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paid content

Readers must perceive ‘real value’ to pay

by Kevin on October 14, 2009

PHD Media, a division of media and ad giant Omnicom Group, has released a new study that feeds into the paid content debate, reports CNBC. Julia Boorstin of CNBC highlights a few ’surprising factoids’.

  • The bottom line: consumers are reading more print content online, but the only way they’ll pay for it, is if they perceive a real value and when comparable free content isn’t readily available.
  • Another surprising factoid: consumers don’t care about the brand, they care about the content. (Except when it comes to sports)

Frankly, I don’t find the last one that surprising, especially when you factor in the study found that 44% of respondents in the study accessed a publication website through a search engine. Search is a fundamental shift in information consumption. People don’t browse for information but use search to seek it out and also rely on recommendations from friends.

As I’ve often said publicly, my reading habits are voracious and promiscuous. My reading habits tend to be subject led, not publication led. I seek out information. I am a little cautious of extrapolating my behaviour more broadly because I’m a journalist. I am paid to read, research, report and write. I’m also very digitally focused. I get most of my information via the internet or my mobile phone. However, recent studies such as this one show that I’m not unique in my habits.

This study reinforces my view that news organisations need to focus on developing services and products that deliver value to readers and not simply focus on building infrastructure to charge for existing content. Another take away from this study is that “just small a fraction of the 2,400 adults polled, read both the print and online versions of the same publication”. That leads me to believe that the products that we develop must serve the needs of digital audiences, and we should be careful about trying to focus digital development on services to appeal to print audiences.

The debate rolls on

The Great Paid Content Debate of 2009 rumbles on. On Tuesday at the Paley Centre, Stephen Brill on paid content services provider Journalism Online LLC said on Tuesday that people had been paying for print content for decades and that they just needed to get back into the habit online.

However, I tend to agree with Vivian Schiller, president and CEO of US public radio broadcaster NPR, when she commented at the event:

To think that we are so smart that we can retrain the audience, that’s an awfully elitist, condescending, and frankly old perspective.

Trying to bully consumers into behaving a certain way, especially in a way that is contrary to their current habits, doesn’t have a track record of success.

To be fair to Brill, he is not advocating putting all content behind paywalls and is working with news organisations to determine what content will become paid. However, I reject his basic premise, which he has stated over and over, that this is a matter of getting users accustomed to paying for content online. I do agree that to continue to support journalism, news organisations are going to have to develop new sources of revenue, digital and otherwise.

On that point, I’ll just re-iterate something that I’ve said before. In the Great Paid Content of 2009, some journalists and news executives have been playing fast and loose with facts (gasp, shock, that never happens), and one thing that I’m hearing with too much regularity is that newspapers can’t make money online, that digital is just some money pit that will never support quality journalism. I’ve heard this before in the late 1990s. To which I would say, just because your news organisation isn’t making money online, it doesn’t mean that it’s impossible to make money on the internet.

Suw and I were in Norway recently, where media conglomerate Schibsted has an online classifieds joint venture with several local newspapers. In a prescient move, Schibsted launched the site, Finn.no, in 2000. It has grown into Norway’s largest classified site, and it’s a money spinner for Schibsted. The newspapers that will survive will realise that they are in the news not the newspaper business.

Progressive, forward-thinking news organisations made the shift from print to a diversified, multi-platform business before the Great Recession, and there are examples of  information products and services that news organisations could sell to help support journalism. Sadly, most news organisations didn’t make this transition. From the Financial Times:

Alarmingly, the industry has also so far “failed to make the digital transition”, according to a report last month from Outsell, a publishing research firm, which found that news organisations’ digital revenues were just 11 per cent of their total revenues, compared with 69 per cent for the broader information industry, which includes legal and financial data providers such as Reed Elsevier and Bloomberg. 

When we were in Norway, one of the comments that really struck me was a comment from a member of the Norwegian Online News Association who said that there had been plenty of editorial innovation in the last decade but not enough commercial innovation. To support the social mission of journalism, journalists will need to overcome their professional distate for the business side of the operation and lend their creativity to developing products and services that readers value. It’s not only possible but essential that we do this.

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AP’s Curley v Curley and News Corp’s Rupert v Rupert

by Kevin on October 9, 2009

The newspaper industry has woken from its slumber, and they have realised the enemy is not the internet. The enemy is actually you and me, those of us who use the internet. According to the CEO of the Associated Press Tom Curley, “third parties are exploiting AP content without input and permission”, and:

Crowd-sourcing Web services such as Wikipedia, YouTube and Facebook have become preferred customer destinations for breaking news, displacing Web sites of traditional news publishers.

