Tuesday, December 18, 2012

Pay-To-Read —What?

The McClatchy-owned newspapers in Puget Sound (The News Tribune of Tacoma, The Olympian and the Bellingham Herald) are all going to require paid subscriptions beginning this week to read their online content. Just like the big boys Wall Street Journal and The New York Times and just like the small time Skagit Valley Herald and Vashon-Maury Island Beachcomber.

Owner and publisher Mark Owings of the Bellingham Herald describes the change  this way: “Now, it's never fun to ask anyone to pay for something that has been free. But providing unlimited access across all platforms for a small amount makes sense. It also gives us the ability to protect our most valuable product -- our content. I know it really doesn't need to be said, but I'll say it anyway -- a business that gives away its most valuable product for free is doomed.”

The “small amount” for online access begins at an additional 46-cents a week for print subscribers when they renew and an “introductory rate” of 99-cents a month ($69.99 a year) for online-only subscribers.

Let me rephrase Mark Owings’ dictum this way: “A news medium that doesn’t provide its most valuable product — its content— is doomed.”

At the end of October, USA TODAY  reported: “The Wall Street Journal kept its position as the No. 1 newspaper. Its average circulation grew 9.4% to 2.3 million. USA TODAY was second at 1.7 million, followed by The New York Times at 1.6 million. Circulation at the Times grew 40% from a year ago. More than half of the Times' circulation was for digital editions.”

Now, by comparison, the average weekday circulation of the Bellingham Herald is 16,154. The Olympian’s average weekday circulation is 21,876 and the News Tribune of Tacoma’s is 74,826. By comparison, the Seattle Times’ weekday average is 221,665. (Alliance for Audited Media, 6 months ending Sept. 30, 2012)

The joke around our house is that the Monday Bellingham Herald is so light and small that if the wind’s blowing hard, go look for it in the bushes or in the street. But our household subscribes seven days a week— because we like newspapers, even when we have to search down the street to recover them.

The interesting, local news content at the Herald and The Olympian keeps getting less and less as news staffs get smaller and smaller. The bitter irony in news media has been the understanding that advertising dollars pay news salaries. Advertisers advertise because people buy newspapers. People buy newspapers to read the news. Less news to read or more news read, watched or listened to elsewhere— less readers of newspapers. Less advertisers, less revenue, good-bye newspapers.

The revenue generated by subscriptions is real money but not what makes a paper profitable. In the old days when there were service stations or even now with the gas’n’go mini-marts, the real profit doesn’t come from the gas that’s sold but from the tires, batteries and accessories that the service stations of the past sold and the beer, gum and cigarettes today’s mini-marts sell.

What’s sad about Mark Owings’ and McClatchy’s decision to charge for online content is that you will now pay for something you once got for free— without much difference in added value. Somewhat like once being able to use a public toilet for free and now having to pay a quarter to use the same toilet.

It should be instructive for Mark Owings and McClatchy management to take a good look at the reasons for the growth in The New York Times digital circulation. One reason is the aggressive marketing of its enhanced content. The other is the enhanced content itself, the breaking news, the multi-media presentations and background information that subscribers to the print-only newspaper don’t get.

That makes your online content valuable— and worth paying to read.

--Mike Sato

1 comment:

  1. Not so long ago I re-read The Hidden Persuaders by Vance Packard, from the mid 1950's, and I was taken then with his discussion about how it was the big newspapers that hired the best psychologists to help create the advertising for their clients. Those papers knew which side of the bread had the butter!


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