Archive for the ‘Current affairs’ Category

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People WILL pay for online content, research finds

February 15, 2010

Dropping circulations

A new report from Nielsen (FT article – subscription required) suggests a third of people around the world (in 52 countries) would be happy to pay for online content.

While this will please many in the newspaper business (notably Rupert Murdoch, who is introducing paywalls for some of News Corporation’s papers this year), the research findings are not quite the equivalent of a reprieve for struggling newspapers.

The bottom line for newspapers is how much they can earn against their operating costs.  The margins once enjoyed by papers have been eaten up by plummeting circulations, reducing the revenues they generate from both sales and advertising.  This has been exacerbated by people moving online to read their news (and the associated loss of loyalty it is presumed this entails).

Online advertising just doesn’t generate revenues in the way it traditionally did offline, and even online advertising sales have been dropping (these Newspaper Association of America figures make depressing reading if you are in the newspaper industry, and highlight how newspapers online are competing with specialist sites like Craigslist or Gumtree for classified advertising).

So making people pay for newspaper content online is seen by many as the solution (notably not by Alan Rusbridger at The Guardian).  As readers of this blog know, I believe this is the solution.  Either way, the question that has yet to be answered is this: even if a third of people say they are happy to pay for online content, will the revenue this could potentially generate cover the costs of running a newspaper? 

It comes down to a balance between the price newspapers can charge, and the number of subscribers (or people paying micropayments for articles) they keep.

And we will find out whether a profitable balance can be struck later this year, first when News Corp erects its paywalls, and second, when the rest of the newspaper industry decides whether to follow suit.

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Harding calls ‘the trickery and fakery’ of circulation figures

November 18, 2009

James Harding, Editor of The Times

Finally someone has said it.

The editor of The Times, James Harding, yesterday stated that circulation is not the be-all-and-end-all of online newspapers. And he went on to outline a number of ways he can add value for loyal (and presumably, paying) customers.

“We think it’s good for us and good for business to stop encouraging the trickery and fakery of the ABCs. We want real sales to real customers – that’s what our advertisers want too.”

The Murdoch show – followed closely here – rumbles on.

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Murdoch: get off my land!

November 10, 2009
Rupert Murdoch

Picture courtesy of Michael Albov http://www.flickr.com/people/44653897@N00

So that’s how it’s going to be, then.  Rupert Murdoch today hinted that his decision to charge for online content will be enabled by building walls and closing access by legal action.  Not very new media.

The decision to charge for content on News Corporation’s media sites around the world (which include The Times and The Sun in the UK, Wall Street Journal via Dow Jones and The Australian) seemed like the first step in a sensible direction for online media.

Coming just a week after he admitted his online payment plans are behind schedule, Murdoch’s interview on Sky News Australia reveals he is prepared to take a very heavy-handed approach to ensuring he creates a watertight system for monetising his online media assets.

Is this worth it?  While there is rock-solid logic to the argument for charging for media content when there is a cost associated with its creation and distribution, it’s not clear that issuing threats to sue the BBC will genuinely help the media industry move towards a sensible settlement with its customers.

What’s holding back online media is a lack of micropayment standards to allow them to make money from their work.  The focus should be on the establishment of a standard that allows users to pay for what they use, without onerous barriers to entry (so a mix of prepay and post-billed options would make sense).

Even if this is merely the opening parry in what could turn out to be a prolonged negotiation through lawyers and the media, its disappointing that News Corporation’s reputation with anyone other than shareholders seems to have passed the old dog by on this occasion.

I’m not suggesting Murdoch should be operating on behalf of anyone other than his own shareholders… but could you imagine Google looking after its own interests in such a blunt and one-dimensional way?

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The Moir-Gately debate: impact of free comment

October 17, 2009

I have just read about 200 articles, blog posts, tweets and comments about Jan Moir’s sickening article in the Daily Mail on Stephen Gately’s death.

For the record, I didn’t feel much at all about Gately’s death – apart from the tragic fact that someone my age died unexpectedly. So I was surprised, last weekend, when it dominated the BBC News all day Sunday.

