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Steven Brill on how to save the New York Times
February 9, 2009 | 2:00 pm
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By Chris Meadows
Steven Brill, founder of Court TV and the Clear airport security bypass service (among other things) has a cogent summary of what is wrong with the newspaper industry and the New York Times in particular, as well as a plan to save it.
The article is worth reading for Brill’s analysis of the flaws in the New York Times‘s business model. However, it is less so for Brill’s proposed solution—as, just like Time‘s Walter Isaacson’s proposal, it involves micropayments.
All online articles will cost 10 cents each to read in full, with simple, one-step purchases powered by an I-Tunes-like Journalism infrastructure. (Apple, which turned my children from music pirates to music micro-buyers, could become a joint-venture participant, but that is hardly the only way to create a convenient payment engine.)
There are daily, monthly, and yearly subscription charges, and even a nickel fee for forwarding an article to someone else. There are other suggestions, as well—targeted advertising, even a merger with CNN—but the micropayment idea seems to be the big one.
The problem with this is, micropayment systems have been repeatedly shown not to work—even when they were founded by people who were well aware of previous schemes’ failure but were sure they had the right idea this time.
You just can’t change the aspect of human nature that makes people reluctant to pay even the tiniest amount for things. There’s a huge psychological gap between free and non-free, even when non-free is just a few pennies. (Clay Shirky has a great blog post along this line about the recent spate of micropayment suggestions.)
Even if they did manage to implement a workable micropayment system, it is uncertain just how much revenue such a thing could take in. Print newspapers make hardly any of their revenue off of subscription fees—and newspapers do not have to worry about print readers haring off to a free competitor’s site with a couple of clicks of a mouse.
Maybe someday someone will make a micropayment system that works. But I’m not holding my breath for it to be very soon.
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Comments:
Micropayments are stupid. Will. Never. Work.
The problem with newspapers now is precisely that they want me to pay to subscribe to a single newspaper now and maybe in the future pay to read a single article. Dumb and dumber.
Instead, what the New York Times and others need to do is aggregate their newspaper holdings and create mini-Lexis Nexis portals for a low monthly cost. Would I pay .10 an article at NYT? No. Would I pay $10/month to access a full search aggregation of the various papers owned by the NYT? Probably. Get enough papers together and then split the revenues based on a percentage basis of which newspapers are actually getting read (so if 40% of articles being read are from NYT, they get 40% of revenue, etc).
Personally, I don’t care because I have free Lexis-Nexis access, but if I didn’t such a low cost service would be very appealing.
Lets make this very simple for all concerned. There are too many sources of information out there and people on the internet are too used to getting information for free for micropayments or subscriptions to work… ever.
I use to read the NY Times online regularly until such point as they tried to make me pay for “Premium” content. Once that happened I switched to the Washington Post; I started reading it again when they dropped the attempt to get me to pay.
Articles are not like music. The vast majority of people buy music to listen to over and over again. Therefore spending 99 cents for a tune is reasonable. I read an article once onece and never again. I might pay one or two dollars to buy an actual newspaper, but to read online? Why when there are other free papers around the world available for free.
In simple terms, if the NY Times and other papers cannot find a business model that allows them to give away their content, then other news sources will find a way.
Knowledge is power and also a cost saving tool for the future. Read my sig for more info on getting faster more efficient and targetted search results with one simple step.
I think that the micropayment idea could work. Fictionwise makes it work for its own business–you add credits from Visa, etc. and use it to buy books. The problem is, would I pay ten bucks or whatever to have a NYT account? Even though I read the NYT on-line every day, I’m not sure I would–there are a lot of other places to get the news for free.
As a publisher, I have to understand the value proposition I offer (in my case, it’s affordable novel-length fiction). NYT needs to do the same thing–understand its value proposition and figure out who will pay for that. Trying to get advertiser support and then charge for content might work, but if I’m paying for content, I’m not real big on intrusive ads, and if I’m paying for an ad, I sure want it to be seen.
Rob Preece
Publisher, http://www.BooksForABuck.com