You can't fight what your audience will support

If your typical day begins with coffee while perusing online newspaper, you may want to protect your credit card.

This is because as of March 2011, it will cost you up to $35 a month to peruse the New York Times. But the Times is not the only publication investing in an online paywall as an attempt to generate desperately needed revenue. Currently only a handful of news organizations charge for online content, including The Wall Street Journal, The Financial Times and Newsday.

But is this a necessary evil for newspapers to survive or just a costly mistake that will increase popularity of free news sites? And is charging for newspapers a guaranteed way to increase viewership, revenue and advertisements?

Not at Newsday.

Long Island’s daily paper spent roughly $4 million to redesign and relaunch its site charging online readers $5 a week, or $260 a year, to get total access to news. In three months only 35 people signed up. Newsday’s free Web traffic nosedived, and advertising revenue decreased.

The $4 million that Newsday spent is chump change compared to the reported $40 million New York Times allocated to set up its new paywall.

A factor behind Newsday’s problem is the popularity of free news sites and blogs. In a major media market like Washington D.C. or New York City, a variety of newspapers cover the same geographic area and news. If the New York Times is charging for content but the New York Post is not, what is to say that the frequent former reader won’t turn to the for free news?

Hundreds of news blogs like Drudge and Huffington Post populate their sites with breaking news and analysis. If online news consumers get stuck behind pay walls, they can search for articles from free news sources.

More traditional newspapers look to investigative stories from non-profit news organizations to publish at no cost. However, the same news story written by Texas Watchdog picked up by the Dallas Morning News and Houston Chronicle is available free on As more newspapers use this free content from non-profit journalists, papers that charge will increasingly overlap quality content with those that don’t.

A website charging news consumers is not only costly to the readers but to the newspapers. Newsday’s $4 million redesign has provided a mere $9,000 in revenue. Not many newspapers in this current environment that can risk losing millions of dollars. The current numbers are still out for the New York Times paywall but with $40 million spent, they are going to have to draw a significant audience to recoup their costs.

And let’s not forget that a March 2010 Project for Excellence in Journalism survey reported that 82% of people with favorite news sites said they’d find somewhere else free to find their news if they started asking for payments. Of the more than 2,000 people survey by Pew only 19% said that would pay for online news.

And although early indications are that the New York Times paywall is racking in the readers, a reported 100,000, how many of them joined when it was offered for a free subscription and how many are paying the lowest cost of readership? If half of their readers are reading for free or at a low cost, there is no way that they will break even on this money experiment.

With the majority of the audience unwilling to pay and readily available free options, why should the New York Times paywall be any more successful than the Newsday one? The only way to ensure the success of charging for online content is for every online news site to charge, or no one charges.

Newspapers have to do something to stay afloat, but charging for online content is a risky venture that inflicts the financial burden on readers who are frankly unwilling to pay. If paywalls are the only solutions for the newspaper industry, then publishers and editors need to go back to the drawing board.

Newspapers have to do something to stay afloat, but charging for online content is not the answer.

Jason Stverak is the President of the Franklin Center for Government and Public Integrity, a leading journalism non-profit organization. The Franklin Center is dedicated to providing reporters and non-profit organizations at the state and local level with training, expertise, and technical support. For more information on the Franklin Center please visit

Whining isn't winning

Dear journalists,

Please quit whining about “aggregation,” or whatever other phenomenon on the Internet you’re blaming today for the fact you no longer enjoy the monopoly over local publishing you once had.

To be blunt, whining about the competition is the act of a loser. The publications that win in the information marketplace will be the ones that won’t get bogged down in snit fits over the competition because they’re too busy focusing on – and meeting – the information needs of their audience.

So it’s been with increasing frustration that I’ve been watching the New York Times’ ongoing tiff with the Huffington Post.

I find this verbal battle especially frustrating for as I’ve written before, all reporting is, in essence, aggregation. Otherwise, you’re writing fiction.

Reporting is the act of collecting information from multiple sources for inclusion within a news report. Isn’t that simply a form of aggregation?

I don’t get the complaint that certain online publishers (i.e. Huffington Post) don’t always pay the sources from which they are getting their information, either. I’ve been interviewed by reporters from the New York Times, as well as the Washington Post, NPR, the BBC and CNN. I don’t remember any of them cutting me a check, either. But they used my words to fill part of their pages and broadcast time.

If journalists really feel the need to distinguish themselves from their competition, let them make a case for the value of their reporting over someone else’s. I do believe that there are real differences in value between the various ways that publishers collect, select and present information.

But the focus needs to remain on that value and not simply on the process that a specific publisher follows. If that process creates value for someone, then it’s worthwhile. And if it doesn’t, then it’s not. It really is that simple.

If you want to move beyond the playground name-calling, let’s talk about some of the ways that a publisher might create better value for its readers:

Unique aggregation

Find voices or sources that haven’t been heard in others’ reporting or republication already. Typically, that means find offline sources who haven’t yet had access to the global online information marketplace. Talk to people who aren’t speaking online, and who have a unique experience that hasn’t been reported by someone else before. Dig through offline documents that haven’t been made easily available on the Web. Observe places and events that aren’t being well documented by others.

As more and more people get online around the world, this type of aggregation reporting becomes more difficult to do. But here’s a tip: If traditional journalists sneer that the information you are collecting “isn’t journalism,” then you’re exploring an area that might have been underreported before since those traditional journalists ignored it. That’s not always the case, of course, but don’t ever let finger-wagging from the old school stop you.

Aggregation can be made unique not just in its line-up of sources, but in the ways that they are selected and combined. This is the value of great curation, and where online journalists such as Andy Carvin distinguish themselves.

Unique analysis

This is where the future of journalism lies, I hope. The selection of sources to aggregate is the first step in analysis, but journalists ought not to be afraid of taking the next steps, to check information against other sources and make explicit to readers when information is false or sources duplicitous.

Unfortunately, too many reporters continue to see themselves as nothing more than stenographers, bound by a misinterpretation of journalism ethics that prevents them from ever calling a lie a lie. And as a result, these journalists and their employing newsrooms will continue to lose market share to publications that aren’t afraid to follow through with their reporting and allow it to lead them to a specific point of view: publications like, say, the Huffington Post.

More convenient delivery of aggregated information

Newspapers won lucrative local monopolies because they packaged and delivered information in a way that was valuable to consumers. Fifteen years ago, those consumers started to find it more convenient to get that information by visiting websites throughout the day, rather than waiting for a printed paper to hit their doorstep the next morning. Today, many of those consumers now are finding it more convenient to get information through social networks and mobile apps than to visit newspaper websites on traditional computers.

Again, don’t get hung up on process. Focus on value, and engage whatever process or medium you need to create and deliver that value.

Lower cost of delivery to user

I’m the product of a newspaper war, having worked as the Web editor for the late Rocky Mountain News when it was battling the Denver Post. Both papers were trying to build circulation by slashing subscription rates – down to $3.66 for two years of home delivery at its lowest point. (Yes, that was three dollars and sixty-six cents: a penny a day for the first year, and an extra penny for the second.)

Guess what? Circulation soared. (What brought both papers to near-death was the battle in discounting their advertising rates, not their subscription costs. What each paper gave up in subscription fees was trivial next to what they were giving away to advertisers in the 1990s.)

The lesson here is that as publications lower their cost of delivery to the audience, they build the size of that audience. That cost can be financial, in the form of a subscription fee, or it can be an opportunity cost, in the form of having to go to a website, navigate through a user interface, or be distracted by an ad.

As with anything else in business, this reduces to math. Your audience size will be a function of the value you deliver divided by the cost that audience members incur to get it. As you work to increase the value of your work, don’t forget that whoever provides the greatest value at the lowest cost will be the one who wins the audience.

The conclusion?

No one outside of the field of journalism cares if you consider your reporting more original or more worthy than others’ collection of information. They only care if your reporting delivers them more value than what those others offer. And the readers will make that decision for themselves, thank you very much.

So if you want to succeed in this business, quit wasting your time bagging on others’ business models or reporting structure. If you feel the need to criticize another news organization, hit the ones that are inaccurate or intentionally misleading, instead.

(Then, if you’re into the business of press criticism, go ahead take on the whiners. But realize that only industry insiders will care.)

Otherwise, keep quiet, and focus your energy instead on taking care of your business by taking care of the needs of your community.

The paywall debate: The challenge of charging

The publisher of The New York Times, in a letter to readers, detailed the specifics of their latest paywall attempt Thursday.

The two main points:
1. Users can view up to 20 stories (including video, slideshows and other multimedia content) a month.
2. Stories you are linked to from blogs, social networking sites and the like will not count against the 20 story limit.

The Times is testing this approach on Canadian users now and it will expand to U.S. and the rest of global readers March 28.

“It’s an important step that we hope you will see as an investment in The Times,” wrote Publisher Arthur Ochs Sulzberger Jr., “one that will strengthen our ability to provide high-quality journalism to readers around the world and on any platform.”

From a business standpoint he may be right. Newspapers’ current model isn’t working and they have to pay for all that great journalism.

Now for the BUT.

The Times attempted something similar to this and failed with TimesSelect, returning columnist content to free in 2007 after two years of behind a paywall.

This is what then-Times executive Vivian Schiller (we won’t get into what’s happened to her since) was quoted by Reuters as saying of the decision to end TimesSelect: “We now believe by opening up all our content and unleashing what will be millions and millions of new documents, combined with phenomenal growth, that that will create a revenue stream that will more than exceed the subscription revenue.”

So the logic then was to increase potential ad revenue by increasing the potential audience. Now it’s to do the opposite. It’s been pretty well established that putting up a paywall decreases views and thus decreases advertising revenue.

Then there is the other issue that so often gets overlooked: The is hardly the only source for news. Many other sites, particularly those run by television networks have no incentive to charge for content. They never have. Savvy news consumers can simply go to or or a myriad of other sites to get essentially the same news.

Content is so widely available that, except for very specific stories, users don’t need The New York Times as much as The New York Times needs the audience for advertising. But legacy media, particularly media organizations with a proud history, have a hard time recognizing that.

That is a long way around to make my connection to television news and the challenge of paywalls.

For all of the other newspapers in cities across the country that have three, four or five television stations or more producing news and running their own websites, the news of the day is readily available for free. All a paywall will do is push people to other sources. No one likes to pay for something they can get for free someplace else.

Back to the Times, the decision to allow all users to read stories they are linked to makes their entire paywall moot, anyways.

If I really want to read a particular Times story and don’t want to pay, all I’d have to do is google the headline and find it linked from somewhere else and get it that way. That would just take a few seconds and not cost $15-$35 a month like the Times.