There has been a lot of articles written lately on Rupert Murdoch's latest comments regarding the need to charge online readers for the content they access to the business model The Wall Street Journal utilizes. Murdoch recently announced that additional News Corp's newspapers would be charging users access to their online content.
Speaking on a conference call as News Corporation announced a 47 percent slide in quarterly profits to $755 million, Murdoch said the current free access business model favored by most content providers was flawed.
"We are now in the midst of an epochal debate over the value of content and it is clear to many newspapers that the current model is malfunctioning," the News Corp. Chairman and CEO said.
"We have been at the forefront of that debate and you can confidently presume that we are leading the way in finding a model that maximizes revenues in return for our shareholders... The current days of the Internet will soon be over."
That pay for content business model that Murdoch wishes to spread to the the rest of the News Corp holdings has worked pretty well for the WSJ. Yearly subscription to WSJ.com is around $100 and the business news site recently introduced a cheaper micro-payment system. Deane Barker recently pointed out this story on his Gadgetopia blog. Barker points out that this business model could possibly work for additional online news sources, but Murdoch needs "another big player on the bandwagon, and he might kick the snowball off the hill. Gannet? New York Times Company?". Barker's point is that for News Corp's subscription model to work, access to news content needs to be limited at other places online too. In my opinion, a fight against free online content is a war that has already been lost.
As a subscriber to the WSJ in both print and online content, I do see paid online subscriptions working for niche news sites. I however have serious doubts that the model can work for general news. People are willing to pay and only pay for content they can get nowhere else online. The news articles found in the WSJ is unique content and since its also content of value, I'm willing to pay for it. However, reporting general news is a much different game. Even if the majority of newspapers started charging access to their content it only takes one newspaper willing to offer that same story for free to break the pay for access model.
The New York Times charged for their content not long ago and found that the model just doesn't work quite as well as they had hoped. In late 2007, the NY Times stopped charging access to their content. Even if Murdoch can convince every newspaper owner to charge users access to their online content, the business model still fails. The traditional newspaper companies are no longer the sole source for news these days. There is just too many online outlets including blogs and community supported news sites to offer what the old media only once offered. As I've written before, whether for good or bad, the number of days left for old media are numbered.
Now the old media and traditional journalist will tell you that while bloggers and social media sites can offer you news, it is not the same quality of news they can offer. I believe that's true which is why I'm currently paying for my local newspaper in print as well as the WSJ. However, I have doubts that the majority of the public really cares about quality news. Take for instance the content found online at some of the cable news stations. Neither FoxNews nor MSNBC offers much in the way of fair and balanced news. Both cable news stations are obviously bias toward political parties. While CNN seems to do a better job covering the news without political bias they can't help but cater to what the online stats tell them them should be pushed to the frontpage. Yet, these sites are just as popular for their content even though the quality of writing is much less than what is being offered by the newspapers. People don't worry about quality of their news content these days as much as they care about having access to free and convenient news.
I'm sorry, but if you're going to ask me to pay for the news, I'll go elsewhere for free and be just as happy. Why would I do that? Because I can.