Somewhere over the paywall: three predictions for news media
Two weeks ago, some colleagues and I attended a Frontline Club talk on apps, paywalls and the future of journalism (for a recap, see William Owen’s excellent post). I found the experience very interesting but also very frustrating. I should say up front that this post is deliberately provocative: I am heartsick at the state of the news industry (one I respect and value to no end) and I want to do something about it — or at least start a discussion that does.
Publishers are erecting paywalls all over the place — The Times last week, The New York Times next year — but to what end? By throwing their content behind paywalls, publishers are indulging themselves in a knee-jerk reaction that — I think — will decimate their market share and brand value, ultimately to fatal consequences.
Publishers should be rethinking digital as a universe of potential profit. They should be embracing change and changing with it, but instead they’re freaking out and locking up the content. This just won’t work.
The internet has irrevocably — and nearly globally — democratised information. Content as content is free, and content producers cannot ask consumers to change their behaviour or expectations to meet a bottom line. That’s just not how it works. There is so much good content out there, people will simply decline to pay and move on to a free content source — and there are many.
In order to survive, publishers must change the way they approach the business of content, newspapers, and digital news platforms. Here are my three predictions for the industry.
Prediction 1: Content must become a service
Publishers are in the business of content, but that content must be sold as a service. Crazy newfangled idea, you say? Not really. News publishers once offered an amazing service — the newspaper. This lightweight, portable, affordable, disposable device brought together a world full of information and opinion and presented it to the customer in clean, relatively error-free prose.
This once-exceptional service is now relatively obsolete. Sure, there are legacy customers and habit-driven customers and only-when-I-fly customers out there, but once the coming generation of (I’m sorry) digital natives tips the consumer balance, that’s it for the ‘broadsheet as standard-bearer for news media’ era.
It follows that to survive, publishers must craft a new service that people like you and me didn’t know we needed, but will pay for and love and advocate (i.e. the newspaper subscription as an adult rite of passage). This can happen, and it must happen if news media is going to survive — which it *must*. Who can imagine a world without the Fourth Estate?
Publishers who fail to transform their content into a service will lose money and become obsolete. Content, and even content-plus, is not enough: the FT’s Alphaville is a service; The Times is not.
William mentions in his post that a lot of publishers still think that a newspaper’s competition is other newspapers. This is *so* narrow-minded. It’s also horrifically limiting to the industry’s potential.
A newspaper’s competition isn’t another dying dinosaur — it’s a new creature altogether: a news service that provides all the content I want, in the way I want, and thus eliminates my need for the newspaper.
This service could do so much — just for starters:
- Pull together all the content out there, including the publication’s own, and present it in the context of a larger societal debate, maybe featuring the columnists and commentators I love
- Capitalise on the glut of (free, quality) content out there and offers me a handpicked list of suggestions — this would save me time and connect me to content and conversations I didn’t know about, but will love
- Facilitate real-time dialogue about what I want to see covered
- Build a service around archives so when I pay to view or download a back issue or old article, I get a time-capsule of information that gives me real perspective on that moment — photos, a soundtrack, data visualizations, top stories that day, socioeconomic data, and so on
- Geo-locate content as it’s published, and feature live blogging or moderated debates with subject experts in a way I’ve never seen before
Whatever this service is, it must make my life easier and more enjoyable. It must save me time, anticipate my needs and astonish me with its ability to exceed them. That is the competition for newspapers. Not a paywall or a single app, but a content service that demonstrates what a faff and waiting game the content buffet has become.
Prediction 2: Platform agnostics are making a big mistake
At the Frontline event, Marybeth Christie, the FT’s product manager, said that “we charge for our content, not the way you get it”. A lot of publications are platform-agnostic — The New Yorker has just announced intentions to go that way.
My issue with platform agnosticism is that in assuming customers are paying for content versus the way they access that content, publishers ignore context. They place a zero value on the time and energy spent accessing content — and whose time is worth nothing?
Mobile, iPad and whatever other platforms demand a tailored content service. If I’m accessing a news publication with my mobile, it’s a safe bet that I’m not in front of my computer. I have a smaller screen, a smaller keyboard and probably less time to browse. My experience should be markedly different than it would be on my computer or on an iPad, and if the service is good enough, I should be — and am — willing to pay for that difference (especially if it is easy to pay).
Several magazines are taking the nod here — newspaper publishers should too.
Just as publishers should charge for apps and content services tailored to different devices, they shouldn’t charge for basic online content.
I predict that online (specifically standard browser access) will become the main or base-level means of content consumption, with revenue-earning services (including print) as add-ons. If a user is going to work through a website on a ‘traditional’ browser, they should be able to do it for free (with plenty of ad exposure as they go). All content need not be available on all platforms.
Newspaper Club is one example of a publisher turning print into a service; other online news services like Korea’s OhMyNews — which, granted, has a completely different content model to most — have made money off a less-frequent, more targeted print edition that adds to the digital experience rather than competing with it (and losing). Coming at it from the other side, Vanity Fair is the rare print publication that has made money in the last few years, and features a — free — website that adds to the print experience.