It was still dominating on Monday, which surprised me further. But I figured it was merely a case of an establishment figure (you know, friends with Louis Walsh and Elton John – establishment) passing away.

Moir’s article doesn’t deserve comment. It’s just stupid, and I’m sure she knows that. Her logic doesn’t follow at all, but it doesn’t matter because she’s written something to provoke a response, which is her job. Fair enough, no matter how much I think the article itself is horrendous.

But what has interested me (and why I got sucked in and spent an hour reading literally hundreds of posts and comments) is the response.

I started off reading Damian Thompson’s post on the Daily Telegraph blog.  It’s a fairly balanced piece, and makes an interesting comment about the freedom of speech among those living in the ‘social media world’.  His contention is that these ‘liberals’ believe offense is fine if you are ‘liberal’, but should be closed down otherwise.  Freedom of speech, in other words, should not be gifted to people like Moir.

This is a stupid thing to say because what Moir said was not wrong because of her particular viewpoint, it was wrong because she used a false argument to establish a falsehood as a fact.  There is a case for penalising that sort of ‘comment’.  Journalists have a responsibility not to go down that road – the freedom of the press in this country rests on that responsibility.  Her editor should have been the one to throw the book at her.

That Moir’s ‘fact’ was hateful and deeply prejudiced only makes the matter worth doing something about.  Hence the hundreds of complaints.  I would hope that only a small number of these complainants are actually saying ‘nobody has the right to say something I don’t agree with’.

But don’t say ‘gay people are X’ (X could mean sordid, or licentious, or depraved, or evil, or whatever Moir wants it to be) and assert that people who are X (Robbie, Amy, Kate, Whitney, Britney, for example) will die in a bad way.  It is not a logical argument that deserves to be aired and debated.  It is a small-minded error.

So what of Thompson’s point about ‘liberals’ and their attitude to free speech?  The reason I’ve added inverted commas to the word ‘liberal’ is because I want to make a point about Thompson’s use.  I understand the distinction between his use of the word, and it’s real meaning, which is to say something along the lines of ‘broad-minded’.  But it’s a bastardisation, and something popularised by right-wing commentators in America, such as Rush Limbaugh.

The irony is that the comments after Thompson’s post – and hundreds of other comments, posts and tweets I’ve read – are full of precisely the same illiberal (that’s how the word should be used) view that Thompson is rightly criticising.  There are always going to be some people who argue against free speech – it’s nothing to do with being ‘liberal’ or not.

But this brings me circuitously to my main point.  What really interested me was the extremity of many of the views I have read, whether extremely against Moir’s article, or extremely in defence of it.  These extreme views would not have had an airing at any point in our history, but today social media gives them oxygen.

There are religious fanatics and small-minded anti-gays, deeply ‘progressive’ blockheads and anti-capitalists, all happily (or more likely, angrily) making their case on the issue of the day.  And the issue isn’t about poor Stephen Gately at all, it’s about socially important issues – what we are entitled to say in public, how we should live our lives, how concerned we are about the direction of travel of our society.

It is the fact that these views are being expressed for free that makes them poignant.  If your livelihood doesn’t rest on what you say, you can say what you really think.  It makes for a noisy debate, and one that contains some outrageous views.  But it is impossible to argue that – if you read hundreds of those views – it is not balanced.  It just takes a while to find the centre ground.

And so I can say, I have found the centre ground, and here it is: the great British public are sad to see Stephen Gately die, they prefer to judge people based on their character rather than their lifestyle, and they think Jan Moir got this one very, very wrong.

Good for the British people.

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Cash needs to flow for journalism to work

October 12, 2009

The Guardian is taking its digital strategy hyper-local, by launching a number of local news trials, starting in Leeds, Cardiff and Edinburgh.  Written by bloggers – preferably with journalistic training (so, soon-to-be-out-of-work journalists then) – it intends to deliver local news via its blogging platform.

