ArabianMoney.Net

First with Financial Comment from Arabia

Can Murdoch really get readers to pay for news?

leave a comment »

News Corporation’s boss Rupert Murdoch says he is going to make online readers pay for content from his newspaper stable. It already works for the Wall Street Journal apparently.

He is threatening to remove the WSJ from Google to complete the firewall. For presently if you cut-and-paste a WSJ headline into Google you will get the full story. Ditto for the Financial Times. Why pay for what you can get free?

Technology rules the media

It is incredibly difficult to beat a technology whose time has come. Imagine what happened to all those handwriting copyists when the printing press was invented.

The problem for Mr. Murdoch is that most of his content is not unique. Most of the stories are duplicated by other media, and even if he blocks access with a subscription, it is not impossible for a rival to take out a subscription to get the stories and re-write them.

Indeed, news is vastly over-written. How many news stories on Google offer you thousands of alternative versions from all over the world? You only need one or at most a handful.

The Internet also threatens the business model of musicians. They used to become rich by being able to over-charge for CDs. Now perfect copies can be made instantly in MP3 format for iPods. That revenue has gone for good.

What newspapers have to do is to find alternative ways to make a living. A website with advertising might produce less profit, unless the cost of the content it carries is radically reduced. Eliminate the duplication of stories and the cost of content falls.

Musicians make money by touring, and thankfully that is still hugely profitable as there is only one Madonna or Robbie Williams. For them free music is a loss leader for the real money spinner: live performances. Actually it is back to basics, that is how Mozart made his living.

Saving journalism

Can newspapers do something similar? If they can not get people to pay for content that is freely available could they not ask people to pay a subscription for the local information that they produce? Ironically that could easily be circulated at very low cost over the Internet via email.

However, the days of big media corporations with quasi-monopoly power over the pricing of advertising does seem to be coming to an end, or at least changing. It will be Google and Yahoo that get the advertising revenue in the future and the media world just has to adapt to this new technology.

Trying to get people to stick with handwritten books in the age of the printing press did not work, and neither will paid for news.

Advertisements

Written by Peter Cooper

November 23, 2009 at 9:01 am

Posted in Media

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: