Will publishers rally to Google’s Newspass?

Matthew Buckland has a great guest post on Silicon Valley Watcher looking at Google’s Newspass payment system for publishers. (It’s cross-posted from memeburn.com)  Buckland compares the value proposition for users with Google’s system and the system that Rupert Murdoch has instituted at The Times. He likens Newspass to a cable television subscription in which a consumer makes a one off, predictable payment to receive a package of content each month. He says:

Take the analogy of satellite TV. You pay once and you get a bouquet of hundreds of channels. The transaction is simple and easy. You know you’re getting good value for money too because there is an economy-of-scale effect at work. Now imagine another scenario: What if you have to pay individually for each TV channel and go through the effort, time and extra cost to do so. It’s a no brainer really.

Of course from the consumer’s point of view, it makes a lot more sense to pay once for a bundle of content rather than paying subs to several different providers or micro-payments for individual pieces of content. However, if newspaper groups had the rationality to think about creating value propositions for their readers, they might have spared themselves the mess that they are in.

The big question, as Matthew highlights, is whether a significant number of publishers will choose to join Newspass or create their own payment system. I’m not sure that such a payment system would be possible in all jurisdictions based on competition/anti-trust law. That notwithstanding, knowing publishers, I would expect them to lobby for a relaxation of anti-competition laws in their own countries to make such a system possible rather than partner with Google, which they have as Matthew rightly points out, a love-hate relationship with. I’d say that it’s bordering on hate-hate these days, but that’s a matter of interpretation.

Matthew sees Google as a “dispassionate third party”, but with the egos in publishing and the ‘not invented here bias’, I’m not sure that publishers see Google as dispassionate or without skin in the game. Murdoch and his lieutenants, though possible an extreme example, refer to Google as a “parasite”. For them to be pushed into partnering with the likes of Google, they would have to be pressured into seeing past their almost self-destructively hyper-competitive natures and see that some loss of advantage was worth new revenue streams. In fact, I would see them being more open to partnering with another company just in an attempt to screw Google. Despite the existential threat facing some newspapers and newspaper groups, I’m not sure that they have seen the light, by which I mean the light some reportedly see with near-death experiences.

The dangerous distraction of GWOG – the Global War on Google

Rupert Murdoch and his lieutenants’ Global War on Google might make for entertaining copy for journalists who enjoy an old fashioned media war with titans going toe-to-toe, but Adam Tinworth has pointed out the danger of taking this rather noisy display of “posturing and PR” too seriously. It is distracting people in the news and information business from dealing with the real issues besetting our businesses.

But in this war of words, the true issues seem strangely absent. Where’s the discussion of how newspapers can compete for readers in the age of the attention crash? Where’s the careful analysis of the role of the general publication when their audience’s time is being slowly eaten away by a million and one niche websites that speak more directly to them than anything a national paper publishes? Who is talking about how you rebuild publishing companies to account for the new economic reality of internet publishing.

These are huge issues that are being completely ignored in the bluster of Murdoch’s posturing. These issues are critical in the development of any paid content strategy.

I would like to think that behind the public bluster that these issues are being discussed in strategy meetings across the industry, but I doubt it. I would wager that Adam and I have discussed these issues over beers more than they have been discussed in any boardroom. I feel relatively confident that I would win this wager.

While Adam highlights the scarcity of attention and abundance of content, industry leaders still boast about the indispensability and exceptional nature of their content. Too many newspaper editors still believe that their competition comes from other newspapers, not from music streamed on Spotify, TV from the BBC’s iPlayer or Apple’s iTunes or Modern Warfare 2 (which sold 4.7m copies in 24 hours). Newspaper journalism is competing for time and attention against a myriad of other choices in an over-saturated media environment. Until news organisations (and content creators of all stripes) begin to grapple with the economics of abundant content much of it of very high quality, we’re not going to take the many steps necessary to create sustainable businesses that support journalism.