Stephen Foley: Nice try ? but you’re wrong, Mr Murdoch

It’s desperate stuff. It won’t work, and if newspaper executives on both sides
of the Atlantic follow Mr Murdoch’s apparent lead, I predict we will witness
the collective suicide of scores of news organisations in the US and
elsewhere. Some viable players will squander the chance to find a place in a
new landscape of the news business, which is only just starting to be mapped
out.

There’s a delicious irony here. Mr Murdoch, pictured below, knows as well as
anyone that news consumers are price sensitive creatures. It is 15 years
since he launched his UK broadsheet price war by slashing the price of The
Times. He knows that millions of urban readers have found themselves
perfectly satisfied reading recycled news in freesheets such as Metro in
Britain or amNewYork.

By unilaterally raising the price of his websites ? by whatever model he
alights on, from zero today ? he hopes to tempt others to do the same, at a
stroke fatally undermining their readership, their political clout and their
social relevance. I think it is probably suicidal even for Mr Murdoch’s
titles. The Sun and the New York Post get an “astronomical” number
of hits when they have a celebrity scoop, he pleads, but he’s talking about
a few stories a week at best, and a scoop is only a scoop for a fraction of
a second on the web. News Corp has copyright on the words its journalists
write, but no patent on the facts they discover. As for the broadsheets, how
many survey-the-world generalist news organisations does the internet need?
Maybe The Times of London, as it is called here, will be strong enough to be
one, maybe not.

The problem with many papers is not what they charge for what they do. It is
what they actually do. A vast amount of content duplicates information
available elsewhere. In any other industry, we would call this overcapacity.
The reallocation of resources that must come, towards investigative
journalism and high-value comment and analysis, will be more painful for
some newspapers than others, and competition is much fiercer in a
multi-platform world.

Trade magazines, many of which have always charged online subscription fees,
have a head start in the area of subject specialisms, and they have already
been joined by start-ups like Politico.com, covering US politics, and a
myriad other ad-supported blogs run by investigative journalists willing to
work for much lower remuneration. Many newspapers that introduce online fees
without reforming what they do could end up looking little more than
high-priced aggregators, a kind of Huffington Post that isn’t free. New
platforms, though, such as e-readers and the Apple iPhone, do at least give
newspapers a chance to experiment with hooking people on paying for their
editorialising services.

My view is that the solution lies not in jacking up prices for newspapers on
the web but by inventing new news products that are powerful enough to
persuade people to pay for them. My local paper, The New York Times, is
making another stab at introducing charges for parts of NYTimes.com, the
world’s most popular newspaper website. It is asking readers about two
subscription packages that it calls NYT Silver and NYT Gold, which look to
me like a hybrid of two potential ideas that could help save newspapers. The
packages include just the sort of new features newspaper sites need, such as
access to a PDF archive of the paper going back 160 years, and access to a
scrolling list of new articles before they go live on the website for free.
I think readers might well be persuaded to pay individually for those
features, and they could be sold as applications for the iPhone and other
mobile devices, where people are not already hooked on free.

But NYT Gold and Silver are pitched as if they are memberships to a New York
Times fan club, complete with mugs, discounted tickets to reader events and
chances to visit the newsroom. This sounds a lot to me like another option
for newspapers, which is to turn them into charities and to run frequent “pledge
drives” of the sort that sustain public radio in the US and that other
challenger to newspapers, Wikipedia. A friend of mine told me this week how
he had signed up to pay a monthly subscription to the “Times Reader”
service on NYTimes.com, not because he felt the service was worth it but
because he wanted to give the paper money to help it survive.

I wonder if newspapers of a liberal bent ? particularly if they are associated
with strong values, such as commitments to causes like the environment, say,
or cleaning up politics ? are best placed to do that. Not, in other words,
Mr Murdoch’s stable.

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