Growing and Monetizing News Media

Is it possible? How can news media businesses both grow and monetize their online properties? Tough questions mainstream media publications need to ask themselves at the moment.

This past week the media announced massive staff layoffs that hit its own - AP, BusinessWeek under the new Bloomberg ownership, AOL, and Time Inc.

Meanwhile, a survey conducted by The American Press Institute (API) with ITZ Publishing and Belden Interactive finds that more than half of newspaper publishers believe readers will pay to access online newspaper content.

You've probably heard about News Corp. working on online news charges. Earlier in the month, in an interview, Chief Executive Rupert Murdoch talked about considering blocking Google from being able to search its Web sites. He's with 68% of publishers who believe that, even if readers object to paying for content, they would have a difficult time finding that information in other places.

The API survey of 118 newspapers uncovered how charging for content might play out:

• 38% say they will limit full access to stories to monthly subscribers
• 28% say they will likely offer monthly subscriptions as well as micro payments for individual articles
• 15% expect to offer monthly subscriptions, micro payments, and “day passes”
• 19% expect news articles to remain free but that they will produce content specifically for the website which would be behind a pay wall
• 9% say they may adopt a system which would make visitors pay separately for each story they want to read.

Unsurprisingly, 71% said their objective is “preserving print circulation.” In July, AP announced it would put in place a digital content monitoring system. With actions like reviewing costs and trimming expenses - hence the layoffs - and tracking content or putting it behind a pay wall, so far these sound like defensive moves.

Going back to the way things were is rarely possible. Growth is rarely about cost cutting and eliminating things - it's more with expanding, innovating, and finding a mutually beneficial arrangement between service provider and buyer. The answer seems to be more with cutting Internet access - for example stop Google from indexing news content behind a pay wall - than exploring a new model.

I'm thinking by now the problem has been discussed at length. How about looking at solutions? Some potential models have already been discussed:

• Freemium - a business model that works by offering basic services for free, while charging a premium for advanced or special features (as articulated by Fred Wilson earlier this year). Of course, if you cut off your best editors and writers, a similar problem Christiane Amanpour discussed in reference to news reporting, then who's writing that premium content?

• Subscription-based model - in depth analysis and research that benefits readers by helping them profit from the information. Analysts already use this model, some of them like Forrester and Gartner, quite successfully. Think about information on verticals or specific industries. Look for another take on the metered model at the Nieman Journalism Lab site.

• Microformat source tagging - I was reading earlier about the hNews being developed by the Media Standards Trust and the Web Science Research Initiative, of which Sir Tim Berners-Lee is a director. A news organization could use hNews to display this and other metadata in a format that becomes more user-friendly and makes news more transparent. What if journalists got micro payments every time their article is being used as source for paid publications as a result?

News media business models of the future will come from entrepreneurs and not the current business executives. Jeff Jarvis shares an interesting presentation on the new business model for news as ecosystem (see the rough calculations depicted in the chart above). 

In the end, the future of news will be more aligned with marketing at its most basic, which is developing products that satisfy customer needs, priced commensurate with their value to customers, and in a form (location, time, etc.) they want.

Do you pay for news? In which form - print newspaper, magazine, online? If not, what would convince you to pay for news?

© 2006-2009 Valeria Maltoni. All rights reserved.

Comments

[Roger Toennis]

The future is all about custom/personal information filtering and delivery.

Information overload has already reached a point where people will pay some amount for a service that filters the info-verse in a custom way and delivers it to them in a custom way. I want read "All the News/Blogs/Tweets/Entertainment That Is Fit To Print/Deliver for (Roger Toennis)"

I want to pay for a service that Datamines the web continuously for me getting the info relevant to me without me having to do all the work of setting up and tweaking the filters.

I also want the service to mine the people networks and find people I need to meet and make introductions for me.

In addition I want an option to have a real live person who works for this service to send me personalized voice/video/text notes telling me why I need to read certain articles, watch certain yourtube videos, TV shows or movies. They would also tell about people I should meet and then introduce me to them.

When this service is available I will pay up to $200 a month for it if it includes the personal-assistant-like features.

Help me surf the information tsunami and hang ten on that wave with style and I WILL PAY FOR THAT!!

Eventually almost everyone will as they realize it's the only way to compete and be successful in this new economy.

Roger

[Brian Driggs]

I don't pay for news. Period.

In fact, I'd venture to say that people, in general, haven't been paying for news in a long time.

Advertisers pay for the news. Always have. And when the advertisers stop paying, don't expect the readers to pony up so your multi-national conglomerate can maintain the status quo.

It's like people have a right to news. What sort of demented mind thinks, even for a moment, that the citizenry should be kept from vital information about their community and country if they are unwilling to PAY for this information? I'll tell you who, the people who know damn good and well that they stopped actually reporting NEWS ages ago.

Today's "news" is 99% sensationalism. Catchy headlines - fear mongering, blame placing, and gratuitous sexuality - all in the name of attracting readers/viewers. And then what do you get? An hour long news program wherein each of these urgently spun stories is covered "in-depth" for a grand total of 45 seconds.

Likewise with print. It's all about selling advertisements and subtly pushing political agendas. There's no major news outlet actually reporting news that is of any use to us anymore.

You know what real news is?

It's someone in your field telling you, "Hey, so and so suggested I check out ConversationAgent.com. I've been reading Valeria's blog for a week now and, man, she has some great advice. Bonus! There's other people in the business commenting all the time. We have conversations about really relevant topics. You should totally check it out."

