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LQD: The End of The Famous ET Murdoch Alert?

by RogueTrooper Fri May 8th, 2009 at 07:52:22 AM EST

Is Rupert Murdoch losing it?


I guess there was more important news this morning - Pakistan, the American banks - but it was Rupert Murdoch who caught my attention. I was stunned to read Andy Clark's dispatch in the Guardian this morning about Murdoch planning on charging for access to his properties on the internet.

Look, Rupe usually knows what he's doing. But this really flies in the face of common sense. He argues that the Wall Street Journal's experience proves that one can successfully charge readers for internet access to one's newspapers.

But does it? The Journal and the Financial Times, are kind of sui generis. They're financial newspapers, read by a global financial elite. You can charge global financial elites to read a tailored product of financial news.

But can you do the same with regular readers, to get them to read general-interest news? The universal experience has been that you can't.

The New York Times tried it and got hammered. It charged for so-called "Times Select" content - most prominently the paper's famous opinion columnists like Paul Krugman and David Brooks - for a little while, hoping to crowbar $50 a year out of saps like me.

It worked in my case, but there was a general hue and cry against it (not least from the columnists themselves). The paper quit charging for this premium content, and the whole experiment was chalked up a disaster.

And now Rupert thinks general readers who refused to pay for the quality New York Times are going pay for the proletarian New York Post? And the Sun and the News of the World? And for that matter the Times (your Times). If people didn't pay for our Times (the New York one - let's face it, an immeasurably better newspaper these days, such that there's utterly no comparison anymore between the two), why will they pay for yours? I just don't see it.


Neither do I, actually. Also, how much are online advertisers going to pay for their adverts the eyeballs can't see their adverts. I was under the assumption that newspapers made their real money from classified adverts not punters paying for their product.


What will the good people pay for?

The Post has the most famous newspaper gossip page in America, Page Six. It started as, well, a page in the newspaper, and actually used to be on page six. Now it's an industry. It runs to three or four pages in the paper most days, has been moved back to page 12 or so while retaining its brand name. There's also a weekend supplement magazine under the brand, and I think there's some kind of TV deal.

It's huge. Movers and shakers in New York and Hollywood (but Washington not so much) read it religiously.

But will they still read it if they have to pay for it? With Gawker and Perez Hilton and TMZ out there? I think some will. I'm not sure tens of thousands will.

Same with sports. The Post's sports pages are terrific. But they don't strike me as being quite so terrific that people will forego several roughly-as-good free alternatives.


He is going to struggle against free.

Hey, if Murdoch's right, he might introduce the rest of the world to the model that can save the newspaper once and for all. That'd be something to celebrate. Or it could be that we're getting to the end of the Murdoch era. In that case, I wouldn't cry.

Sometimes Ozymandias is something to wish for.

Display:
I posted this earlier today.

You can't be me, I'm taken
by Sven Triloqvist on Fri May 8th, 2009 at 08:02:18 AM EST
ooops - sorry Sven

**intense shame**

Money is a sign of Poverty - Culture Saying

by RogueTrooper on Fri May 8th, 2009 at 08:05:59 AM EST
[ Parent ]
No, not at all - I'm glad you raised it as a diary because it is an important subject that concerns us all.

You can't be me, I'm taken
by Sven Triloqvist on Fri May 8th, 2009 at 10:15:23 AM EST
[ Parent ]
As a former Timesonline blogger, sometime correspondent, and general denigrator of their coverage of all things Irish, I can't say I am surprised or sorry that Murdoch seems finally to have lost the plot. I don't think thei internet coverage will be widely missed.  There are so many better alternatives around, and, if you are a blogger, ET is one of them.

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Fri May 8th, 2009 at 08:36:24 AM EST
Internet to Murdoch -> Murdoch will soon be over.

Mr Tomasky has made the obvious points. Why would Sun readers pay extra for Sun content online?

What's less obvious is how anyone is going to make a living producing media online.

Kos has done it successfully, and the Grauniad still seems to be healthy-ish. But what this suggests to me is that anyone who thinks that any format-specific media - newspapers, blogs, podcasts - can survive without major changes in form and content is likely to be very wrong.

That's not how media work any more. It seems to be taking the industry a long time to realise this.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri May 8th, 2009 at 09:22:27 AM EST
[ Parent ]
ThatBritGuy:
Mr Tomasky has made the obvious points. Why would Sun readers pay extra for Sun content online?

