QOTW: Why are newspapers continually losing money?
I’ve been trying to find problems that exist and then come up with viable solutions. I do my own personal think tanks almost nightly from 5-10 but there’s power in numbers and a lot of smart people around this place. I am going to attempt to come up with something once a week to send out to get brains thinking. Probably not more than that but maybe less. Just depends on how many problems I can find. If you have any suggestions for topics please feel free to email them to me.
This is meant to be a collaboration so please by all means post your reply below.
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Question of the Week:
Rupert’s News Corp Swings to $203 Million Loss
What does this make you think about? What can be done by people that know how to monetize online content? We know people won’t pay for what they can get for free. If major news sources are going to start charging where is the opportunity for free to make money? Is there an opportunity or are online newspaper readers astute enough to look past the ads? How long can newspapers sustain a free model before going bankrupt or changing century old techniques? How long can they sustain a paid model before losing readership?
Columbia Tribune has had Netflix ad pop ups for a long time now. I wonder how much they make? Where are all of the newspapers online aggregation spending going? Are they losing all of their money in the hard copy sales? Are journalists not a dime a dozen right now? The Missourian loses money year in and year out and the University is picking up the tab as a classroom expense.
“Murdoch said that the success of WSJ.com has proven to him that he can charge for content online, and thinks the pay model can be transferred across all of News Corp.’s Web properties”
Does the WSJ have the same news readership with the same disposable income to spend on other pay for news sites; especially if people are offering it for free?
Departing Questions:
Is there an opportunity in aggregating news and monetizing this content while still offering it for free to readers?
Is there an opportunity to learn how to monetize newspaper sites and offer a solution for these newspapers? Think CJ for newspapers?
Popularity: unranked [?]
I’ve been wrestling with this issue for a while, trying to figure out an answer. Obviously newspapers need to move away from subscription based business models. Readers might be willing to pay a subscription to the WSJ and the NYT but probably not the STL-PD or the Columbia Tribune. ESPN has a free content model that gets you to the site and then charges you for certain specific articles. Granted, they’ve got a magazine and like 800 TV channels to help even out the costs, but that might be the way to go.
I had a similar discussion with Nate a few months back and he mentioned the idea that separate industries would in the future be providing the news for their industry. Like the mortgage company blog that eventually becomes the leader in mortgage/real estate industry news because the mortgage company can afford to back it. There are still problems to that, like how can you get unbiased news from a private organization that may be involved, what industry can afford to back the news sites pertaining to crime/corruption, and who does the real in-depth, investigative local reporting.
An old article by David Simon from the Washington-Post on why journalists still matter: http://www.washingtonpost.com/wp-dyn/content/article/2009/02/27/AR2009022703591.html
Good post. Interesting topic.
by Local Donkey
on 07. Aug, 2009
I think you touched on a good point. To make any real money on content you have to appeal to a niche and have some way to monetize or enough other business backing to where it can be a losing venture (but who likes that). This is essentially what all our websites do. We give content and find a way to make money off of it. We have sites that, for all intensive purposes, lose money but they support the sites that make money.
Its tough to say what will happen if profit driven companies control the information flow. its what is going on right now but in a different sense.
Where I falter is with local newspapers like the Stl-PD or Tribune. Their “niche” essentially lies within a geographic area. How can they survive? Are people willing to pay for the casual perusal of poorly reported local news? I know my grandparents would but I doubt our generation will.
I really like Mark Cubans idea (http://blogmaverick.com/2009/08/08/my-advice-to-fox-myspace-on-selling-content-yes-you-can/) about packaging it up as a subscription based term agreement with things people are willing to pay for. Once they are paying for it and the appeal of the initial gifts/gimmicks wear off it will be just like a cable subscription. You’re used to it coming out of your account and used to paying for it. Best idea ive seen yet really.
I think all newspapers should just cancel the print and hire SEO’s to teach them how to monetize their content.
by Josh Kayser
on 12. Aug, 2009
Newspapers make money from advertising. They sure as hell don’t make anything from 50 cents an issue. If print editions want to even consider surviving, they need to totally rethink how they advertise. One way would be to relinquish control over that whole department and hire successful folks in the field. Maybe Google or Craigslist could save the day.
by dipps
on 12. Aug, 2009
@dipps How would Google or Craigslist make newspapers money?
I agree that a newspaper subscription isn’t going to bring in enough revenue, but hell, neither is advertising. Newspapers are on their way out the door and I don’t think I have a problem with that as long as someone steps up and provides well reported, important news. I want to kill myself everytime I have to sit through watching the local news because all they talk about is the state fair and briefly “someone was killed in North St. Louis today…back to you Dan, tell us about the cardinals season.”
@josh I would probably consider paying for local news if it was actually good and relevant.
by Local Donkey
on 13. Aug, 2009