You know what real news is?

It's NPR doing their best to keep the doors open, providing a mix of national and global news stories, with intelligent entertainment programs. It's the way they do what they can with the donations they EARN from their listeners. Anything you hear on NPR can be found on their website. You can re-listen, read the transcripts, and SHARE SHARE SHARE that content.

You know what real news is?

It's hundreds of people on Twitter following the literally breaking story of some experimental hot air balloon with a little boy trapped inside. It's thousands of people each investigating their own angles and concerns and then sharing what they find with the world. It's not the link to CNN which contains the sentence, "Local Sheriff says balloon landed, child not inside."

So we don't pay for news anymore. We CONTRIBUTE to the news. And we do it like this every day. We find the sources that are real, personal, and provide instantly recognized substance and value and we pass that value on to our peers.

Let Murdoch and his cronies wall themselves off and try to find new ways to charge for their product. NOBODY OWNS THE NEWS. Sources will talk to their friends and families. Word of mouth spreads. If a story is worth hearing, it will be heard, and we don't need your freemium, pay-per-article, subsidize-my-lack-of-advertising-revenue-so-I-can-keep-my-private-jets sensationalism.

Thank you, goodnight. :)

(And yes, I realize this line of thinking presents a sort of double standard when it might be addressed towards bloggers looking to make a living from their sites, but I have to think that there are better ways to turn a genuine sharing of knowledge, news and entertainment BY real people FOR real people than charging for the information or otherwise resorting to ads - which my browser has been blocking since 1999 anyway. Topic for another day, imo.)

[CASUDI]

Advertisers paying for news? Advertisers paying based on ratings? Ratings based on the number of people watching and reading the news? What kind of sensational, distorted news is created to gain ratings?

Should news instead be advertiser free?

Is citizen Journalism, as in twitter, approaching more accurate news reporting? Well it does give you the opportunity of viewing multiple viewpoints, and in some instances thousands of comments or views...... We can only hope that this gives us a more accurate sense of what is really going on, even though it is still subject to subjective bias, even if not advertiser or government controlled.

This sure equates to information overload to me! I agree with Roger the future is all about custom/personal information filtering and delivery. Time is money and I’d be willing to pay for it ☺

@CASUDI

[Steve Buttry]

This barely starts to cover the possibilities for new business models. My Complete Community Connection calls for the news business to move beyond advertising: http://bit.ly/qzsKx
And we need to adopt a mobile-first strategy: http://bit.ly/5WCnus

[Valeria Maltoni]

@Roger - I notice that you chose the term information over news. Information to me is much broader than news. Really good ideas and I can see where the value would be for filtering. What about making sense of the information and helping you turn it into knowledge? From stories to foresight to insight. Currently, the Institute of the Future performs such service for organizations willing to pay for it. Perhaps there's room in the marketplace for players who will scale the service to individuals. I cannot help but think that there would need to be segmented or vertical types of information organization and delivery to make it worth doing (read, not cost prohibitive).

@Brian - indeed, I have written elsewhere that citizens never paid for news. We might pay, as Roger here says, for a different kind of deliverable. Something like insights, actionable information, research, bits that can help us at the right time, int he right place. Just in time information and knowledge? I'm warming up to the idea. Of course, that is one of the operational deliverables of social media and social networks - business intelligence in real time. You don't pay me for information I share, but you sure would pay me to help you act on that information, execute on it for your business. Today, it's more about defining the right problems amidst the noise, figuring out what matters in terms of what trends will move people to take action that would be favorable to your business... at least that is my current thinking.

@CASUDI - the problem with citizens reporting news remains that of depth, analysis, as well as breadth as in big picture. We see the world as we are and, no offense to anyone, we're all at different levels in education and knowledge. With eyewitness reports you still need to compile the data...

@Steve - thank you for the links. Had to laugh. Your comment reads like - your post sucks, *my* posts and ideas are so much better!

[Harriet Meth]

@ Brian - Your comments about NPR being real news are spot on. Not only do they "share," as you pointed out, but they also understand how to nuance and make sense out of complicated topics. They were the only news outlet who deconstructed the economic meltdown consistently in a way that was neither dumbed down or CNBC/Wall Street speak/screaming talking heads. I see their approach as one model that just might survive.

@Valeria - Another news development worth watching is what's going on in the hyperlocal scene. True, the very term is now the "it" word of the month, but some of the efforts are interesting for the mix of traditional news with more micro-targeted topics and social media including crowdsourcing. If nothing else, I see it as an interesting development for all marketers to be watching in how to package and deliver relevant information to their various audiences.

[Ryan Waggoner]

I know everyone is predicting doom and gloom and the implosion of the news industry, but I really don't see it happening. I think we'll see continuing declines in print readership and more and more of the news will move to websites, blogs, e-readers, mobile, etc. I think it'll still be almost entirely ad-supported, just like it is now.

I just don't see the huge societal change that has suddenly killed people's demand for news media. What we're experiencing is a medium shift, not a paradigm shift. It'll take time, but the publishers will adjust. Just my .02

[sam carpenter]

As information becomes infinitely abundant, we've become more clanish (which isn't altogether a bad thing). Therefore news media has become more polarized, each individual source gathering loyal adhearants to its particular ideology. Because of the enormous amount of "conversation" going on, there's no hiding what one believes. It's OK. That's a good thing and media is adapting.