I’m linking to this on one of these third parties sites, Google News, which has a commercial hosting agreement with the AP. Those bloody paying parasites!

Curley was speaking at the World Media Summit in Beijing’s Great Hall of the People. Does Curley know who added those links to Wikipedia, shared those stories on Facebook or uploaded those videos to YouTube? Internet users, you, me and millions of others around the world. For Mr Curley, the internet is a “den of thieves“, says Jeff Jarvis.

Jeff offers his argument against this view of the world. However, I’d like to stage another bit of a debate, one possible through the virtual time travel of the internet. Let’s get ready to rumble! In this corner, we have the Curley of 2009, who argues:

We content creators must quickly and decisively act to take back control of our content.

With that jab, a slightly younger, slightly more optimistic Curley of 2004 lands a right hook: “The future of news is online, and traditional media outlets must learn to tailor their products for consumers who demand instant, personalized information.” The Curley of 2004 instead sees this future from his own past:

the content comes to you; you don’t have to come to the content so, get ready for everything to be ‘Googled,’ ‘deep-linked’ or ‘Tivo-ized’.

Ouch Tom 2009, that looks like it hurts. Next up in our virtual cage match is a spry 78-year-old, Rupert Murdoch! Let’s start with the Rupert of 2009:

The aggregators and plagiarists will soon have to pay a price for the co-opting of our content. But if we do not take advantage of the current movement toward paid content, it will be the content creators — the people in this hall — who will pay the ultimate price and the content kleptomaniacs who triumph.

Fighting back is the fighting fit Rupert “The Digital Immigrant” Murdoch of 2005:

Scarcely a day goes by without some claim that new technologies are fast writing newsprint’s obituary. Yet, as an industry, many of us have been remarkably, unaccountably complacent. Certainly, I didn’t do as much as I should have after all the excitement of the late 1990’s. I suspect many of you in this room did the same, quietly hoping that this thing called the digital revolution would just limp along.

It’s a shame to see this come to blows. These guys should really talk to each other. With Rupert 2009 on the ropes, Rupert 2005 delivers this shot:

What is happening is, in short, a revolution in the way young people are accessing news. They don’t want to rely on the morning paper for their up-to-date information. They don’t want to rely on a god-like figure from above to tell them what’s important. And to carry the religion analogy a bit further, they certainly don’t want news presented as gospel.

Instead, they want their news on demand, when it works for them.

They want control over their media, instead of being controlled by it.

Ouch. Can’t you guys make up your mind? Has the Great Recession changed consumer internet behaviour and media consumption trends? Or did the industry’s complacency finally catch up with it?

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Follow The Digital Immigrant’s lead at your peril

by Kevin on October 8, 2009

Roy Greenslade (who also blogs at the Guardian, where I work) pierces Rupert Murdoch’s air of invincibility.

Now, amid the recession, Murdoch is facing up to an uncomfortable reality. His company lost £2.13 billion last year, doing much worse than analysts had predicted. Most of those losses were directly attributable to his company’s acquisition of the Wall Street Journal and its clumsy move into digital media.

In my view, Murdoch is a 20th Century figure. He understands the mass media models of the 20th Century, but he never seems to have grasped the internet. In fact, Michael Wolff of Vanity Fair says that Murdoch has declared on the internet.

Murdoch can almost single-handedly take apart and re-assemble a complex printing press, but his digital-technology acumen and interest is practically zero. Murdoch’s abiding love of newspapers has turned into a personal antipathy to the Internet: for him it’s a place for porn, thievery, and hackers.

I’ve never seen him make a smart internet move. (Ok, I’ll cede that Hulu is smart and getting smarter.) He was late to the party in the 1990s, and by the time he took the dive it was on the eve of the crash and he dove headfirst into the dead pool. He pulled back with a vengeance, slashing and burning his digital divisions as he went. Rather than using his significant revenues to build for the future, he retreated into the past. After Google’s rise, The Digital Immigrant took another dive with the purchase of MySpace, but the social network was almost old news the moment he bought it. Now, he’s being portrayed as a paid content pioneer by terrified lemmings in the industry. They say: “Rupert has always been right in the past. He must be right now.”

Blindly follow Murdoch’s lead in digital at your peril. He’s a 20th Century visionary who has yet to display any vision in the 21st.

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QsOTD: Journalists shouldn’t confuse important with simply urgent

by Kevin on October 8, 2009

I’m keeping an eye on the UK Association of Online Publishers conference from afar today by following the #aop3c tag on Twitter. David Gilbertson, CEO of B2B publisher EMAP*, looks to be giving an incredibly insightful presentation, and journalists using Twitter show once again why the service is so useful. Joanna Geary of TimesOnline posted this very cogent comment from Gilbertson:

While news is urgent it may not be important and people pay for important.

