Sunday, November 29, 2009...11:13 am

Should media sites ditch low-value readers? (Or boost the value of their content?)

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Steve Yelvington has a very interesting post here on the whole “is Murdoch an idiot for blocking visitors from Google?” question (he thinks not). Perhaps more interesting is the argument it generates in the comments, which manages to be both slightly vitriolic and also well-informed – an almost unheard of trick normally.
Whether the planned move by Murdoch to erect a pay wall around News Corp content makes sense depends really on what he’s actually trying to achieve.
Not many of us are actually willing to pay for online content, if this survey from paidContent:UK is to be believed. (Though I never really trust surveys that talk about what people say they’ll do. Surveys only count when they reveal what people actually do.)
But maybe, as Steve Yelvington suggests, Murdoch isn’t focused on paying for his publications with subscriber money. Instead, closing off his web sites to Google:

is nothing more than a negotiating ploy to try to squeeze some cash out of Google, which – thanks to zillions of website owners signing up for its opaque AdSense deals – has more cash than it knows what to do with.

Chatter that News Corp is cozying up to Microsoft and its Bing search project indicates that maybe this is all about getting more money from search, and is nothing much about readers after all. Who, let’s face it, haven’t had much to do with paying for newspapers forever, pretty much.
So, what, if anything, can we do to save the news media?
In another sector, Michael Castello on mistypedURL has written a really interesting post on how we could save the music industry in the age of the download and peer-to-peer data sharing.
Recognising that there is no marginal cost involved with producing an extra digital copy, he realises that its value as an object tends to zero. It’s difficult, in effect, to persuade consumers to pay for something they know cost nothing to produce.
Yes, I know the argument is that all the costs are upfront, in artist development and recording. But it doesn’t seem to hold water any more in practice.
In response, then, Michael Castello suggests two ways of monetising music.

  • Sell music, not copies
    That means connecting with fans and giving them a reason to buy more valuable merchandise – “things that have a personal value to the fan and thus are worth their money”. These include t-shirts, gig tickets and signed albums – up to the personal experience of meeting the band.
  • Taking what’s free, buying what’s valuable
    In essence, those free digital music copies are an endless promotional stream, pouring out across a potentially global market to create more fans to buy more valuable merchandise.

Does this make sense?
Apparently it does – but for the artists, not the record labels. According to the latest research on P2P in the music business, artists have generally been earning more over the past five years, though record company revenues have been falling.

Effects on music industry of P2P filesharing

Fascinating stuff. But is it of any relevance to the news media?
In some ways, I suspect, yes. These are not exactly analagous products. You don’t keep news stories on your iPod to read over and over again, for example. But the idea that fostering reader loyalty is vitally important seems to ring true.
Our individual bits of content are not what are worth money. It’s whether or not they can attract a loyal readership that matters.
Murdoch seems to believe that visitors from Google search are random and transient: they are not likely to become loyal. But maybe his problem is that his products aren’t doing enough to make casual visitors loyal ones.
There’s another implication. Newspapers used to collect a range of journalistic talent together in a package to sell to readers. Part of that package was the newspaper brand itself. And part of it was a few star reporters or columnists who readers sought out especially.
But perhaps this old model of newspapers has run its course too. Just as music acts are starting to find that they are better at earning money in the P2P age, so perhaps writers may have to find ways of monetising their work outside the old newspaper/media model.
It won’t be easy. I predict there will be a great hollowing out of media employment.
Those at the top may be able to make a good living at their trade. Those at the very bottom will be paid minimum wage – or less – to churn the vast information pool for content.
And those in the middle will probably have to find other work…

1 Comment

  • As far as journalism is concerned, I tend to believe that the people at “the top” have the most to lose from peer-to-peer and citizen journalism. People like Murdoch have made their fortunes essentially using news to sell pieces of paper – and now that news can be transmitted without paper, he’s got a lot less to sell.
    I think we’ll see a lot of changes in how journalism works:
    -Interested persons undertaking the investigation of specific issues simply as a hobby, and producing quality reporting.
    -Organizations striving to present clear information as part of their mission (environment, earmarks, etc.).
    -Newspapers focusing less on hype and more on local events and goings-on, returning to their roots as community publications.
    There’s going to be upheaval, of course, but I believe that good journalism will continue and that talented individuals will still be able to earn a living doing what they do best – they just might have to think more outside the box than they were expecting.

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