Free or paid? Ads or subscription? And what about e-commerce? Everyone in the news business — and many who aren’t — knows of the storm over how and whether news organizations can support themselves. One thing is clear: the people studying the models and trying to use them believe there is a business. They’re just not sure what it actually is.
For four days this week, the Aspen Institute is gathering leading thinkers and practitioners to its Forum on Communications and Society (FOCAS) to figure out what models might work, primarily online. Monday, attendees heard an argument that ads can be the primary support for a network of local and hyperlocal blogs and another that publishers can make money by charging for subscriptions through a different network.
Jeff Jarvis, director of the interactive program at the journalism school of the City University of New York, presented the case for ad support, based on preliminary findings of a foundation-funded study titled “New Business Models for News.” CUNY set up a hypothetical case of a network of 99 blogs covering targeted audiences of tens of thousands in a large metro region of 5 million people with no print daily paper.
The study found that a “large” blog by its third year of existence could achieve revenues of more than $331,000 with, Jarvis said, profits of some $150,000. A network of the blogs could achieve revenues of some $47 million with expenses of about $30 million, he said. And he called for the creation of such a network to facilitate the bloggers working together, selling ads across them, achieving efficiencies and the like. (The project’s News Innovation Web site has a bunch of spreadsheets and the raw data and assumptions.) In some of the models, advertising would be supplemented with other forms of revenue, such as e-commerce and events.
Later, Gordon Crovitz, former publisher of The Wall Street Journal and currently a founder of the startup Journalism Online LLC, which recently announced it had signed up more than 500 newspapers to its program to allow publishers to charge for news, quoted Stewart Brand’s maxim that “information wants to be free” with the lesser known clause Brand also said: “Information also wants to be expensive.”
He suggested publishers need to follow the “freemium” model of having a small, enthusiastic portion of an audience — Crovitz said 10 percent, others say five — pay a fee for full and frequent access to a site. He said a key to charging subscriptions is making it all easy for users, allowing them to pay once and access multiple sources, and, he said, publishers want to “restore the balance of power” with distributors and device makers such as the Kindle, which takes 70 percent of fees it collects. These are services Journalism Online is presumably preparing to offer.
Many questioned CUNY’s assumptions, something Jarvis actually encouraged, such as the idea that there would be no print daily in a metro region the size of Boston’s, or a $12 RPM (Jarvis said “CPM,” but he seemed to be talking about a full-page with multiple ads rather than just one ad spot.)
Others called into doubt some of Crovitz’ analogies to music or sports — for example, he mentioned iTunes as a model to show that people will pay for content they had previously received for free, if the payment made it so much easier. The skeptics said people won’t pay for perishable news as they do for entertainment. Consultant, educator and Tidbits contributor Steve Outing presented other models such as micropayments, tipping and donations, and memberships. He quoted others, including me, on thoughts for what people will be willing to pay for, but had some cautionary notes, as well.
So what’s the right model? There is not one, no silver bullet. Perhaps Mike Fancher, who retired last year as executive editor of the Seattle Times, summed it up best in remarks Tuesday morning quoting Clay Shirky: “Nothing will work, but everything might. Now’s the time for lots and lots of experiments.”
