Whether it’s the Seattle Post-Intelligencer giving up the printed ghost and going all-digital or the Rocky Mountain News going out of business, the world of journalism has been in a constant state of flux lately. As media giants such as News Corp. CEO Rupert Murdoch reconsider the possibility of making users pay for content, there are emerging solution providers, such as Journalism Online, LLC, that hope to make the task of monetizing content easier for content providers and consumers alike. In the meantime, discussions about the future of online journalism continue to intensify, and the industry is frantic to find solutions.
During a conference call announcing a 47% slide in quarterly profits, Murdoch said, “We are now in the midst of an epochal debate over the value of content and it is clear to many newspapers that the current model is malfunctioning.” News Corp. owns The Wall Street Journal, one of the few papers to successfully charge for content online. “We have been at the forefront of that debate and you can confidently presume that we are leading the way in finding a model that maximizes revenues in return for our shareholders. … The current days of the internet will soon be over,” he continued.
During a recent Fox Business Network interview, Murdoch also blamed high rates of debt for the predicament newspapers are finding themselves in. He said, “There have been
a lot of newspaper deals done in the last 10 years in which people have taken on ridiculous debt. If you look at the Tribune Company, their big papers—the L.A. Times, Chicago Tribune—I bet you they’re still making money individually. But they can’t pay their interest bills.”
“With the decline in online advertising, news publishers around the world realize that they need multiple revenue streams. They are now very focused on generating online subscription revenues,” says Journalism Online co-founder Gordon Crovitz. The group—formed by journalism and media industry executives Steven Brill and Leo Hindery along with Crovitz—hopes to “help news publishers and their readers by providing several services to make the transition to more paid access for news as easy as possible,” according to Crovitz.
Some critics say that this has all been tried before. Crovitz is convinced times have changed. “Unlike the situation many years ago … people now are very accustomed to paying to access content and services online, from music via iTunes, to ringtones, to information. As importantly, news publishers now realize that some minority of their unique users, perhaps about 10% for most news publishers, will be happy to pay to access the full experience with their favorite news brands,” he says.
While The Wall Street Journal seems to have had success with charging for its content, not everyone is convinced this model will work for papers such as Murdoch’s own New York Post. “People have repeatedly pointed to The Wall Street Journal as the exception,” says Terry Steichen, editor and publisher of Topic Central, who has been following the evolution of online journalism for years. “I don’t know that the decisions of The Wall Street Journal and the financial news business would necessarily translate into anything in the general news category.”
The highly specialized financial news of The Wall Street Journal is a different animal than the daily news. “Clearly newspaper publishers are worried about the limits of future revenue streams available to them. At the same time they realize that search engines and aggregators and blogs are making a lot of money off their free content and that not enough value in the form of increased traffic is being returned to them,” says Steichen.
Journalism Online hopes to provide the tools to make the transition as painless as possible. Among those tools is a website set for launch sometime in the fall where consumers will be able to purchase subscriptions, day passes, and single articles from multiple publishers using a single login. Another initiative will be to negotiate wholesale licensing and royalty fees with intermediaries, such as search engines and other websites that largely base their business models on referrals of readers to original content on news websites.
Whether or not Journalism Online is the answer to the media industry’s prayers, it’s clear that something has to change. As Crovitz puts it, “Technology now empowers people … to get access to information in many new ways, but the right information at the right time delivered in the right context has more value than ever before.” Publishers around the globe are hoping that readers agree.