare to an over the air station and no FCC to fine you if you broadcast something of a nature they do not care for either.
0 Replies
 
Robert Gentel
 
  1  
Reply Wed 27 Jan, 2010 01:54 pm
@Robert Gentel,
Robert Gentel wrote:
... the suspected launch of an Apple tablet device on Wednesday that some argue is aimed at becoming the middle man for old world media like magazines (where it can shine above the Kindle), newspapers and books.


So the iPad, not iSlate, launched today and it looks to be making a significant play at the kindle through iBooks and does indeed look to be aimed at newspaper consumption as well, given that the NY Times was already working with them on an iPad-specific version.

http://cache.gizmodo.com/assets/appletablet/appletabletb364.jpg

Depending on how mainstream this goes this could be a bit of a boost to newspapers and magazines and Apple seems to be betting that this will go big like the iPhone.
Eorl
 
  1  
Reply Wed 27 Jan, 2010 08:49 pm
@Robert Gentel,
Who wants an iPod Touch that won't fit in your pocket? So I can read the NYT on the subway in a format that begs for the hardware to be stolen at knife-point?

Maybe if it could multi-task I'd be vaguely interested. As an owner of a MacbookPro and an iPhone 3G, I'm seriously underwhelmed by this iDud. All of which means I don't think this will change anything.
tsarstepan
 
  1  
Reply Wed 27 Jan, 2010 11:17 pm
@sozobe,
sozobe wrote:

Yeah. I'm the only person I know (of many who read the NYT daily) who pays for the New York Times (daily delivery, actual paper paper).

Ironically when I lived in Framingham, MA from 2001 t0 2002, I subscribed to the New York Times, (also the time of my own personal prosperity). Subscribing to the New York Times was far more expensive then subscribing to the home delivery of the Boston Globe. But when I moved to New York City itself I could not afford a newspaper subscription. Hence I became dependent on getting access to the NY Times via the website and the occasional purchase at a newspaper stand.
0 Replies
 
tsarstepan
 
  1  
Reply Wed 27 Jan, 2010 11:22 pm
@Eorl,
Clearly you're not a New Yorker Eorl as I see plenty of people whip out their laptops on the subway and do whatever they're doing with their laptop. Clearly it isn't wifi accessible down there. Laptops are larger visible targets then something that's slightly larger then a Kindle (which I do occasionally see on the train as well though I still see more laptops then Kindles).
Eorl
 
  1  
Reply Thu 28 Jan, 2010 01:11 am
@tsarstepan,
tsarstepan wrote:

Clearly you're not a New Yorker Eorl

You may be onto something there!
0 Replies
 
 

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