ABC - Audit Bureau of Circulation - independent body which provides circulation figures of newspapers and magazines for advertisers
ABCE - Audit Bureau of Circulation Electronic - for electronic versions of above
Active audience - An audience who interact with the media product
Conglomorate - Large industrial corporation, usually involved in several different industries
Consumers - Term for media audiences which emphasises the commercial aspects of distribution and exhibition, thus production and CONSUMPTION of media texts
Convergence - Describes the comming together of previously seperate industries (computing, printing, film, audio etc which increasingly use the same or related technology and skilled workers.
Technological convergence - Describes the coming together of previously seperate technologies (computing, printing, video, film, telecomms etc)
Deregulation - The removal of government restrictions on media industries
Digital - Based on numerical information, distinguished from analogue
Distribution - How the product gets to the audience. Traditional vs digital. Distribution of online papers is via the Internet but it also available on different platforms i.e. mobile phone, text alerts, email. This is MULTI-PLATFORM distribution.
Globalisation - A process in which activities are organised on a global scale
Ideology - Shared ideas and values and how these ideas are related to the distribution of power in society. Media have a role in reinforcing or challenging the dominant ideology.
Institution - Used in media studies to refer to the social, cultural and political structures within which media production and consumption are constrained
Internet - The global 'network of networks' offering a range of services governed by different protocols, such as the World Wide Web, email etc
Liberalisation - the loosening of controls over media markets by governments
Market - The total of all the potential sellers and buyers for a particular product (and the number of products likely to be exchanged)
Marketing - The process of presenting a product to its target audience, the ways in which its positioned in its particular market
Mode of address - The way a text speaks to its audience
Moral panics - A sudden increase in concern about the possible 'effects' of media products
Multi-media - Referring to several traditionally seperate media being used together, e.g. sound, image and text on computers
Multi-platform - This can be interpreted as Multi-platform in terms of the convergence of different platforms i.e video, radio and telecomms and/or in terms of being distributed via different platforms i.e. Internet, mobile phone apps (API), podcasts, email, RSS feeds etc. Please try and distinguish which you are being asked to write about, if you can't then introduce explaining the there are two ways of understanding the term.
News agencies - Organisations which gather news stories and sell them to broadcasters and newspaper publishers
Niche Marketing - The idea that there are very small, but highly profitable markets which could support specialist advertising-led media products
NRS - National Readership Survey is teh organisation supplying information on UK readership of national papers and magazines
OFCOM - Regulator for the UK broadcasting and telecommunications industries
Passive Audience - An audience who do not/cannot interact with the media product
Production Practices - How is the product produced? Discuss new Guardian offices for example and the technology they have invested in to produce the multi-media, multi-platform guardian.co.uk
Public Relations (PR) Professional services promoting products by arranging opportunities for exposure in the media
Quality Press - The 'serious' newspapers - in the UK synonymous with broadsheet. Audience have a strong interest in politics and current affairs
Segment - To divide up a target audience into even more specialised groups which can be addressed by advertisers
Synergy - The combined marketing of products across different media and other products (in music, toys, Internet, and TV programmes, T-shirts, Theme Park rides and so on) which are often owned by the same corporation, such that the total effect is greater than the sum of the different parts
Technophobes - People who are afraid of new technology
Virtual - Something which is a representation rather than the real thing. 'Virtual Reality'
World Wide Web (WWW) The network of 'pages' of images, texts and sounds on the Internet which can be viewed using browswer software.
Mail Online: up nearly 75% year on year, and with monthly growth of more than 5%
Mail Online remained the most visited UK newspaper website in April, according to the latest figures from the Audit Bureau of Circulations Electronic published today.
Associated Newspapers' website network had just over 2.3 million average daily browsers during April, a 5.33% month on month and 74.5% year on year increase. Mail Online also became the first UK newspaper website to top 40 million monthly uniques in April.
Guardian.co.uk was again the second most popular national newspaper website, with just over 1.8 million average daily browsers, and Telegraph.co.uk third, with just under 1.6 million.
National newspaper websites now use an average of daily visitor numbers as their headline measurement figure as it is felt to be more representative than a monthly user figure.
