In case you haven't heard, there's a rumour going round that the print media is dying. Basically, print is slow, and Twitter et al. are faster. The prevalence of digital media has resulted in fewer print readers, which has resulted in declining advertising revenue. Or so the argument goes.
News outlets must monetise their content - that much is clear. They are businesses like any other and their employees presumably want to keep their jobs. But the unfortunate fact remains that papers are haemorrhaging money at an unsettling rate.
So what's the solution to the financial difficulties that many news organisations now find themselves in? I don't believe it lies in selling early access to stories, as Reuters blogger Felix Salmon has suggested. News organisations such as Reuters, Bloomberg and The Wall Street Journal already charge a handful of select clients, mainly hedge funds, for access to their investigations before they are released to the general public.
The advantage that this pre-release news has to traders is evidenced by the vast sums they are willing to pay for the service. But it isn't just hedge funds and investment institutions that are lining the pockets of such news organisations. I recently worked at a London based financial newspaper which, probably because it wants to try to minimise staffing costs, also subscribes to the Reuters Wire, saving itself an awful lot of ground work at the same time.
Though this works as a business model and funds some genuinely excellent journalism, I think that if it became the practise of your average daily then this would threaten the integrity of the industry as a whole. I've heard it said that the average newspaper reader doesn't value big investigations, so they should just be sold to those who do. But investigations are not valuable simply because they can be turned to a profit. The job of the news media is to make the 'average reader' sit up and take note, surely.
More to the point, if the news is to continue its transition to online and mobile formats, doesn't it make sense to look at ways to make money from the digital arena? Papers should embrace the move to digital instead of trying to fight it, finding creative ways to monetise online content as they go.
The New York Times Company, publisher of The New York Times and International Herald Tribune, was one of the first print media companies that attempted to do just that, and did so with some success. As of the end of 2011, the Times Company had 406,000 paying subscribers to its digital products, representing a significant and growing source of income.
Yet the revenue generating potential of a paywall will always be limited. It's a start, but unless you as a consumer have some pretty specific needs, you can always go somewhere else for your news, curated and aggregated as it is by so many different sources. Overall revenues at the Times Company still dropped five per cent because, surprisingly, both print and digital advertising income fell. More surprisingly, just in the last quarter of 2011 digital advertising revenues dipped nearly three per cent at the company.
According to Raju Narisetti, a digital leader who has worked at both the WSJ and the Washington Post, "one mistake people have made - with the exception of people like the WSJ - is the idea that if you grow audiences and grow enough critical mass of audience that the advertising will come and the revenue will grow proportionally". Clearly this hasn't happened.
Fortunately, there are other ways to monetise news content out there. The key is to be active. In a competitive online environment, individual newspapers have to force people to their websites. The Guardian, for instance, has said that only two months after its immersion of stories within Facebook, it saw page views of its website increase by more than one million hits a month. It has also taken advantage of its reputation to cash in on hosting 'masterclasses' on everything from creative writing and journalism to photography and art, charging up to £400 for the privilege of attendance. I see no reason why other papers could not follow suit.
A similarly simple way to generate revenue could be to 'unbundle' content more. Just as the music industry separated singles from albums to increase demand, newspapers could offer individual investigations, reports, and features for a heavily discounted price to attract greater consumer interest. The apps and e-books markets also hold a hope for monetising online content, as part of what should be a greater push to 'personalise' news and integrate it across platforms.
What's for certain is that the answer to funding gaps at papers has to be a digital one. There's a reason journalism students at City University London, prestigious for its masters courses, must live tweet questions in lectures instead of raising their hands. It's because social media isn't just a forum for banality; it's a space where people all over the world read and engage with breaking news. If newspapers and news organisations more generally fail to adapt to this fact, they will not last, end of story.
Obviously, the solutions for all outputs may not be identical, and some business models may stay largely unchanged without dire consequences. For example, circulation of Private Eye in the later half of last year was its highest since 1986. Ian Hislop, editor, is adamant that his magazine won't be part the "rip-off" of free journalism and Eye's online presence remains negligible compared to its print format.
However the industry decides to package its content in the future,the principles of journalistic integrity and professionalism should not be abandoned. A reputation for honesty and quality may well save some well established names in the news media from the challenge of their more amateur competitors.
According to Steve Rubel of PR firm Edelman, author of the Clip Report, a blog on the future of the media, quality content is now abundant. But, equally, the notion of trusted content will increase in importance as the digital media market becomes ever more saturated. The internet, unfortunately, has the tendency to propagate misinformation and inaccuracy, since most bloggers don't have the resources (or sometimes skill) to mount reputable, to point fact checks. Accusations against Lord McAlpine made on the internet after an ambiguous Newsnight broadcast are a case in point.
Of course I am loathed to say that companies should charge for news. It may end up discouraging people from becoming informed in favour of apathy. But if some news organisations go under, so will many trained, experienced and specialised journalists. This would only serve to decrease the quality of publicly available journalism. Worthwhile investigations cost money, and so does professionalism.
With that in mind, media companies may have let the genie out of the bottle when they began freely distributing digital content. Finding ways to put him back again is the principle challenge for the news media in the next decade. The early decision made by most news outlets not to charge for their online content could turn out to be an irreversible error in judgment but at the end of the day, if you want proper journalism, you're probably going to have to pay for it.
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