Thursday, July 16, 2009

The Coming Age of Paid News

?fh=dd71e0c771519c6269c9a68b63fe1c9fI haven't bought a real, physical newspaper in years. And yet I read online versions of newspapers aggregated through Google every day. And this Doonesbury cartoon does a pretty good job of encapsulating the results of an entire society doing the same thing. And certainly there is a lot of breast beating by journalists about the way that Google and Yahoo supposedly steal food from their mouths by posting links to their content. But the plight of newspapers is bigger than Google News, Google Reader, and bloggers posting links to their content. Linking to online newspaper articles drives readers to newspaper websites and generates at least some ad revenue. There is also an elephant in the room that the newspapers don't like to talk about when they talk about search engines and blogs linking to their content. Newspapers also make a lot of money off of classified ads. Or at least they used to. With Craigslist stealing the classified ad business which newspapers used to own, things start getting grim.

And forcing Google, Yahoo, or even bloggers to pay for linking to news websites sounds like a pretty good way for newspapers to cut off their nose to spite their face. (On a personal note, I actually had to look up that saying before I wrote it down, my original mangled version of that idiom was much more disturbing.) It doesn't bring back the classified ads revenue and it sets up a dynamic not unlike the one that currently exists with the music industry which is currently alienating an entire generation of its fans by suing people willy-nilly.

So what is the answer? At the moment there is none but there is certainly a lot of experimentation going around. Plenty of journalists have been pushed out of old media like newspapers, radio, and television and found a home on the web as bloggers. And some of the bigger blogging sites like Huffington Post and The Daily Beast are growing larger and have the resources to act more like traditional newspapers. (He writes having rarely if ever visited either website.) It's possible that big professional blogs will eventually replace traditional newspapers altogether. It's also entirely possible that in the future newspapers will go completely online and will rely on either contributions or on some sort of micro-payment system which is reasonable and convenient enough that people are actually willing to pay it. This is pretty much what is happening now with iTunes and the Amazon MP3 store. While most teens still won't pay for music, older people are perfectly willing to trade a few dollars for the convenience of being able to download music from one reliable place at a low price. Or maybe the future of news looks more like TV and radio, multiple shows and channels all supported by advertising. I just hope that they don't overdo it.

Moreover devices like Amazon's Kindle promise to open up a whole new market for bloggers as they allow people to carry thousands of books and subscribe to hundreds of newspapers (which are updated every day), all in a relatively compact device. Of course these days tiny laptops are almost as compact and software similar to that of the Kindle's can be programmed for them. But laptops are real computers and their software can be hacked to remove the DRM software which controls what can and cannot be loaded onto the Kindle. The Kindle by contrast is completely "safe" from such shenanigans. This is why I think that in the end the newspapers' problems are more about control than they are about money. A big newspaper like the New York Times could potentially save a lot of money right now if they just gave all of their subscribers a Kindle but they will likely resist the move lest a user hack their device to read for free. So instead everybody reads for free.

As a post-script to these meandering thoughts I'd like to point out that many of the bigger newspaper bankruptcies have happened in part because they were mismanaged into the ground. And we certainly don't reward financial mismanagement in this country. OK, so we do; but the newspapers aren't too big to fail. Maybe the newspapers (and the mainstream media in general) need to ask themselves if they deserve to survive at all. While they are good at reporting body counts for the was Iraq, they did piss poor job of considering arguments that might have kept out of that war. Similarly, they've proven very good at detailing gory details of our economic crisis but did little to warn us that it was coming. And those who tried to warn us were generally laughed at. (I realize that the last link was a to a clip from CNBC, a cable TV network but radio and newspapers were every bit the enthusiastic cheerleaders to our exuberant economy which crashed so embarrassingly with every talking head on TV telling us that we had no way of knowing what was coming.)

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