Newspapers struggled with print revenues and circulations in 2010 but continued to set the news agenda. Photograph: Sang Tan
Printed newspapers may be going out of fashion but the national titles were at the forefront of setting the news agenda throughout the year. Yet they often relied on online disclosures by WikiLeaks. Three of the year's major stories – the Afghan and Iraq war logs, and the embassy cables – were the result of the leaked data put up on the net. This not only provided rich material, it enabled them to fill endless pages with comment about the ethics of publishing it. Newspapers do like to have their cake and eat it.
It was also noticeable that the election's transformative moment came courtesy of a TV debate in which Nick Clegg emerged as a political contender. However, it was newspapers' response that boosted Nick Clegg's public image. There is little doubt papers still carry considerable clout despite falling sales.
Indeed, with audiences building online, they arguably have more influence than ever before. That's the positive side. The negative is that print revenue fell further, leading to reductions in editorial budgets. The question asked continually was how to fund quality journalism. Some owners and editors showed a touching faith in apps' game-changing possibilities. Among them was Rupert Murdoch, who also boldly dared to go where no publisher had dared to go before by introducing charges for access to his papers' websites. Paywalls have since been the year's hottest topic within the industry.
By contrast, the Independent – having acquired a new owner, Alexander Lebedev – launched a cheap sister title, i. He also showed that another funding model, going free, could work with the London Evening Standard. But the overall picture for print has been anything but bright. Circulations continued to slip away, especially from the daily regional titles, and there were more closures of weeklies. But predictions of complete meltdown did not come to pass.
The Guardian Media Group resigned from regional publishing altogether, departing from its historic Manchester base to sell out to Trinity Mirror. There were further indications that the Daily Mail and General Trust is also eager to dispose of its regional division, Northcliffe., having held talks with Trinity. The other two major regional publishers, Johnston Press and Newsquest, faced increasing journalistic opposition to their costcutting strategies. Further consolidation can be expected. But all eyes will be on the Murdoch paywall results.
Prepare bullet points under each of the following headings to be ready for just about any question in the exam. All bullet points should refer to the Guardian with notes on the rest of the industry where relevant.
PRODUCTION PRACTICES (Traditional and New Media)
MARKETING (AUDIENCE TARGETING) and SYNERGY - By which methods do the Guardian advertise their product? Do they own any of these companies? Who do the Guardian work with in a mutually beneficial arrangement? Twitter? Apple?
DISTRIBUTION METHODS (Traditional and New Media) New media distribution is MULTI-PLATFORM i.e. it is distributed via the internet and available on the paper's website via a PC or a Mac but is is also distributed via the iPhone App, RSS feeds, text alerts, email, Twitter and Facebook. - this is not even a complete list!
EXCHANGE - what is the point of exchange?
PATTERNS OF AUDIENCE CONSUMPTION - (Who are the audience, circulation figures, unique users, how and why do they consume?)
CONVERGENCE/MULTI-MEDIA
INTERACTIVITY - What does the Guardian offer on different levels?
If you get a question on PRODUCTION and DISTRIBUTION you will be assessed on your ability to illustrate patterns of production, distribution, exchange and consumption through relevant case study examples and your own experiences as audiences.
You should cover the following material in your response to the question: • Production practices which allow texts to be constructed for specific audiences • Distribution and marketing strategies to raise audience awareness of specific products or types of products • The use of new technology to facilitate more accurate targeting of specific audiences • Audience strategies in facilitating or challenging institutional practices
All the info you need to prepare paragraphs on each of these is on the blog. Ensure you understand what is meant by PRODUCTION PRACTICES, DISTRIBUTION METHODS AND MARKETING STRATEGIES, EXCHANGE, CONSUMPTION
The only info available at this time is from the Jan 09 exam and you can find all the info at: http://www.ocr.org.uk/qualifications/type/gce/amlw/media_studies/documents/index.aspx - we've looked at this site before you'll recall.
Hopefully you might be able to shortcut the search by using these links:
Question Paper for Jan 09 http://www.ocr.org.uk/download/pp_09_jan/ocr_34833_pp_09_jan_gce_g322_01.pdf
Mark scheme for Jan 09 http://www.ocr.org.uk/download/ms_09/ocr_35065_ms_09_gce_jan.pdf
The question is always different but at least you have some idea of expectations here. We will of course cover all of this in revision but it may help your essay for Monday.
