Why News Corp has made a mistakePosted: November 10, 2009 | |
News Corp’s decision to start charging for its web content is in my opinion a mistake. A huge, can’t believe they really have done this, mistake. Now I fully appreciate that media content companies are struggling to find a meaningful source of revenue in an online world BUT the move to charge readers in this way is, in my view, a mistake. The traditional print media world is so different form the online world that applying the same model is flawed. When you subscribe to a newspaper or magazine you make a lasting commitment for sure. But your choices are limited. If you want to get your printed news from a different source one morning you can but it takes effort. You have to physically go and get it. The same decision online is a matter of clicks. Furthermore, news is essentially now free and people don’t want to pay for it. They can get the basic news from thousands of sources for free so why pay one to deliver it? What they may pay for is a unique and valued perspective. BUT that need will change with the content they are viewing. Again, paying for a single day’s perspective in three month cycles or longer isn’t attractive to most people. Last, thanks to blogs people are becoming more attached to people who create perspective than they are to publications. Signing up to subscribe to a publication that is online seems to be like renting all the magician’s equipment for your kids birthday party and then finding out that the magician has gone to work elsewhere.
I don’t envy the challenge the media faces here. It isn’t easy to see a great solution to the revenue challenge other than advertising revenue. That said the ad revenue model should be something that can be made to work. Online publications ought to be far more cost effective to produce and thus require less ad revenue to support. Online publications are also more able to track how users really use their sites by the hour, so they can improve their product far more efficiently. Indeed when you look at all the advantages online media offers it seems even more sad that News Corp simply defaulted to the old way of charging for media consumption.