You can see the boobs in motion?

Surely the problem is with Sun readers who stop buying the Sun and read/view the content online instead?

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Fri May 8th, 2009 at 10:49:05 AM EST
[ Parent ]
You can see the boobs in motion?

Now there's a business model: sign up for porn and access the WSJ and the NY Post absolutely FREE!

The fact is that what we're experiencing right now is a top-down disaster. -Paul Krugman

by dvx (dvx.clt št gmail dotcom) on Fri May 8th, 2009 at 11:35:22 AM EST
[ Parent ]
The owner of the Daily Express has made a lot of money from his porn empire.

So - er - quite likely to happen, in fact.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri May 8th, 2009 at 03:49:26 PM EST
[ Parent ]
That model might well work for celebrity gossip rags like the Enquirer in the USA.  Have their paparazzi film short clips and embed them in an online blog.  Then the subscriber could watch Brittany's boobs bob while waiting for the still shot of cellulite on the buttocks.  That could expand their market to the husbands of the ladies that now subscribe to the print edition to see cellulite on the stars.  

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri May 8th, 2009 at 05:31:23 PM EST
[ Parent ]
are industries with similar economics: heavy upfront/fixed costs, and very low marginal cost of additional "production"

How do you design a "feed-in tariff" for newspapers?

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Fri May 8th, 2009 at 09:19:37 AM EST
Actually they're not. Printing and distribution can be subcontracted. Editorial is partly freelance anyway. So there's no real need for upfront payments.

You don't need massive plant - if you wanted to start a print operation you'd need maybe 3-6 months of cash in hand to pay subcontractor costs while you built up circulation. If you could negotiate extended/delayed credit terms, so you might not even need that.

Buying plant would be cheaper in the medium to long term, but it would be something to consider if the newspaper were profitable enough.

There's no such thing as a feed-in tarrif for newspapers because the model doesn't apply. If you're trying to make money from participative media, you don't want to think like a newspaper - you want to think like a completely new kind of media entity with new relationships between readers, editorial, advertisers, and other possible stake holders.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri May 8th, 2009 at 09:34:41 AM EST
[ Parent ]
The newspaper model most likely, imo, to gain share of a shrinking market is the freebie local paper, especially if tied to an online version and citizen reporting. These kind of papers ignore national and international news entirely - unless it impacts directly on the community.

Typical circulations are 10 -25K, with triple readership. Historically they are based on a large printing operation that can run off 20K copies fast - maybe doing anything up to 200k a week. So several titles will each cover town clusters of around 50 km radius.

Both editorial and advertising content are important to readers: editorial for seeing your community in action, and local ads which are often informational rather than hard sell. Journalistically of course they are the most basic 'Who, What, Where and When', with journos usually taking their own photos.

You can't be me, I'm taken

by Sven Triloqvist on Fri May 8th, 2009 at 10:44:43 AM EST
[ Parent ]
I had that thought, too, this morning while manhandling the Gazette. The publisher (Post-Newsweek) has made rapid changes to print and web formats within the past year, for example, redesign of tabloid into broadsheet and introduction of own-VoD production. Consumer advertising is obviously healthy enough to support print operations. Classifieds, anchored to tri-county circulation, dominate online ad sales. I assume these are generated under white label GOOG software licensed by WaPo.

Staff writers provide all the coverage -- no syndicated content-- which is good. By and large, their reporting connects local officials, public services, and feature stories to state and county patronage.

The organic quality of content and media convergence has been kinda cool to follow.

Diversity is the key to economic and political evolution.

by Cat on Fri May 8th, 2009 at 01:13:12 PM EST
[ Parent ]
I didn't have that thought because most UK local papers are laughably bad.

So much so that while the US has The Onion, the UK has The Framley Examiner.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Fri May 8th, 2009 at 03:53:19 PM EST
[ Parent ]
So?

You can't be me, I'm taken
by Sven Triloqvist on Fri May 8th, 2009 at 04:05:24 PM EST
[ Parent ]
Looks swell on a crackberry.

