Since John Hartigan first publicly raised the idea of charging users for online news content back in July it’s been a topic that has received a lot of attention both in the traditional media and quite naturally online. A lot of commentary has simply dismissed the idea of people being willing to pay for content that they are used to receiving at no cost, and declared the whole concept as being doomed to failure. I suspect that this view is based on thinking that is limited by what people’s current expectations are, rather than a carefully examining the potential for the idea to work.
For starters, I don’t believe that News have any intention of placing all of their content behind a paywall, away from their audience and the traffic drivers like Google and Yahoo, as it would immediately lead to readers to abandon their service to competitors like the ABC, who will not be placing any cost barrier in front of their general news service. Many people have looked at this as the beginning and the end of the paywall discussion, but that is a simplistic view and undervalues the breadth of content that News has access to.
Another criticism that has been made of News’ plan is that the only examples of successful subscription online content are the Wall Street Journal and the Financial Times, both of which deliver industry specific content which their primary market will not hesitate to pay for. The argument is that most consumers are not so loyal to the masthead that they read and will therefore abandon News Limited properties in favour of other news services. Once again, I believe that discussions have over emphasised the importance of what I’d describe as ‘wire’ type news, the basics of what happened where, which may come from staff reporters or wire services like AP, and has not given full weight to the type of commentary and analysis pieces which attempt to frame events for the reader.
As an example of where this type of product has succeeded you need look no further than the Crikey newsletter. The Crikey daily email newsletter is effectively nothing but commentary and analysis, and it has established itself as a permanent fixture in the Australian media landscape. To suggest that News Limited does not have the capability to create not just one, but a range of niche products, carefully targeting different markets that are willing to pay for the content that they want, is to severely underestimate this media powerhouse.
One of the most obvious areas where News excels is in its sporting coverage. The Daily Telegraph and the Herald Sun are without doubt the authoritative sporting media in their respective cities, providing content to a sports loving audience, many of whom are already used to paying for access via a Foxtel or Austar subscription. I believe that these fans will be one of the first markets that News tries to use in its online subscription model. Sure you’ll be able to get the AFL scores for free, but if you want to read the expert opinions of your favourite reporters then you’ll need to pay. At this point I can imagine there are plenty of you rolling your eyes and thinking that you’ll never pay for that type of content, but that’s OK, it just means that you’re not the target market. However, if you look at the introduction of subscription TV, both in Australia and overseas, you will see that sport is one of the things that brings in the bulk of consumers, online media will be no different.
Another area where the News Limited tabloids also have a committed audience is their political commentary. Andrew Bolt, Piers Ackerman and Tim Blair provide an unashamedly right wing, often pro Liberal, anti-ALP, anti-green commentary on Australian and world politics. While the content of these authors is not to everyone’s taste they have substantial readerships who are very loyal. I believe that News Limited’s move to bring their employee Tim Blair’s blog in house was very much a part of their plan to solidify an audience who would be willing to pay for access to political commentary that they want to hear. The counter argument to this that I have heard is that people will simply drift to amateur bloggers who hold similar views to the afore mentioned commentators, but what I think that fails to take into account is the authority that these commentators bring with them because of their position within the traditional media. People will pay to access content that reinforces their world view, so long as it has a level of authority that they are comfortable with.
The discussion thus far hasn’t even begun to address the additional content that News would be able to offer behind its paywall. Once News has identified the markets which will pay for content they can increase the value proposition with additional video and audio streams and by simply broadening the offering in those particular markets. To think that News would simply keep providing the type of content that they do now is, in my opinion, underestimating the entire organisation.
At this point I’d like to quickly mention Fairfax. Sadly for the publisher of the Sydney Morning Herald and The Age I don’t think that their transition to paid content will be as successful as News Limited. The reason for this is that I think that Fairfax’s audience will be much more willing to transition to the ABC than News Limited’s would. While Fairfax has lots of excellent contributors I don’t believe that they have the breadth that News does in sport coverage, and I certainly don’t believe that their political writers have the same loyal following that those I mentioned earlier from News do. With the emerging news that Annabel Crabb, one of Fairfax’s most popular political writers, is moving to the ABC I think that Fairfax needs to come up with something very special to tempt their audience. I suspect that the people at Fairfax believe this too and we will see them try to leverage the personalities from their radio network as a part of their online offerings.
While I am confident that we will become accustomed to subscribing to online content I am sure that the transition period will be difficult. I am also very sure that by the time the online shake up has finished the newspaper industry will be very different to what we know today.