With reference to your chosen case study consider how important interactivity is to media institutions? Case Study: Newspaper Industry (The Guardian) Audience demand for interactivity could be considered as the main driving force behind the development of new media and if the audience demand it then the industries need to deliver. The newspaper industry is struggling because the circulation figures are falling and with that the revenue that comes from advertising. Newspapers could not be considered interactive in the printed form because consumption of the newspaper is passive. However, if the online version of the paper is visited the experience becomes ‘active’ because the visitor is now in control of her consumption and can choose what to look at/watch/listen to, can download files and podcasts, share articles with friends and contribute to a discussion using one of the numerous ‘talkboards’. Online newspaper ‘Users’ now have a wide range of choices available to them for where they get their news and it seems the only way to keep them coming back is to make them feel part of a community, a difficult task for a national paper. If a successful community is necessary to keep their ‘unique user’ count up then interactivity at a combination of levels is crucial to the success of the paper.
Read the article 'The future of News is Scarcity' (on this blog) for inspiration. Some ideas for development of points: Who are the audience for the Guardian? Are they already a community because they share an ideology? The Guardian were the first to use blogging technology - What do the Guardian offer by way of an 'online community' now? How busy is the community? What threats do the community face? The Guardian News and Media division is losing money and staff but they are adamant that they won't move to paid for content. Also comment on the Guardian's decision to launch an iPod app for the Guardian yet leave out access to read/post user comments - good idea? Are the Guardian making any moves to leverage their standing in the 'community' to bring in additional revenues as the author of the above article suggests? Their newest acquisition is actually a digital publishing and events company in the US called ContentNext - they seem to be seeking a global audience and community for their product.
You must first understand what 'interactivity' means. It's a slippery term taken to mean different things for example an online newspaper can be interactive because the audience can control what they see and hear by chosing the links or searching for specific stories. It is also interactive because a newspaper visitor can communicate with the producer of the newspaper blog/podcast/video footage and also debate topics with other visitors. The highest level of control would allow the visitor to be a contributor to the paper by submitting their own news packages for audience consumption. Sally McMillan states that interactivity can occur at many different levels and degrees of engagement and that it is important to differentiate between these levels. ‘If ‘interactivity’ is to move beyond its current status as a widely used but poorly conceptualized term, we must recognize that there are three fundamentally different types of interactivity. Scholars and others who use the term should indicate whether they are focusing on user-to-user, user-to-documents, or user-to-system interactivity or some combination of the three. ‘
McMillan, S.J. (2002). "Exploring Models of Interactivity from Multiple Research Traditions: Users, Documents, And Systems". in Lievrouw, L.; Livingston, S.. Handbook of New Media. London: Sage. pp. 162-182.
To what extent is a multi-platform publication beneficial to media institutions and audiences?
These are currently very exciting times for audiences of multi-platform journalism but the newspaper industry is in crisis as they are slow to change their business model and are struggling to make a profit. The most obvious benefit for audiences is that online content is free and they have access to a wide range of media to satifsy their need for news and a sense of community. They not only have the stories and comment – they also have video, podcasts, blogs and forums so there’s a whole new interactive experience. The most obvious benefit for the newspaper is they now have reduced distribution costs and the audience for online content is global. However, an industry which was once funded by advertising has not been able to transfer this business model to the web and this loss in advertising revenue due both to the recession and the death of the classifieds, is being blamed for the demise of the newspaper industry. Some argue that there are no benefits for either party because the true cost of multi-platform journalism is the huge numbers of editorial staff losing their jobs in cost-cutting exercises. This raises the issue of ‘quality’ as more and more content is either user-generated or from PR material.
Have a go at completing this essay or answering another question using the same formula.
Your Homework is to choose one of the questions below and write an essay as revision and practice in structuring an answer to a question. The information on this blog will get you started and you are expected to carry out further research to build your personal case study. Reference all sources. Submit as a printed Word document at the beginning of your next Media Lesson.
Last Year's Question: How important is technological convergence for institutions and audiences?
