Got this email this morning from our friend Geoff, who works for the BBC in London.saw you across the Times paywall this morning - it's created a little media storm here. everyone is watching VERY CLOSELY to see what their hits are going to be like for the next few weeks now. it SHOULD be a flop and Murdoch will have egg on his face. SHOULD... right?
Here's my reply (lightly edited):
I really can't figure out Murdoch's play here. Then again, I haven't looked at how the Times paywall works. How much can you get for free, how is the payment taken, what are the options, etc., etc. (author's note: the reason I don't know is that I'm not sufficiently convinced of the plan's viability to even go study its details seriously). I suppose it is possible to have a pay-to-read system that's intelligent, but I just don't see that there are many "newspaper" products in the world that have sufficient uniqueness and value to succeed on that basis.
But back to Murdoch. There have been two big faces of the "Back to the Paywall" Movement: Walter Isaacson (who seems to have been publicly retreating on the paywall issue since last spring) and Murdoch. In the spring of 2009, people were talking as if they new paywalls were going to be a six-month fix, with "media partners" climbing on board the Journalism LLC bandwagon and "pending announcements" promised in July. Didn't happen, but practically EVERY news organization with a paper on their balance sheet publicly and enthusiastically endorsed the idea in 2009, essentially committing the industry to THIS future and cutting off R&D into any other possible futures. And the big champion of that surge was Murdoch.
Now everybody knows that this isn't going to work. I mean at some level, EVERYBODY, even the people who are arguing for it, already know. If you listen to them, they're saying things like "It's not a pay WALL, it's a pay MEMBRANE" and such nonsense, trying to contend that, well, if we only charge for THIS and not THAT, then we can have our payments and still keep the value of our advertising on our free traffic. Which is really just silly. The only combined future that I can see is content that's SO valuable that readers who pay to see it won't mind if there's an ad or two attached. But I digress.
They figured this out last fall. They ran the numbers. That's the only reason why they didn't all jump off the cliff together, a la the Journalism LLC/Steven Brill scheme.
They know that their best-case scenario is that they spend a few million on technology and implementation, piss off the majority of their online readers and then break even on a revenue system that has ZERO CHANCE of ever solving their essential problem, which is that the value of web and print advertising combined is not large enough to support the print product.
And before you say "Well, they should move 100 percent to the Web then!", the reason they won't is that profitable web products are only marginally profitable, generating enormous profits only on national and international scales. And since they're in the metro business, very few of them have any hope of ever generating profits on that scale. The web cannot replace the 20 to 30 percent profit margins local/metro journalism used to generate, so these bastards remain hell-bent committed to the proposition that they have to force some onerous paywall on the public "to protect free expression and quality journalism."
Even though they know it won't work.
But in their secret, black hearts, there is still this little hope. "Maybe someone will MAKE it work! Maybe RUPERT will do it!"
And so this is the situation that I see: An industry of bitter cowards is hanging around, waiting for someone to jump off the cliff. And since Brill's 2009 counter-revolution never materialized, leaving Rupert as the only big name beating the drum in the street, the role of First Guy to Jump Off The Cliff has fallen to Murdoch (who, as I understand it, developed his own paywall scheme instead of paying some third-party snake oil contractor to do it).
But this is what bugs me. If you're Murdoch, and you sense that this is going to flop, why do it? Do you go all in, or do you hedge? Do you launch paywalls with the intention of hanging your business future on their success, or do you have a fallback plan? Are you the Newspaper Publisher Jesus, sacrificed for the industry's sins? Do you become a very expensive Martyr to The Cause of Mainstream Media Quality? What the fuck is he thinking? And if your answer is, "He really thinks this is going to work," I'm just not buying that.
Meanwhile, closer to home, The Greenville News (Gannett) launched its paywall yesterday. The most commented story on the site was the one with the headline "Login Issues Largely Resolved." And after all the months and months of talk in the industry about how their new paywalls will be permeable and smart and hip and cool and different, about how they REALLY UNDERSTAND THIS TIME that traditional mass media news is just a commodity, not a proprietary product with extensible value, how THIS TIME they're only going to charge for their UNIQUE CONTENT, what did we get from Greenville?
A paywall. Just 2003 all over again.
I wish they'd all jump off a cliff. Unfortunately, I suspect they're going to let Rupert and Gannett and a few others take the plunge first, and then they're going to exit the stage slowly, whining all the way.
We now return you to my previously scheduled career as an entry-level bicycle mechanic, already in progress.