Prediction 3: The way people consume content will continue to dictate the way it is sold
My own browsing behaviour when I am in ‘online information search’ mode — and I don’t think I’m alone here — is sort of like a bee on the hunt for nectar. I’m all over the place. First I want to read this, then the article is a bit slow to start so I move to another story on the same event, but on a different site, then I notice a sidebar and read that, then I think of something else I wanted to read, then I’m off to a blog, etc etc. When publishers start denying me the right to sniff their flowers, I’m out of there and on to the next plant.
Coming up against a paywall doesn’t gel with my expectation of how my online experience should go. It is is, in every sense, arresting. The Times paywall will deny access to a lot of fly-by bees, and I don’t think those bees will come back.
It’s not about the content anymore. As new information consumption devices come to market, publishers must adapt with new platforms and services — and they must make sure the people designing those platforms and services understand the whole picture.
Paywalls are a clear demonstration of misplaced decision-making in service design: you just *know* the people building them (Mr. Murdoch et al) are card-carrying members of the content-trumps-all camp. They don’t appreciate the increasingly central role digital services are going to play in our lives. This is a mistake they can’t afford to make.
It’s going to take some brave, disruptive, awesome thinking to transform the news industry into a valuable part of our shared future. Folks, it’s time to up your game.
All photos from the US Library of Congress courtesy of Flickr Creative Commons
5 comments
Nice post. I love the bee analogy. I completely agree that pay service should be based on the value added by the delivery method (ie the iPhone app).
But I think there’s also room for a paid service that’s more akin to brand membership, that links my experience across platforms. I think people still hold an attachment to newspaper brands and would pay for a unified cross-platform experience. Would I become, for example, a card carrying Guardianista if I could? Probably, yes.
Interesting thoughts – I agree when you say content needs to become a service. Journalists need to find new and creative ways to package the information they have into products we’ll pay for.
I think the biggest growth potential in this area is away from hard day-to-day news, in the more niche sectors of the industry.
@Steve — I’m pleased there’s at least one other person out there who isn’t jumping on the platform-agnostic bandwagon. Paying for content based on the method of delivery sounds like good sense to me.
In terms of your comment on paid service as a sort of brand membership, I think this is very interesting: many people do have a very strong attachment to newspaper brands and I don’t think brands are exploiting that as much as they could. There are a lot of places newspaper brands could go with this — events, supplementary publications, affiliated discounts and memberships… it could almost blur into a social network at some point, couldn’t it? But how much would people be willing to pay? I suppose also, the economic model would have to change, from being a pay-to-consume to a pay-to-belong model where consumption of content is still free.
@Adam — I wonder, though, whether it is the journalist’s role to package content in new and creative ways. At one point — still even now, I suppose — it was the role of the big news media publisher. That is changing — I don’t even think many will be left in ten years time. But news will still need to go from the journalist to the public in an organised, monetised manner. Someone is going to have to do that, I just don’t know how those people or organisations will function.
In terms of your second point — a focus shift away from hard day-to-day news — I am starting to come round to this. Taking this a step further, with Reuters and AP monetising content already — differently to how newspapers do it, but they are doing it successfully — do we really need five different correspondents on the scene? My view has always been yes, but a few people I have spoken with seem to think the opposite.
The New York Times does some brilliant niche sector reporting, which can be very expensive to do. I suspect the coming paywall is to enable the production of that high-quality, niche content at a time when other publications are looking to cut content costs. If they can find a readership to pay for that content, they will be the envy of so many in the industry. One to watch, for sure.
Thank you both for your comments.
Great piece; poses questions I regularly ask myself and raises well-thought out points which currently exist in my mind as mere online browsing frustration.
On the subject of brand membership, beyond advertising the ‘fanbase’ must surely be where a newspaper begins it’s financial planning – the expected revenue source – but like all things online in a human world, we’re still a society who remembers what it’s like to hold the product in our hands (however damaging to the environment!), think CD’s and DVD’s. Are we happy to pay the same for a legally downloaded film as we are for a physical product? I don’t think so. Therefore the starting point for brand membership pricing would be a portion less than the current cost of physical purchase. With the reduction in manufacturing and operating costs this should be a simple sum, at the least retaining the existing profit margin.
Despite the financial planning, I’ll go back to your initial point, “there is so much good content out there, people will simply decline to pay and move on to a free content source — and there are many”, of course the fans will need their feed…and it will have to be the best available.
Dr. Jones — I think you are right that people will pay less for brand membership and a more ephemeral ‘thing’ (access to digital content) versus a tangible, hold-in-your-hand product (a newspaper). As you say, this puts us in a position where the starting point for brand membership pricing will be substantially lower than the current manufacturing costs, and publishers can find profit in this gap.
The trick lies in giving customers a reason to pay, or creating a content offering worth paying for — as you say, something that is “the best available”. The Times’ current offering, I am prepared to argue, is not worth paying for. Along the same lines, I would say the FT’s is. What makes content worth paying for varies depending on the type of content (niche to general) and how exclusive or current it is.
I think the best solution is going to be in bundling content into a flexible, intuitive service…. time will tell whether anyone else does.