A sample paper and mark scheme is available to support your writing:
Question Paper for Jan 09 http://www.ocr.org.uk/download/pp_09_jan/ocr_34833_pp_09_jan_gce_g322_01.pdf
Mark scheme for Jan 09 http://www.ocr.org.uk/download/ms_09/ocr_35065_ms_09_gce_jan.pdf Here are some other example questions from the Long Road Media site to help you prepare for the exam:
1) To what extent is multi-platform publication beneficial to media institutions and audiences?
2) With reference to your chosen case study consider how important interactivity is to media institutions?
3) What has the impact of increased connectivity been on the media production, distribution and exhange process?
Remember that the mark scheme explicitly rewards discussion of your own experience. This section is the ideal place to put in some well-researched data to back up your case study of The Guardian.
What are your own experiences of newspapers and where do you go for news? You may think it’s not relevant but IT IS! You are the next generation of potential readers so the habits you are forming now will matter to the industry.
You’ve used free online survey websites such as www.surveymonkey.com, so you know how easy it is to gather questionnaire results for a coursework project without the hassle of distributing wads of photocopies. Try conducting a survey of the newspaper reading habits with friends and family so you’ll be able to compare your own experience of newspapers with those of others. Are there any trends or patterns? Any surprises? How do your survey results reflect the national picture of newspaper readership?
·In November 2010 the National Daily Newspaper circulation for the Guardian was 270,582 (down 13.1% from previous year)
·The circulation for the Sun was 2,898,113 (down 2.96% from previous year)
·Mail online remained the most visited UK newspaper website in April, according to the latest figures from the audit bureau of circulations electronic published today.
Online Newspaper and community:
·Guardian.co.uk was again the second most popular national newspaper website, with just over 1.8 million average daily browsers, and telegraph.co.uk third, with just under 1.6 million.
·National newspaper websites now use an average of daily visitor numbers as their headline measurement figure as it is felt to be more representative than a monthly user figure.
This picture is complicated further, however, as the number of copies sold doesn’t necessarily equal the number of readers: many people share their copy of a printed newspaper so the readership and/or circulation figures can only ever be a rough guide. They are vital to the industry of course, because a newspaper which reaches a larger audience can charge more for its advertising space, and newspapers make more money from advertising than anything else. The cover price in most cases will not cover the cost of production
We have already seen how software is being used to market The Guardian’s content through APIs, and the ways the printed newspaper acts as an advert for online services. But The Guardian also uses other traditional media to advertise its newspaper and website, including some innovative TV adverts. In common with other national newspapers, it also offers discounted subscription schemes and often runs promotions to give the newspaper away to university students as a way of encouraging a lifelong Guardian habit. Free copies are a great incentive, and cutting across issues of distribution, exchange and audience consumption, is the issue of ‘bulks’. These are large orders of heavily discounted copies of the printed paper, typically sold to airlines and hotels to be given away to their customers. This year has seen The Guardian break with another tradition in this respect, as it announced it would become the first national quality daily to scrap distribution of all its bulks. MediaWeek reported that Guardian News and Media claimed the move would ‘increase transparency across the newspaper industry’ – the implication being that its rivals inflate their circulation figures through the use of bulk orders. We might wonder whether the move to scrap bulks was linked with the industrial action and redundancies at The Guardian Print Centre; though as the MediaWeek article pointed out, bulks represent a much smaller percentage of total circulation for The Guardian than for many of its rivals.
Identifying the precise point of ‘exchange’ between publisher and reader is interesting in the case of newspapers as they run parallel online and printed content. An online reader might have seen a headline on the website encouraging them to buy the print edition, or have been encouraged to go online by an advert seen in the print version. And with subscription models to consider, how might exchange be usefully understood? For example, an online reader might be sent email content or be paying for access to subscription only content, even when they neglect to check their emails or use the site. Of course, buying a printed newspaper doesn’t necessarily mean you’ll read it either, so any discussion of ‘exchange’ must be complicated as we distinguish between the physical product and its content. The transaction between publisher and consumer, of this product and its content is further complicated when we look again at the issue of APIs and their role in distributing content through other media.
