› 
Paying for Online News

Daniel Filan's picture

This week came with the announcement from Rupert Murdoch that they will soon begin charging for some online content on News Corporation websites, saying that “Quality journalism is not cheap and an industry that gives away its content is simply cannibalising its ability to produce good reporting”. Now, the question on many peoples’ lips is: Will it work? Will people really pay for news? I believe that the answer is no.

There are many who believe that, in fact, it will work. Steve Brill of Journalism Online, believes that “publishers, by offering a mix of paid and free content, can wring subscription revenue out of 5-10 percent of their existing monthly visitors while maintaining 88 percent of page views and 91 percent of ad revenue”.

PriceWaterhouseCoopers recently published a report stating that newspapers have no choice but to start charging for online content, and that they will move back into growth in the year 2012. David Wiadrowski, a media partner at PWC states that “… News, sports and weather and finance are three or four… niche markets that people I believe are prepared to pay for in an online environment”.

However, early indications of public willingness to pay for formerly free media are not at all promising. Comments on the news.com.au page announcing the decision indicated that people did not believe that News Corporation offered quality journalism, and that they would simply switch to another free news source. And why wouldn’t they? In a recession such as the one we are in, no one wants to pay more than they have to. If people want to pay for news, they will buy a newspaper. In the meantime, they can simply watch TV or go to any of the multitude of news sites that offer what they perceive to be the same quality of news and not pay a cent.

But that’s not all. It is even possible that readers could get exactly the same news free of charge. According to Peter Scheer of the Huffington Post, slightly reworded versions of articles are not covered by copyright laws, as they are a different expression of an idea, and copyright laws only apply to the expression. Thus, news.com.au could post up an article and require users to pay to see it, but a news aggregator could take the article, reword it and legally put it up on their site for free viewing.

Besides this, there are other ways to make money through internet publishing. Of course there is advertising, but surely some roads are unexplored. For example, classified ads used to be one of the biggest income generators in newspapers. Who says that this has to change? Another option lies in the archives: many news websites charge money for access to their archives, which one suspects more people would be willing to pay for. The bottom line is that newspapers’ websites certainly can’t make any money without readers, and charging them for formerly free content will cause them to leave en masse.

Will you pay? If not, can you think of better ways for newspapers to make money online? 

Daniel Filan is presently on work experience at Open Forum. He shares his home with six snakes; one of whom, Heptet, is pictured. Daniel is currently learning to speak Japanese and looks forward to travelling to Japan next month.

Comments

Pay for News

Daniel your article was right on.  At this point in time with ample TV news, news magazines, newspapers, radio, ect I can't see anyone paying for news on a blog or elxewhere on the internet.  Your article was well written and researched.  Keep up writing.

Responses from the Twitterverse

Hi Daniel

People have been talking about your blog on Twitter.

Mostly they agree with you, like this guy: 

@ThunderPig, True. The only circumstance I would support a paid news website is if it had ZERO ADVERTISING.

 

some things should be free

They say nothing in life comes without a price, but in this case charging for online content I would agree would be a largely unpopular move.

All journalism should be treated as quality intellect, and paying a small fee for archived information is probably passable, but I'd support Sally's posting from the guy on Twitter - if there is advertising, forget it.

Thanks for a great read!

it's great to see gen y is thinking about this stuff!

This is a really smart comment - and it's great to see you're thinking about these things. A couple of issues however need to be addressed. Firstly the challenge with web based content is that it isn't free - either to produce or to consume.

The cost of production is still covered by the websites - whether they're traditional providers or blogging sites, whereas the price of consumption is at this stage being paid to the computer manufacturers and internet service providers.

Previous generations thought little of buying a paper a couple of times a week and a magazine once a month - they'd reach into their pockets and fork out maybe $30 or $40 per month for the right to take a large amount of paper home and read maybe a 10th of the content - or up to a quarter if they were lucky.

Now they pay about the same (adjusted for inflation) to buy a computer and a mobile phone and connect both to the internet. They don't want to pay any more for the content because they've already paid - and besides at this stage they can get most of what they want for free.

All this is about to change for a number of reasons.

Firstly internet access through high-end mobile phones and netbooks will overtake from fixed line data access in the consumer space over the next decade - perhaps even within the next five years in the consumer space.

Consumers will pay less for the access device, in fact like mobile phones, netbooks are most likely to be offered through two and three year contracts.

Now comes the interesting bit - the challenge for the ISPs will be the content. A company like Telstra will only be able to convince you to go online if they can convince you that there is content there that you want to access. So stay tuned as the Telstra's and Optus' and iiNets of this world begin to cut content deals with the NEWS, Foxtels, Fairfaxes and Network tens.

You will be paying for content, and you will be paying for your netbook/mobile phone - but you won't notice either because it will all be bundled up in a monthly fee. The ISP's will buy the content and package it up with the hardware as is already happening with mobile phone providers and music companies.

Rest assured - you will pay Murdoch for content - but he's smart enough to make sure you don't notice when you do...

An interesting idea

I guess that would be the best way to make it happen. People might not knowingly pay for news, but it's better when they pay unknowingly. Your idea would probably be Murdoch's best chance.

true

....and probably just proves my earlier point, douglascomms and Daniel, that nothing in life is free, you pay for everything somehow!!

My skin is crawling

If there is one thing that makes me WANT to pay upfront for my news it is the idea that the alternative is to pay under the table for it.

In fact, I am almost at that point now. 

I don't own a TV, yet a few weeks ago I found myself knowing ridiculous amounts of trivia about Masterchef.  Who the contestants were, who they were sleeping with, what they were cooking, whether they cried. This barrage of unwanted knowledge came from a combination of reading the paper and listening to the new on the radio (along with chit chat).,

When the finale of a reality cooking show, in which the biggest controversy was someone  being told their sauce was lumpy, makes the front page of the Sydney Morning Herlad (and somewhere between page 2 & 5) for the week preceeding that we can be pretty sure somebody is paying for our news.

I'd rather pay myself than let Channel Ten pay on my behalf and wind up with tripe on my plate.