Hard copy news businesses (print) will have to adapt to this, Gilbertson added, and he goes on to further refine the distinction he’s highlighting and its implications to the business of journalism. Matt Ball, MSN UK editor-in-chief, quotes Gilbertson as saying:

Intelligence prompts a decision, information doesn’t. You can charge for the former.

Geary fleshes the quote out a bit more: “David Gilbertson: B2B must deliver inteligence to help people do job, not info that people don’t know what to do with”.

UPDATE: David Worsfold clarified that he wasn ‘t quoting Gilbertson in the comments. It’s not clear whether Gilbertson said this or rather if it’s a bit of analysis from David Worsfold with Incisive Media, but I think it’s a makes a point worth highlighting. Worsfold either says or quotes Gilbertson on Twitter that these distinction between importance and urgency, between intelligence and information have “implications for news obssessed editorial teams”.

“Pure news” is not enough but remains critical, Gilbertson says. Pure news must be supplemented with data and analysis. He does draw a distinction between B2B and B2C publishing saying that intelligence is a critical driver in the B2B sector while consumption in the B2C sector is driven by many things that might include intelligence and perspective. However, when Gilbertson says that we can’t provide information that people don’t know what to do with, that is equally relevant to B2C as it is in pure business publishing.

Speaking as a news consumer rather than a journalist, I value information-rich news and context-rich analysis over incremental updates and uninformed commentary. I honestly believe, and my work bears this out, that consumers appreciate when you connect the dots and put information in a larger, more meaningful context. I’m not, and I doubt many average news consumers, are suffering from a lack of information, but I do know that many suffer from a lack of context.

The question for news organisations is how they develop products that deliver value and intelligence that consumers can act upon. These products can be essential new revenue streams for news organisations. As I wrote yesterday, news organisations need to put effort into developing these value-added products in tandem with conversations about charging for them. And yes, this will have implications for editorial teams. We must switch from merely chasing incremental developments to mining stories for meaning. In these tight times, we need to ask questions of how we can turn information that we’re already gathering into intelligence for our readers, and we need to develop unique, compelling products based on that intelligence that our audiences find valuable enough to pay for.

*Disclosure: The Guardian Media Group, parent company of the Guardian and my employer, owns a stake in EMAP.

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Paid content: Real scarcity versus artificial scarcity

by Kevin on September 22, 2009

Mathew Ingram at the Nieman Journalism Lab has an excellent post looking at the issues of paid content in general and micro-payments in particular. It’s a really useful post because he rounds up quite a number of posts and points of view on the subject. One thing really leapt out at me. Mathew writes:

Does that mean newspapers can’t make any money? Not at all. I think Mike Masnick has done a great job of pointing out how a media business can make money even if it gives content away for free — his company Techdirt does it, plenty of musicians and artists do it. And they do it by using the free content to promote the aspects of their business that have *real* scarcity rather than artificial scarcity.

After the Great Recession, news organisations are all seeking news sources of revenue and a more diversified revenue base so that we’re not as dependent on one highly recession-sensitive revenue stream, advertising.

As we look for new revenue streams, journalists need to get real about what adds value and need to be brutally honest about real scarcity. Currently, too much of the paid content discussion is obsessing over the societal value of journalism and not about rebuilding a revenue bundle that supports the socially valuable work that we do. Non-niche news has always been subsidised by other content and revenue streams. It is not dirty and it doesn’t devalue the social mission of journalism to think in terms of what other services and products we will need to develop to support that social mission. I’m more than happy for lifestyle news and food blogs to pay for investigations and bread-and-butter daily journalism. In many ways, it’s the simple recognition that our audiences are interested in many things, not just hard news.

Last week, speaking at the Norwegian Online News Association annual meeting, one of the points made by my fellow panelists was that news organisations have created a lot of innovative editorial projects but not many innovative commercial products. There are a lot of opportunities for news organisations to develop niche news and information products, but we best move quickly. Niche sites and services have already set up a dominant presence in many key content verticals. We also best move quickly on developing mobile apps, desktop apps and other tools to distribute our content and allow for easy recommendation. Steve Outing, for one, sees a lot of possibilities in mobile news and information services. What possibilities do you see to help pay for the social mission of journalism?

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Only 5% of UK readers willing to pay for online news

by KevinSeptember 21, 2009

As I wrote in my post from earlier today, I didn’t know if the statistics from the American Press Institute about paid content held up for the UK market. As if on cue, paidContent.co.uk (owned by the folks who pay my bills at the Guardian) have commissioned a survey in the UK by Harris Interactive [...]

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