How is The Guardian’s news ‘distributed’? The printed version, once it has been printed at one of the two Guardian Print Centres (London and Manchester) is delivered to UK wholesalers by TNT Newsfast/Network Logistics. The Guardian is also printed internationally, in some countries using OCE’s DNN service. For example: under the current deal The Guardian is able to print 600 copies per day in Sydney and have the copies on sale down under before their readers in Europe have even woken up.
MULTI-PLATFORM DISTRIBUTION The website is ‘distributed’ via the internet, of course, but the content of The Guardian’s website is not only found by visiting www.guardian.co.uk through a web browser. RSS feeds, email headlines and mobile phone services all allow Guardian readers to stay up to date. And recently a major new feature has been added, as The Guardian has released its ‘Open Platform’, a set of software developer tools which was launched with a content API (Application Programming Interface). What this means is that web developers can integrate Guardian content seamlessly into their clients’ websites, whilst The Guardian controls the adverts which are associated with the free content it provides.As Guardian director of digital content Emily Bell puts it, this will allow Guardian content to be ‘woven into the fabric of the internet’.
The impact of the recession Finding up-to-date figures for the total number of journalists and editors employed by The Guardian is difficult, though a recent report suggested that this year the editorial staff at Guardian News and Media is shrinking from around 850 to 800 through redundancies. One fear consistently voiced by commentators on the newspaper industry is that the quality of journalism will suffer as production costs are cut and reader-generated content becomes more popular. The rise of citizen journalism has been well documented elsewhere but we can’t ignore their impact on The Guardian and the ambivalent relationship which must now exist between professional journalists and accidental eyewitness reporters. A key story one might explore in this respect is The Guardian’s campaigning investigative coverage of 2009’s G20 protests in London and the death of Ian Tomlinson.
The quality of news produced by Guardian journalists has been examined in Nick Davies’ Flat Earth News. He employed specialist researchers from Cardiff University to analyse stories printed in The Guardian and three other national dailies during two one-week periods. The result? A staggering 60% of these quality-print stories consisted wholly or mainly of wire copy and/or PR material. In other words, press releases or unchecked stories from agency journalists were forming the bulk of the domestic ‘news’ in print. Of the four papers analysed, The Guardian had the lowest percentage, but it was still more than 50%.9 Davies refers to this ‘copy and paste’ reporting style as churnalism. Is there any wonder that many readers would trust Joe or Joanna Public’s account of an event, over a ‘report’ filed by an overworked and underpaid ‘churnalist’? READ THIS: Guardian News & Media to cut more than 100 jobsNewspaper group says revenues have fallen by a worse-than-anticipated £33m http://www.guardian.co.uk/media/2009/nov/11/guardian-news-and-media
WATCH THIS: Sustainability in advertising: Alan Rusbridger GNM's editor-in-chief on the contradictions of advertising-funded journalism and the power of editorial
In terms of innovation, The Guardian has been groundbreaking in many respects. It was the first UK national newspaper to use blogging software, the first to produce podcasts, and, perhaps more radically, the first British newspaper to produce web-first stories (i.e. on the web before being seen in print). It has a reputation for enthusiastically adopting new technologies, As production of The Guardian website and print versions is seamlessly integrated, it becomes difficult to establish where production of one ends and the other begins. And given the wealth of extra content on the website, it is now hard not to see the website as being of primary importance and the print version as a brand-strengthening advert for online services. Paddison, Neil, The Real World of the Newspaper Industry: A case study of the online version of the Guardian, in MediaMag, December 2009
You need to research: When did The Guardian newspaper go online? When did they start using blogging software and how was this/is this used on their site? What type of podcasts are available and how are these used by the audience? How many people use the site compared to the number buying the papers? How is the production of The Guardian website and the print version 'seamlessly integrated?'
Revision starter: What is technological convergence? - examples referring to newspaper industry Who owns the Guardian Newspaper? How is the ownership of the Guardian different from that of the Sun and how does this impact their coverage of news? What is the circulation of the Sun and what is the circulation of the Guardian (2009)? How does the Guardian survive in the current climate of recession and falling newspaper sales?