Hyper-local news in Edinburgh might be of more interest to the world beyond the city

Hyper-local news in Edinburgh might be of more interest to the world beyond the city

While this is a sound idea, and is worth testing to see if it can be run sustainably, it does look like the Graun has missed an opportunity to put its money where it’s mouth is.  The job description fails to mention pay at all, and leans towards people with traditional journalistic skills, rather than a new generation of video bloggers who could really disrupt local news gathering and delivery.

The main purpose of the new news service is to scrutinise local politics and report on community news that will be of interest to the local community itself.  The advantage of the digital platform is that stories can filter up to regional or national levels when merited.  But it all rests on the newspaper taking a confident approach to resourcing the service.

Subscription or advertising-funded, the success of the service rests in the confidence of those paying for it.  Go on, The Guardian, pay a proper wage, find exciting young bloggers, and convince people that local news can be interesting.

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Online media must not become a paid-for cartel

September 16, 2009

Rupert Murdoch once again gave a boost to media-by-subscription at yesterday’s Goldman Sachs Communacopia conference in New York.  In a speech where he reported a rebound in the advertising market, he reiterated that News Corp media had plans to increase non-advertising revenue.

The media is now lining up behind the idea that there is money to be made through subscriptions, via either a ‘freemium’ model, offering additional benefits to subscribers, or through micro-payments.

Their long reluctance to go down the paid-for route online suggests that their former view – that ad revenue lost through reduced reader/viewer figures could not be recouped by subscriptions – has changed.

So what makes the subscription model seem so appealing now?  Here are three suggestions:

  1. Ad revenue per media channel is projected to fall so far in the near future that the subscription model is now viable. This is quite conceivable, given the proliferation of media channels.
  2. New technologies such as mobile devices and electronic readers offer a point of difference worth paying for. With Spotify and the Wall Street Journal just two channels offering mobile content for a fee, it suggests mobile devices could boost subscriptions in a previously unachievable way.  As Murdoch said at Communacopia : I do certainly see the day when more people will be buying their newspapers on portable reading panels than on crushed trees.
  3. The mainstream media now believes it can corner the market for paid-for news/analysis.  Recent moves to centralise electronic media behind specific techologies, such as mydigitalnewspaper.com , Google Fast Flip and Journalism Online (which is specifically a payments system) mean the mainstream media may increasingly be able to behave like a cartel. Early moves towards paid-for models by the Financial Times and New York Times may be followed by a mass shift to paid-for online news.

Paid-for online services should theoretically be more customer-focused and financially sustainable than those that are ad-funded – but if pricing were to be set in an uncompetitive way, that would be an unfortunate outcome.

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Murdoch gives the order to charge

August 7, 2009

Rupert Murdoch has done it.  As suggested at News International’s last quarterly earnings call, he says his online newspaper portfolio will begin migrating towards a paid-for model within the next financial year.

The response has been electric, with no media title able to ignore the story.  As previously acknowledged here, at No Free Lunch, Murdoch is one of the few media moguls large enough to foment industry-wide change towards charging for online newspaper content, though in this instance, he is clearly being ably supported by the Financial Times’ Lionel Barber.

Commentary has varied in tone, from outright skepticism such as Larry Dignan’s analysis at ZDNet to praise from Andrew Keen at the Daily Telegraph.

But could this work?

Murdoch is in a unique position in the media – where he goes, he stands a very real chance that others will follow.  What this means is, while the skeptics are right that charging people for content will drive his audience to rival online sources, they are also missing a key dynamic: if the others start charging too, there will be nowhere to go.

The problem for online newspapers since they began giving away their content free has been the fragmented system online – news just leaks.  But if all – or even just a proportion – of the online newspaper community moves as one, this could work to everyone’s advantage.  As Andrew Keen says:

The holy grail of the digital economy is discovering how to get consumers to spend money on content. Nobody has figured this out yet.

So from now on, watch this space for other newspaper groups to announce ‘trials’, and in the longer term, a raft of lawsuits issued in response to plagiarism.