By Steve Busfield: Bloggers, the Twitterati and web users everywhere are united: Rupert Murdoch, and now his sidekick James Harding, are just plain wrong about charging for web content.
On the back of months of Murdoch mood music, Times editor Harding today outlined the reader philosophy and some of the specific thinking about how News International will generate revenue from its web readers.
Harding says that News International will “rewrite the economics of newspapers” and contrasted the Times‘s 20 million-plus unique users with the 500,000 readers who had developed a “genuine digital newspaper habit”:
“We created a culture of free, and we absolutely were party to that ... In the last few years, we have talked with great pride – we believed advertising would sustain us – about unique users ... These people were window shopping down Oxford Street – they were not coming into our shops ... Historically, newspapers have treated their best customers worst and their worst customers best… We give the paper [content] away to people who could not care less and we pay little or no attention to people who love it and read it every day.”
New media thinker (and a fellow Guardian columnist) Jeff Jarvis found some easy ripostes to this argument (nice and short via Twitter):
“Times says papers ‘treated their best customers worst & their worst customers best.’ So now they’ll tax the best customers?”
“Times vows to ‘rewrite the economics of the newspaper.’ Well, sir, the web already did that.”
Well, yes, Jarvis is right that the web had rewritten newspaper economics. And a brief perusal of the media landscape shows the carnage it has wrought.
My Guardian bosses are also adamant that the Murdochs are barking up the wrong tree. Director of digital content Emily Bell said recently:
“We are not contemplating a paywall, nor as far as I’m concerned would we ever … they are a stupid idea in that they restrict audiences for largely replicable content. Murdoch no doubt will find this out – even rudimentary maths suggests he will struggle with a completely free model to meet advertising revenue levels across the NI offerings. Our strategy is entirely around reach and audience engagement – both if which would be irreparably damaged by paywalls.”
The long buildup to the News Corp (NYSE: NWS) move suggests that they are trying to find others who will join this paid-for-content crusade.
Harding today outlined how News Corporation might do it:
“From spring of next year we will start charging for the digital edition of the Times. We’re working on the exact pricing model, but we’d charge for a day’s paper, for a 24-hour sign-up to the Times [online]. We’ll also establish a subscription price as well.”
News Corporation is basically basing its web strategy on its newspaper strategy: attempting to tie in readers long term. Watching newspaper circulation figures decline, the Times embarked on a subscription policy, offering regular readers the product on long-term deals. Now it hopes to expand this to the website. Other newspapers are following the print subscription policy, including the Guardian.
Clearly, if you want to reach a mass audience on the web you have to be free. The Guardian reaches 30 million people a month via the web. The Guardian newspaper sells one hundredth of that.
But one has to presume that the newspaper readers buy their print copy and spend at least half an hour a day reading a wide array of content. They are engaged, regular, paying. Web readers are valued too (otherwise you wouldn’t be reading this blog), but they are not paying the bills.
With the grim media industry outlook, declining circulations and ad revenues, it is no wonder that media organisations are looking for answers. There are many within the industry who are hoping that Murdoch is right.