The production process The Guardian’s headquarters is in the brand new Kings Place building in Kings Cross, London. Kings Place is also home to two orchestras including the London Sinfonietta, as well as housing a concert hall and two art galleries. But music aficionados will not be disturbed by the thunder of nearby printing presses, as The Guardian Print Centre is seven miles away, in Stratford. For a short but fascinating look inside the print centre, check out YouTube. http://www.youtube.com/watch?v=degZQJlk5m0
Incidentally, recent redundancies at the print centre made headlines as industrial action was narrowly averted, showing us that the downturn in the newspaper industry is having a serious effect upon The Guardian. Kings Place has been home to The Guardian since December 2008, and such a recent move means that The Guardian now has an office space ideally suited to the new media environment. Editor Alan Rusbridger, writing at the time of the move, gave an insight into the changes it had brought:
‘Print and digital operations are largely integrated, where previously they were physically separate.”
He also pointed out that as well as regular desks with computers ‘there are seven state-ofthe- art recording studios and 24 editing desks.’ The Guardian is an online provider of news for a global audience and their new headquarters reflect a new convergence of technology as stories are written simultaneously for print and the website. Podcasts and video reports are also produced for broadcast, and live feed coverage of key events is now common. The way the agenda is set is changing too: morning news conferences can be attended via videoconferencing for Guardian employees not physically present at Kings Place.
Homework: Read pages 10 & 11 of the GMG Annual Report and summarise in bullet points.
Ownership and Profits We watched a short video on the Scott Trust www.gmgplc.co.uk - on the home page, top right.
We might expect newspapers to disappear following the growth of the internet. As so much information can be found for free, it begs the question: Why would anyone pay for a newspaper nowadays? The Guardian’s most celebrated editor, C. P. Scott, provided one possible answer:
“Comment is free, but facts are sacred… The voice of opponents no less than that of friends has a right to be heard.”
He was writing in 1921, celebrating the centenary of The Guardian and affirming its values as an independent newspaper. Let’s take a closer look at The Guardian. In 2009, it is celebrating 50 years since it changed its name from The Manchester Guardian to become The Guardian, and 10 years since The Guardian Unlimited network of websites was launched. It is the only UK national newspaper wholly owned by a trust, which means that there are no shareholders to satisfy, and profits are reinvested to secure the newspaper’s future.
Does The Guardian make a profit then? In short, no, but it’s more complicated than that. The Scott Trust owns a multimedia business, Guardian Media Group PLC (GMG PLC), whose portfolio includes national, regional and local newspapers, radio stations, magazines, a raft of websites and B2B media.’ Guardian News and Media (which publishes the Observer and Guardian, and produces The Guardian Unlimited website) is just one part of Guardian Media Group PLC, and it reported a loss of £36.8m for 2008/09. GMG PLC as a whole reported a loss before taxation of £89.8m.
But the bigger picture is important – last year the group enjoyed a profit of over £300m, and each year the figures are complicated by deals involving joint ventures, restructuring, and links with subsidiary companies. If reading a company’s annual report sounds off-putting, at least download and skim through GMG’s 2009 report – it’s surprisingly colourful, readable, and will give plenty of ideas for further research.
The Guardian might not have survived in its current form were it not for the fact that The Scott Trust draws profits from other titles such as Auto Trader, which it partly owns through the Trader Media Group. To be fair, the Trust was set up to ensure the survival of the newspaper by carefully investing its profits and that is exactly what it has done. So the editorial freedom continues even though the ‘profitability’ of the newspaper might be questioned. As the chair of GMG, Amelia Fawcett, puts it:
“While not immune to difficult market conditions, Guardian Media Group is able to place long-term security before short-term profit.”
Whilst the printed Guardian might not be ‘profitable’ by itself, Guardian Unlimited made a profit of £1m in 2006, its first year ‘in the black’ since it was launched in 1999 and after £20m of investment.
It is important to recognise that The Guardian’s status as a globally respected source of news is partly due to its history of independent ownership. But history aside, how important is the printed newspaper today, in relation to its online version? A closer look at production might help us to answer that question.
Paddison, Neil, The Real World of the Newspaper Industry: A case study of the online version of the Guardian, in MediaMag, December 2009
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.
Nic Brisbourne is a partner at European venture capital firm DFJ Esprit, investing in software and media. He was previously an associate with Reuters (NYSE: TRI) Venture Capital and an executive at Cazenove Private Equity. He blogs at The Equity Kicker...
