After years of being told that erecting firewalls was a bad idea, publishers are finding that giving their crown jewels away for nothing also has its downside. With newspapers and magazines folding left right and centre, the flaws in the free content model are becoming all too apparent.
It’s a theme that’s cropped up in two of our articles this issue - an interview with the MD of FT.com, which is proving to be an unusually inventive online publisher, and our analysis of online media. It’s been brewing for some time - Tyler Brûlé, back in February, predicted an “hour of reckoning” in these pages. That hour seems to be at hand.
There are clear parallels with what has happened with the music industry. In both cases an established order has been thrown into disarray by a medium seemingly without respect for such quaint notions as intellectual property. With music, the internet allowed content to become an easily distributed commodity online. With publishing, global distribution plus low barriers to entry mean a massive oversupply of both content and advertising space, reducing the value of both.
It is easy to criticise publishers for putting so much content online for free (and there are plenty of people doing so), but it’s also slightly unfair. For years they’ve been told that ad budgets were shifting online. The natural response? Build websites and get people on them any way they can to sell ads against them. And for years the quickest way to a low-traffic website was to erect a firewall. Reversing that trend is a Herculean task. But let’s be clear, this is not a problem invented by publishers; it is a problem built into the internet and exacerbated by Google News.
So how will all this pan out? What is clear is that there is still money in print (both ads and subscriptions), just a fair bit less than there used to be. And there is still money in online publishing, just not enough to sustain as large a pool of big corporate publishers.
Somewhere in there is a media business with a healthy future. The neat conclusion is that we will see a mix of high-quality multimedia publications able to draw large or specialised audiences and in some cases charge for content (probably through some form of micropayment system). Alongside that will be a long tail of much smaller, web-only businesses. What we’ll lose is the undifferentiated mass in the middle. And to be fair, the world won’t be a poorer place without a bunch of titles relying on wire copy.
But as we’re finding, few things about this downturn are proving neat. When the future of a title like the New York Times - a paper that should by any measure be regarded as premium - is under threat, something is going very wrong.
Got a view?
Email david.tiltman@media.asia