Diversity is the key to economic and political evolution.
by Cat on Fri May 8th, 2009 at 05:06:16 PM EST
[ Parent ]
Local newspapers will also have to compete for classifieds with free online services. What they'll continue to do well are obits and weddings. Larger free newspapers like Metro will only be able to make money with impression-based ads, which they can survive on because they have a high readership relative to the circulation.
by nanne (zwaerdenmaecker@gmail.com) on Mon May 11th, 2009 at 07:18:48 AM EST
[ Parent ]
I can only talk about Finland where these papers are delivered free (unless you legally block unaddressed mail). They are also available for pick up in supermarkets, gas stations and cafes. I see people reading them often - the age group being over 30. For this audience, the online world - if it is available or of interest to them - may be used for booking holidays and online banking, maybe also for online shopping (highly developed in long distance Finland), but for local news, local ads and classifieds, the local rag is still king.

You can't be me, I'm taken
by Sven Triloqvist on Mon May 11th, 2009 at 09:33:42 AM EST
[ Parent ]
[Murdoch Alert] YOU ARE NOT AUTHORIZED TO ACCESS THIS CONTENT
by afew (afew(a in a circle)eurotrib_dot_com) on Fri May 8th, 2009 at 09:45:26 AM EST
Rupert Murdoch Switching Sides On Free Content? | Techdirt (by Mike Masnick)
[..."In a talk at a cable industry event"...]

Then he moved on to the question of free content:
"People reading news for free on the web, that's got to change."

That's about 180 degrees from what he said just a year and a half ago, when he noted:
"We are studying it and we expect to make that free, and instead of having 1 million [subscribers], having at least 10 million to 15 million in every corner of the earth.... Will you lose $50 million to $100 million in revenue? I don't think so. If the site is good, you'll get much more."

Perhaps Murdoch of today should go talk to Murdoch of 2007.

by Bernard (bernard) on Fri May 8th, 2009 at 10:52:05 AM EST
European Tribune - LQD: The End of The Famous ET Murdoch Alert?
I was under the assumption that newspapers made their real money from classified adverts not punters paying for their product.

The second largest morning paper in Sweden - Svenska Dagbladet - had a campaign some time ago. A seller called you uup and offered a subscription to the paper for free! All you had to pay was the delivery cost. Turned out that was not that far from what a subscription normally costed.

Loosy campaign, but very illustrative when it comes to newspaper economics (and why the Metro model is so succesful).

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Fri May 8th, 2009 at 11:53:15 AM EST

Murdoch Will Change the Web--If He Can Find It

I've pointed out before that Murdoch doesn't know where the Internet is--doesn't get email, doesn't use a computer, can't get his cell phone to work. He may, literally, never have opened a web page. News Corp. itself, other than its fluke purchase of MySpace--whose value rose and then, as Facebook surged ahead, crashed--is even more culturally uninterested in digital media than other digitally averse traditional media companies. So when Murdoch has to say something on the issue--when that's what the company thinks Wall Street wants to hear--there's a chicken-without-head scramble in the company to find someone whose been on the Internet to brief him.

(...)

Murdoch is panicking. He really has no idea what to do about the Wall Street Journal, now in freefall, and the dwindling fortunes of his hundreds of other newspapers and television stations (which used to be the cash cows of News Corp.).



In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Fri May 8th, 2009 at 02:44:45 PM EST
If I recall correctly, his net worth has tanked over the last year.  60% of what it was a year ago?  And that would be if he could find buyers for his papers.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri May 8th, 2009 at 05:38:43 PM EST
[ Parent ]
He's certainly been caught short, but there's a lot of political leverage from scale. It's not over yet, but I do believe the Murdoch is 'yesterday's news'.

You can't be me, I'm taken
by Sven Triloqvist on Fri May 8th, 2009 at 05:56:19 PM EST
[ Parent ]
"most prominently the paper's famous opinion columnists like Paul Krugman and David Brooks"

I have to cringe at seeing them mentioned in the same sentence.

I also wonder why anyone would want to read Brooks, ever. Complete lack of intelligence, full steam pontificating, raw propaganda and no shame at the level of self-contradiction he descends to in order to prove that Republicans were always comparatively right.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Sat May 9th, 2009 at 03:37:38 AM EST
The problem with the NYT is that they charged for their opinion but kept their news free. The WSJ was doing it the other way around. Of course the Tomasky is correct in saying that the WSJ and FT have a different audience than the NYT or the Times.
by nanne (zwaerdenmaecker@gmail.com) on Mon May 11th, 2009 at 07:01:01 AM EST
[ Parent ]


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