News Corp (NYSE: NWS). and other traditional news businesses are hand-wringing over how they will make money on the internet. I think they are focusing on the wrong problem.
The web is more than just a new medium. Rather than thinking about how they can sell the same old news via a new channel, media bosses should be taking this opportunity to re-examine old assumptions, to rebuild their product for the 21st Century. The interesting thing about the news industry is that, when we examine it from the ground up, we quickly realise that it lost touch with its customers a long time ago, and that the model for the future will most likely look very different to what we are used to.
The great tragedy of the newspaper industry in the late 20th Century was that, in the pursuit of profit, quality journalism became a dying art. Budgets were reduced, journalists were asked to write more stories per day and were given less time to check facts. At the same time, editors were instructed to avoid stories that might create controversy and the expense of lawsuits. The result was more and more bland articles recycled from paper to paper, more politically motivated editing and the collapse of public trust in the newspaper industry. This story is chronicled in Flat Earth News by Nick Davies.
We kept buying, though, because we didn’t have any choice. The newspaper industry operated as an effective oligopoly and the value of the news itself was impossible to pick out from the bundle of hard copy distribution, advertising and content that we all purchased.
Fast forward to 2009 and the situation looks very different - all of a sudden, there is choice and the bundle has been picked apart. And, to make matters worse, the industry is possibly more exposed than any other to the trend towards $0 pricing for online content.
As Chris Anderson argues in his seminal book on this topic Free, The Future Of A Radical Price, the answer to this conundrum is not to swim against the tide and find a way to start charging for news, but, rather, to understand what is becoming commoditised and abundant, and what new scarcities are created as a result. In the book, Chris points out that, when he was young, food was scarce and the main problem of poverty was hunger, but now food has become so cheap and abundant that the biggest problem of poverty is obesity. The new scarcity is health, spawning huge industries in diet food and health services.
In the news industry, it is the news itself that has become abundant. Making a trip to the corner shop and buying a paper to find out what is happening in the world has shifted from being the only option to being the least good of a thousand options. I prefer to check Techmeme and Twitter, but there is the choice of thousands of other sites, aggregators and services that can deliver to your desktop or mobile. Moreover, there is no exclusivity in news per se – getting the headline from one place is pretty much equivalent to getting it from another.
The good news is that every abundance creates new scarcities and this is where the news industry must go to make money in the 21st century. The scarcities created (and enabled) by abundant news are interesting stories, thought provoking analysis, conversation and community, and trust/verification. Interesting stories go beyond simple reporting of what has occurred, bringing in relevant context and staying with a topic as it unfolds. Thought provoking analysis will dare to shock, and to be wrong. Conversation and community will both make the experience richer for the active participant and improve the quality of the content on the site for more casual reader. Trust and verification will make you go back to one site rather than another as you know the stories there will be more accurate (note breaking news should be published first and verified second, with appropriate caveats). The successful news company of the future will have to take all this on board and deliver it with a radically lower cost base than this industry is used to. In the digital world, the news industry, like many others, will be radically smaller. This contraction is partly a consequence of much reduced distribution costs, but is also a reflection of the fact that the monopoly rents Fleet Street enjoyed in the last century are a thing of the past. Witness how Craigslist has reduced the multi-billion dollar classifieds industry to nearer $100 million.Companies that follow the blueprint above are emerging already, most notably TechCrunch for technology news, Talking Points Memo, FiveThirtyEight and The Huffington Post for politics, PerezHilton for celebrity, and Pitchfork for music. These niche sites all write compelling content, spend time building up their sources, check their facts, encourage writers to find the real facts behind stories and are trusted by their readers. And, they all generate solid advertising revenues and benefit from relatively low cost bases.
Note that none of them charge for news. They do, however, have the option of leveraging their standing in the community to generate other revenues. TechCrunch runs the TC50 conference, Pitchfork organises the Pitchfork Music Conference and Perez Hilton charges for personal appearances. This is, I think, the real business model for news companies in the future - build a community around news and stories and maybe make a little in advertising, but the real money will come from leveraging the position in the community to offer services no-one else can.
