The old-style newspaper business is struggling in many countries around the world.
Falling circulations, shrinking ad revenues because of difficult economic conditions and an ineffective response to the disruptive change of the internet mean that traditional media groups are in danger of going out of business.
So no great surprise when media baron Rupert Murdoch announced recently…
…that he plans to start charging for access to the online content of his NEWS Corporation’s publications.
Predictable scepticism about whether or not he can make this work. Few newspapers have been able to charge for their online content – the Murdoch owned “Wall Street Journal” being one that does.
Charging for access is only likely to be viable, I’d suggest, when there is unique and valuable information being provided. So, it’s not too surprising that specialist financial publications can charge for online access.
But, for the more regular publications I suspect it will be harder.
The big problem for the conventional media is that their business model has been broken by the disruptive impact of the internet.
Media companies never really made their money from selling content. The money came from advertising, especially classified ads. The big newspaper and media groups used to have a stranglehold on the distribution channels for advertising (particularly local advertising).
The internet has destroyed that model and the likes of Google have trounced the old media in the battle for the online advertising market.
So the old business model is broken and the media groups are trying to find a new one. But it seems to me that all their efforts amount to trying to fix up the old model somehow. They still seem to want to rely on charging for content (the digital equivalent of paying for your newspaper) and advertising.
But would a direct response marketing model make more sense in this new era?
Think about it. The old media has 2 big assets…
1. Their content; and
2. Their readership
Instead of charging for online content, how about continuing to make it available for free, but requiring readers to opt-in? Almost instantly, the publication would build a big list that they could then market to.
And they could easily repackage their content into offerings that people would pay for…provided it was properly put together (providing unique, useful information) and properly marketed.
Now, many publications already do this to some extent, but in a half hearted way it seems to me. As an example, I subscribe to Men’s Health, which is owned by direct response marketing giant Rodale.
And yet, I get surprisingly few targeted offers sent to me. Their online efforts are, frankly, pathetic. So if these guys don’t get it, it’s no surprise that the dinosaur media groups haven’t got a clue.
Part of the problem, of course, is that with a few exceptions the traditional media don’t understand their business. All too many newspaper people seem to have vastly inflated view of their own importance and the role of the “Fourth Estate”.
We’ll see I guess, what will happen as revenues come under increasing pressure.