How newspapers are struggling to make money out of the internet
The 'locks are off' Canada's national rag, the Globe and Mail, announced earlier this week, indicating that the executive board is finally coming around to the idea that visitor numbers rather than cash is the name of the game right now.
"Go free," the newspaper proclaimed in announcing the change in strategy. "The Globe Insider subscription programme has retired, and much of the content that required paid access has become free to all globeandmail.com visitors."
The Globe's answer is to make the content free but launch new software tools under a paid product called Globe Plus. Those who pay for Globe Plus get an electronic version of the newspaper in a format that looks like the print version, an investment tool, and access to archives.
This new subscription service is not much fodder to keep a media empire going. They are going to have to figure out the internet quite fast as the pace of change for the industry speeds up. The venerated Globe and Mail is not alone in this difficult position. At least for now, it seems the POM (plain old media), such as the Globe and Mail, need to build numbers first before attempting to lure their advertisers online. Meanwhile they still need to invest in what is still their main moneymaker ¿ the kind of paper you are now holding in your hand.
The POM have been in a difficult position since the advent of the internet. I remember when a former editor and I used to send out the news from Bermuda to students overseas via e-mail, before we figured out what HTML code was all about.
You knew you had to be with the technology, but there was no money in the extra effort. We did it for the love of getting the news out.
POM are now in a position almost every media analyst thought they would be five years ago. The print media face declining advertising revenues on their products, and not enough money from their costly web investments to balance the loss. Advertisers now have a full range of niche sites, including exclusively online publications, to target more specific audiences.
And then there is Google, and other search engines, which use this content. Print media feel their content is being used by the biggest news source on the internet without adequate compensation. Google is estimated to earn about $2 million an hour from advertising revenue.
Some papers have even gone so far as to sue the search engine. Belgium's French-language newspapers have taken the lead, filing a 49 million euro claim under EU copyright law against Google. It is a court battle that papers worldwide are looking on with great interest and support.
I think however claiming for revenues for use of content is in the end unsustainable. The media would instead become simply content providers to search engines, with content a commodity instead of a service that took time, passion, guts and investment.
Newspapers have to live with Google, but like every other technology provider, they do not have to be in thrall to it.
Of interest is a new survey indicating that young adults are suffering from "news fatigue", from being inundated by facts and updates and have trouble understanding in-depth reports.
The study, presented this week at a global media conference in Sweden and commissioned by The Associated Press, surveyed the news habits of 18 men and women 18 to 34 years old in six major metropolitan areas in the US, the UK and India.
AP said the findings helped the wire service design a new model for news delivery to meet their needs. Watch this: the model is called '1-2-3 filing'. The strategy is to first file as quickly as possible an alert headline on breaking news, followed by a short report that the web team could slap online. In the third reworking the reporters add details and editors format the story in different ways so that AP's members can chose to use one version for the web and another for print.
I like the '1-2-3' principle, but looking at AP's response, I feel I am watching the dumb kid in the class slowly come to a conclusion. Or it is a bit like 'back to the future'. Was not this '1-2-3 format' the age-old wire service strategy? At the risk of sounding ancient, this is the kind of format I used to tear off the AP machine as it was printing out stories back in the days when internet or digital delivery was still in its infancy.
Aside: In case you're wondering, we had a team of typists in the news department who would enter the stories into the computer so we could edit them.
On the spewing AP machine, we would be warned of a breaking story by a loud dinging of the machine, and would receive a headline alert of what was to come. Then a fuller story would follow, which would be expanded throughout the day as more details became available. That was 'history on the run', as the news is spewed out.
Whatever. At least AP has pointed out a strategy that many in the POM are using to build eyeballs on the net. Some have found their site numbers boosted as different readers seek out a different fatness to their news. Some want it lean, others want it in full detail.
I point out however that the 71-page report presented at World Editors Forum in Goteborg also contains some interesting conclusions about how our reading patterns are being changed. A major finding noted that participants admitted not giving their full attention to the news because they were almost always doing something else, such as reading e-mail. Welcome to the age of distraction.
Send any comments on this topic or others to elamin.ahmed@gmail.com.