Pay Wall II will charge an audacious $9.50 a month for access, the same price as a print subscription. This price, of course, has no relationship to the cost of placing the news on the Web. The newspaper's Web site has no printing costs, no delivery costs, no mechanical infrastructure. It appears to be a price aimed at shoring up print subscriptions — subscribe to the Web edition and get the print edition for no extra cost. Buy one, get one free? Something is needed; I'm told that the newspaper's circulation, which peaked above 18,000 when I was there, has fallen below 15,000.
This aggressive pricing has been advocated by some of the "experts" offering advice to a newspaper industry that is clearly in turmoil. News content is costly to produce; it has value; anyone accessing it, in print or online, should pay for that cost, these experts say.
Others are not so sure that's the right approach. Most state, national and international news probably will remain "free." There's just too much competition and too little consensus about how to charge for this information. Local news might stand a better chance of surviving behind a pay wall, but this news has to have real value sufficient for large numbers of people to want to pay for it. And entry into the information business is so inexpensive these days (no need to buy a printing press, and there are plenty of out-of-work journalists to hire on the cheap) that even highly local content providers have to beware overpricing their content. An upstart competitor could easily overthrow their monopoly.
The fundamental problem is that the newspaper business model has broken down. For generations, newspaper owners got rich by delivering reliable readers to advertisers. Now readers are less likely to read a newspaper because they have so many other options, and advertisers are concentrating on the narrowly targeted cohorts of buyers delivered by Internet search ads and other innovations instead of the shotgun-blast approach of hitting the entire population (or large portions of it) via newspaper ads. Charging for content, which newspapers never really did (subscription prices used to cover only the delivery costs), is one answer to this quandary, but it might not be the best solution.
What is the best solution? If I knew the answer to that, I could be a consultant and make big money instead of giving away my opinions for free. I do know that charging for content that used to be free will only anger the people accustomed to dialing up the newspaper Web site whenever they feel like it, and restrictions will sharply reduce traffic on the Web site, making advertising space there less valuable.
It's a bold but risk-laden strategy, but these are desperate times (no pun intended).
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A year ago, I would have thought charging for content was folly but most newspapers no longer have 5 years, 2 years or even 1 year to wait for Internet advertising to produce enough revenue to do more than stock the company restrooms with toilet paper. The readers who only read the online version weren't exactly contributing to the ever-lowering bottom line and the loss of Web traffic isn't likely to make much difference in the paltry Internet ad revenues.
So, the best thing to do (which will be more effective if many other newspapers follow suit), is to ask people to pay for the product. Sure, a quarter or 50¢ per paper copy seemed like a pittance but if 7,000 subcribers are paying $10 a month, that's $70K in monthly revenues that cover quite a bit of costs.
The only other option as I see it is to drop the print product all together and hope that local advertisers will pay higher Internet ad rates. Certainly the current Web advertising wouldn't pay for much of a staff. Either way, it's a gamble that's sure to outrage some of the readers.
In any event, I don't think it's unreasonable to ask readers to pay for the product, even if they were getting it for free for the past 5 or 6 years. I don't know of many businesses who are expected to hand out their product for free.
Of course, if the newspaper industry got some of that federal bailout money, I could see how the idea of free online news would be reasonable. But government-run news organizations are a whole other ball of wax...
I agree, Paul, that newspapers are up against a wall and have to do something. I'm just not convinced that a flat subscription rate for online access is going to work long-term. The most intriguing suggestions I've seen over the past year or so that I've been following this debate are (1) micro-payments for access to individual stories or (2) a federal tax credit of $100 a year for anyone subscribing to a PRINT newspaper (the feds have bailed out other industries, and an informed public/electorate is in the national interest). The Associated Press announced more layoffs yesterday, so the problem is widespread and deep, and the information that is essential to a functioning democracy is in jeopardy unless newspapers survive in some form.
I'm not convinced it'll work either but it's a start towards trying to profit from the product once again. I think other options are being considered and maybe new alternatives will arise. But right now we're stuck between readers unwilling to pay for news but howling when they don't get it for free, so that tells me they still want it, they just don't want to pay for it because they've been getting it for free ... Of course, I'm all for free news if I can get everything for free since I'll no longer get paid. ;)
The current model will only work when you have content to offer for a community that is interested. Larger papers can probably get away with a wall because they offer more content. Example: when the NYT goes pay, again, I'll be happy to subscribe, as I've again become a habitual NYT reader, this time in the form of my iPhone. I wouldn't even pay for a subscription to my hometown paper's Web site (which is a wreck).
The problem here is access to important information for a small community. A small paper still has an obligation to this community to share important information, especially in a time of potential harm or disaster. We know from experience that authorities will only disseminate information they deem necessary in a time of crisis. Without the facts — preferably collected from a reporter pressing authorities — this could lead to hearsay and worse, panic.
The paper could easily say they would open the Web wall in a time of emergency, but by then, anyone wanting information will already be trained to go somewhere else for information.
Well, if a newspaper's content isn't of interest to its community, then it won't take long for it to go out of business. However, I don't believe residents of Wilson would be happy to have no source of news here.
I picked up the paper the other day at the office (as I don't actually buy it), and was shocked at how little was in it. I found a mailbag heading, yet no letters. Ahhh, but I did find a rather odd full page birth announcement. Seemed a bit show-offy and TMI. There went the excuse about a bad economy forcing newspapers to cut back.
And the paywall thing? Besides a tricky way to keep reader opinion at bay, Read up.....
http://finance.yahoo.com/news/Newspaper-circulation-may-be-apf-2734636635.html?x=0&.v=3
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