Finding The Business Model For Online News

By Trace Sharp

The biggest news of the week probably is the online conversation that news outlets are contemplating charging for their online content. This is not a new concept and has been discussed repeatedly for years, but the issue is finding a business model that works.

The industry has to contemplate selling their product. Or maybe just part of their product. Take into account ESPN’s online presence. Yes, it gives it’s breaking news product away, but they also have a subscription section called the Insider where readers can find more in-depth reporting, rumors and sports analysis. Although it’s not perfect, it’s working.

It goes without saying that the news industry will need to rebuild and find the balance between what their customers want for free and what they are willing to pay for. This is the dilemma because it daunting to consider the evolution of an industry. And the other thing to consider is in the beginning, many business models will fail. New advertising campaigns specifically designed for the web must be concentrated and not based on the print industry’s preconception on ad sales. Print ads are a completely different beast than online sales.

It’s not the same thing.

One of the biggest obstacles is that the administrators must realize that people will pay for what they want. But, if they can get it for free, it’s a no-brainer. They aren’t going to pay.

By focusing on what our readers want is key. And believing that is worthy of selling is even more important.

And it’s a reality.

From the Daily Beast:

Charging for online content may not be enough to save the newspaper industry, and it almost certainly won’t be enough to save every newspaper now in danger. But the time to reconsider newspapers’ online business model is long overdue. As that reconsideration gathers momentum, it’s critical that decisions be made on the basis of facts. In this dark economic moment, the truth is hard enough.

It’s not a popular notion to set up subscription based sites, however, it’s going to have to happen. The model of ESPN and other news entities that balance some free content while combining it with paid subscriptions to features might be the way to go about it.

3 Comments

Dave Barnes said March 10, 2009 | Permalink

“If they won’t pay for Facebook, they won’t pay for your city hall reporter”

http://www.niemanlab.org/2009/03/if-they-wont-pay-for-facebook-they-wont-pay-for-your-city-hall-reporter/

“I asked them what they would do if Facebook announced tomorrow that it now cost $10 a month. Not one teen was willing to pay.”
Kate said March 10, 2009 | Permalink

Kind of glad I’m getting out of the blogging business. Can’t imagine having to pay. Ok, I’m cheap….I admit it.
Bill Woodall said March 12, 2009 | Permalink

One thing the news business needs to understand is: don’t undercut your paying customer with freebies. The NYTimes had a reasonably good thing going with Times Select – then destroyed it by giving away free accounts to every semblance of a school.

The good parts about Times Select, and the parts I will certainly pay for in the future, if offered, were the email alerts (i.e. automated clipping service) and access to the archives. Now the alerts are free (but not nearly as good – no more wire-service clipping), and the archives are, well, annoying. Some parts free, others not, astronomical pricing for the paid portion.

I’ve watched the NYTimes play with online access for 20 years now (they were available as an experiment on Compu$erve back in 1988-90, at $9.60/hour!). One wonders what the feedback loop is there, as several of the past experiments seemed profitable, at least by what they released to shareholders.

I see no problem with paying for content if it is timely and useful. Indeed I have subscriptions for all sorts of specialty content… but I will not continue if the content is substantially available for free, or if the pricing is capricious.

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Addingle (Ad Ingle) on March 6, 2009

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