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Someone must pay the bill for journalism

Posted by GNC at 6:44 PM on May 14, 2009

Someone has to pay the bill for journalism.  Whether it be in print, radio, video, or online, someone has to pay.  There is no such thing as a free lunch.  What has paid the bill for news so nesfar?  Advertising, advertising, and more advertising.  Everything from full page ads to 4 by 6 ads to the classifieds.  Everything has been paid for by advertising.  Advertising is supposed to bring in business that makes the investment worth it.  Now that ad revenue is reminiscent of the first hill of a roller coaster, all media depending on advertising is struggling.  Newspapers are getting hit with an equivalent left right combo from the fist of George Forman.  Not only are the ads drying up, but the internet is pulling away readers at an alarming rate.  What will they do?  Robert Murdoch wants consumers to pay for the online content.  Good luck.

Consumers must pay for what they consume. We pay for the meal we consume at McDonalds.  We pay for the gas our car consumes.  Consumers makes the economy go around.  The recession has put consumers on a diet and hunt for really cheap and free food.  No meal is ever free or cheap. Someone is paying.  How will consumers pay for journalism in the post-recession era?  Advertising will rebound, but businesses will refuse to put all their eggs in that basket again.

Here is my one idea to throw into the mix.  News organizations could begin to offer paid-for services to consumers that help supplement the advertising revenue.  Perhaps offering personally configured, organized home pages for a small fee.  Or maybe a PDF of your news delivered to your inbox at configurable intervals throughout a day.  The advertising from local businesses could be targeted to the consumer based on the types of news they have selected (not unlike Google).  Web 2.0 is making this all possible.  If news sites keep making us navigate through their selected structure, or read the headlines they suggest it will not be as effective as it could be.  Just an idea.  An idea that has many flaws I am sure, but some possibilities.

So what are you willing to pay for?  There are no free lunches in this world.

4 Comments

  1. From Jay at 8:24 am on May 15, 2009

    Why is the model changing? Advertising has worked for 70+ years the only difference now is that the consolidator (the search engines) have monopolized the advertisement model. I feel the newspaper industry needs to figure out a way around the search engines. People will not suddenly start paying for something that was free before or where they can find a free alternative.

    The best approach is to get some device tie-ins such as a dedicated viewer on phone models. Also directly linking from Tivos and ebook readers will assist in getting materials directly through to their customers without losing advertising revenue to Google and others. Get people going directly to you and hitting your advertisements first before losing advertisement money to Google, Yahoo, and MSN.

    The other problem is that the newspaper media is no longer producing real or local level relevant materials. Most newspapers are getting materials from Routers or some other larger consolidator rather than providing real local level journalism. The real journalism these days occurs at the blog level and neighborhood bloggers are producing better and more timely materials at local levels. Why can a local blogger be profitable yet a local newspaper can’t? The reason is mismanagement and not knowing or interacting with your core audience. Newspapers are simply not keeping up with their readers and need to find new ways to interact with their local communities. Any paper depending on Routers for the bulk of their stories deserves to fail.

  2. From Nolan at 6:17 pm on May 16, 2009

    I certainly agree that no one will want to pay for something they have always received for free. The reality is that, as Todd said in the last podcast, the NY Times with 9 million unique visitors could only support 5 or 6 full time people. The web is spreading all the ad dollars so thin that consolidated and accurate news is completely threatened. I love blogging but there is no one to hold me accountable to investigating and reporting the full truth. Anyway thanks for the comment, great points, well written, and good discussion!

  3. From Jay at 8:23 am on May 18, 2009

    Good point Nolan. The problem is that if the Times is only serving 9 million, then that is their current online market. (Their readership is more than just unique visitors- unique visitors does not measure repeating IPs because most ISPs reuse the same IP addresses. Also all measurements should be done on revenue on advertising hits and not page views- useless statistic from a financial perspective- can be predictive for future profits, but useless when calculating current financial gain.)The times needs to think about how to expand their readership which probably is not best served by locking down their content. Also the competition is greater. Any 12 year old with a blog can beat out the 60 year old reporter now.

    Newspapers are a business like all other businesses. The market has changed and the business models have not adapted. If there is only a market for 5 or 6 people in production then that is what is needed to serve the demand. Business practices are always about supply and demand. It is really that simple. If what they produce now requires that type of staff then that is what they will need to do.

    Bemoaning the lack of investigative research is a bit faulty as well. I normally see more investigative research on websites like the Consumerist or developing out of grass-root efforts on Digg or Reddit, then I’ve seen out of newspapers. Sometimes I see month old material that the Times tries to pass off as new from differing online aggregators and blogs. Revolutionary investigative research rarely happens at the big media level anymore. People not familiar with the blogs like Gothamist might think these topics are new, but to the locals in NY and the east coast many of these subjects are months old from other sources.

    There is a problem with the old school thoughts on investigative research. Newspapers think this activity can only come from their seasoned professionals with tons of experience and credentials for insider contacts. However, it is now often the person wronged that puts the material directly online to the masses in an unfiltered manner on a twitter post, facebook, digg community, etc… Additionally I have not seen that much more accuracy from big media to justify the difference. There have been several “less public events” about seasoned journalists making up stories and putting out faulty stories. Certainly the seasoned journalists write better, but as far as accuracy I’m not sure about that. If you want accuracy read a scientific journal or GAO report that has been peer reviewed by 20 or more experts. But judging from how many people generally read peer reviewed source materials, accuracy doesn’t seem to be a significant factor considered by the average revenue generating reader. There are problems, but I just don’t see big media discussing these problems in a serious manner or actively trying new approaches. They are doomed unless they try to adapt and include their readers into a community.

  4. From Jay at 8:01 am on May 19, 2009

    Just as I was talking about. The creation of a social network boosts WSJ.com 160%:

    http://www.huffingtonpost.com/andy-plesser/wsjcom-has-huge-traffic-g_b_205024.html