Monday, February 01, 2010

Publishers Stroll from Glacier

Windsor walls

Online payments are the big battle for beleaguered billionaires and their slightly poorer near peers. The Rupert Murdoch types cannot abide the idea that somewhere someone is getting something they touched for free.

No doubt that the basis of capitalism is that people or corporations own goods or services they make available for a price. Anything short of profit is called charity or foolishness (often the same to some capitalists). Yet publishers in this world only want conditions to be immutable so long as their profits are as higher or higher than they have been.

Lackaday, that very naughty net has made them look up from their counting tables.

Kind of Disclaimer

I’m prejudiced here. I have always loved newspapers and want them to flourish.

Growing up, we had two to four dailies delivered, depending on the pickings where we lived. I was a newspaper delivery boy. I went to j-school, climbed the ladder as writer, columnist and editor of the student paper (high school and college) and then worked dailies and weeklies in the South. As an adult, I’ve always gotten daily papers, as well as numerous news, literary and specialty magazines. I’m a print guy first, one who has simply added computers and net technologies on top.

I love the feel and smell of good books and magazines.

Survival of the Most With It

All that written, I have no doubt nearly all U.S. newspaper publishers and top editors are atavistic. They have also moved in recent decades with all the speed of a sloth and the judgment of an oat tree.

I’ve touched on this a few times, like here and part two here at Marry in Massachusetts. We got a different view in a Left Ahead! podcast with Martin Langeveld. He was a newspaper publisher and has quasi-retired into among other thing a principal at CircLabs, which aims to help publishers figure out this pay-to-view thing. (Another slight disclaimer is in order; he and his wife were classmates of mine in high school. I disagree with some of his positions, but I know and like them both.)glacier

For this part of the discussion, the big point is that newspaper types saw the internet and its effects coming and coming and coming. It was much less like a train and more like a glacier. Unless you got out of the way or rode that glacier, it was going to take everything in its path. You had lots of time, but you had to decide what to do.

They have remained fairly paralyzed with inaction, indecision and more than a little delusion. Like watching that glacier, they saw new advertising options appear. They heard ad customers say Criag’s List was cheaper and more effective for classifieds and that online advertising offered highly targeted demographics with verifiable click through counts to ideal customers. They even heard to their humiliation that their favorite disdained group, bloggers, were getting snippets of ad revenue that should rightfully be theirs.

One type of response was to try to ride that glacier. Nearly all papers are online in one form or another. While screaming haughtily that they owned the news, damn it!, they responded to their declining ad money in exactly the wrong way — cutting expenses from the bottom, notably reporters.

Duh, as the yellowish Mr. Simpson says. Think, our product is better and worth reading and advertising in, even though we are giving you less of it, less local and foreign news, nothing unique, and nothing you can’t find in dozens of other places.

After slashing their differentiating advantage, reportage, they had yet other dumb tricks to perform. One we have seen even in our stodgy Boston Globe, is blogging. While on the one had ridiculing and demeaning blogs, even refusing to link to those whose ideas and leads they steal, the glib Globe has its own set.

From the beginning of this reaction, we see how out of it newspaper editors and publishers can be. The model is to take decent reporters and columnists and heap blogging duties on them. At the same time there are fewer writers, the remaining ones are supposed to do that on top of their jobs. Rather than giving the writers a chance to pick up a new skill, this looks from the outside at least, like the old “you’re lucky to have a job at all and will do as we tell you” routine.

The blogs show the coercion. Their posts are uniformly boring, show little effort and take no advantage of the medium.

Money, You Say

There’s a credible argument that most existing newspapers need to and should die. Their functions actually would be better performed by new media that understand reasonable financial models, the technology to deliver great stuff in the right formats with the right content, and some courage. The latter would be to do what’s necessary to provide salable product, without being immobilized by a primitive capitalist’s terror that someone might get something of yours without paying for it.

Yet, almost to a one, print publishers seem to have tiny brain pans, more driven by emotion than intellect. You can see that in how lamely they try to extract money from readers and advertisers to make up for their losses in the past decade or so (don’t lose sight of that glacier!).

Consider the scheme too many tried to maintain their many decades old system of high cash flow and higher rates of return. Those are the realities that changed due to the net and most publishers refuse to accept that. Instead:

  • Some came online after many other papers and immediately put up a solid paywall. Almost all content was in headline or incomplete form, requiring a subscription or per-article fee to view.
  • Others, like the Boston Herald here, showed its delusions like raggedly underwear. It tried to charge to read its columnists online. Let’s not even get into the value of a given piece by any of their writers, but suffice it to say, that failed quickly and totally.
  • Still others look at mixed models, offering full access to subscribers and small payments for beyond a monthly limit (the metered model). The FT reports that The Guardian has considered six paywall models.

For complete paywalls, your content has to be damned superior and useful to make a go. The number one fantasy of net-come-lately publishers is that if they pay to produce content, everyone else should be delighted to buy every morsel from them. News Corporation’s Rupert Murdoch is the troll under the bridge here, threatening, popping up, then withdrawing. He rants everywhere that news is not cheap and that anyone putting anything from his publications online anywhere without his permission and payment to him is simply stealing.Page 3/free mix

He even wants to charge for online access to the sleaziest of his pubs, The Sun. Yes, the Page 3 bare breasted babe rag is that valuable, Murdoch would have it.

Amusingly enough, one of his properties, the Wall Street Journal seems to have learned enough from the Financial Times to make some cash online though. In its announcement two months ago that it would copy these two somehow, someway, the New York Times seemed unsure whether it would be micro-payments or some other model. Its bosses do want some kind of paywall though.

A short-term answer may well lie in the partial success of the WSJ and FT experiments. They were not foolish enough to block and drive away casual surfers with solid firewalls and total blocking of content. Instead they provide an example that even the dullest publisher can profit by emulating. They charge for real value.

You don’t have to be in the financial press to consider what they do. Yet, it is obvious for them because it can translate into reader benefit. Some of their articles and columns have specialized and even unique information and analysis. Those who pay for a print or online subscription have a little (or arguably sometimes large) advantage. They are happy to pay.

So, while publishers watch the glacier some more and figure out in what direction to move, publishers can ask themselves what value they can add to attract paying customers (and loyal subscribers). The answer most certainly should not involve firing their writers. Honestly, what were they thinking?

Likewise, many local dailies and weeklies used to be best at hyperlocal content or sports or photography. They have done their best in efforts to cut costs that they eliminated the staff who could maintain those selling points. Moreover, to use a local example, when Bostonians want hyperlocal content, they are more likely to click on UniversalHub, an aggregator of local blogs and other news, plus some original reporting. Such concentrations of news are what the net can excel at and newspapers have largely ceded.

They need to produce content so useful or so entertaining or so whatever they can be best at that people will pay for it. That may seem obvious, but publishers so far have largely tried to replace old advertising and subscription revenue with increased charges for diminished content. I like to compare that to switching your high-end chocolate chip cookie ingredients to milk instead of bittersweet chips, mystery fat instead of butter and while you’re at it, making them smaller. Oh, and raise the price. Think. Think. Think. Why would fewer people be buying your cookies?

Those who continue to fantasize that they can charge everyone for any crap they publish might think of The Guardian’s editor, Alan Rusbridger. As part of a recent talk, he included, “It would be crazy if we were to all jump behind a pay wall and imagine that would solve things.” He is looking at many financial models, including some version of limited paywalls, but he does not seem to delude himself.

(Tip of the toupee to the FT’s John Gapper for the source of that quote.)

Cross-post: This appears at Harrumph!

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