MediaNews, Journalism Online Set to Start Charging for Content

If you are like me and see the great paid-content-business-model-search as 18 months of throat clearing so far, you may have noticed that the harrumphs have gotten longer and louder lately. Two related events in the last several weeks signal that the pace is picking up, and bigger experiments by bigger players may at last be ready for rollout.
 
First, News Corp. has acquired an interest in Journalism Online, suggesting that the Steven Brill and Gordon Crovitz start-up will be the vendor for the long-promised paywalls across the Murdoch empire. News Corp.’s announcement of the investment and concurrent acquisition of the Skiff e-reader platform from Hearst describes the moves as also being a corporate bet on the future of paid online content.
 
Second, Google, an Italian newspaper reported last week, is readying a micro-payments system to be known as Newspass for introduction later this year. Essentially the service would allow a single sign-in and checkout for users who could assemble a shopping basket of content from participating publications.
 
Google has confirmed in a general way that such a service is in the works but said it was not yet ready to discuss details since the development phase is still in process. So, a detailed comparison of the two is not possible right now — though Google seems to be focused on the end-user experience while Journalism Online leads with what it can offer publishers.
 
Journalism Online says it has developed 16 distinct pricing strategies and that a given publisher can mix and match them depending on what content is being offered and what revenue strategy is being pursued. The package can easily be tailored to a limited paid content strategy in which most basics remain free, but there are fees for premium offerings and/or for heavy users (the so-called metered model).
 
Journalism Online, like the Google service, will offer users the opportunity to assemble content from various participating publications and sites. It is not clear at this point whether a given publisher might choose to participate in both services, though there is no obvious reason why they could not.
 
Publishers have the third option of constructing a proprietary paid online platform as The New York Times has indicated it will launch early in 2011, when it institutes a metered system (i.e. charging for a monthly pass after a user reaches a limit of free articles accessed).
 
And there are other existing and prospective vendors in the wings should paid content experiments, limited to date, ramp up significantly. When the Newspaper Association of America issued a “request for information” on paid content platforms last September it got responses from Journalism Online, Google — and 11 others.
 
These ranged from smaller companies with tailored products like CircLabs and Newsosaur blogger Alan Mutter’s ViewPass (an offering he has since mothballed) to bigger companies developing such services, including IBM, Microsoft and Yahoo.
 
Randy Bennett, NAA’s senior vice president for new products, told me in a phone interview that the September request for information was “a one-off effort to identify who the platform payers were — to get that information to members. Then what they did with it was up to them.”
 
The NAA did not endorse one or two best services, nor does it plan to, Bennett added.
 
At the NAA’s April MediaXChange conference in Orlando, two companies — Freedom and Dow Jones regional newspapers — presented case studies on limited paid content experiments. The results ranged from positive in small markets with limited competition to terrible where other strong sites, continuing to offer local news for free, siphoned off most readers.
 
Journalism Online has been in a high-profile business development phase for more than a year now with periodic announcements of hundreds of potential customers (though few actual users as yet). Brill, in a speech at a Denver conference earlier this week, said that he expects a dozen launches using his Press+ platform in the next several weeks and 80 by the end of the year.
 
He also suggested that a full, online-only newspaper subscription should cost 50 to 60 percent of one in print.
 
The Denver conference on “Individuated News” provides a barometer of the quickening pace of experiments and vendor offerings. MediaNews Chairman CEO Dean Singleton said in taped welcoming remarks that two of the chain’s papers will begin a metered system, similar in concept to The New York Times’, in July. Already, he added, the chain’s flagship Denver Post is experimenting in homes and hotels with individually tailored reports produced on a small printer, with customized ads pitched to the content a user selects. (My colleague Bill Mitchell wrote about that effort a year ago.)
 
The conference also featured an announcement by Bill Densmore and colleagues at the Reynolds Journalism Institute at the University of Missouri of two new projects, one rating the trustworthiness of various platforms, the other offering a common aggregation system, that a user can personalize, in partnership with three Midwest state press associations. These will be the topic of yet another conference, later this week, at Mizzou.
 
For all the frenzy of activity, David Bessen, IT director for Media News, offered a useful word of caution at the opening session Monday in Denver: “A lot of experimentation (in paid content) is still going on — the dialogue is rich; the revenues are not rich yet, but the dialogue is.”
 
I’ll second that. A meaningful payoff for vendors and publications is years off rather than months off. Still, after all the hemming-and-hawing and slow R&D, it’s time to get started with real offerings to real readers.

CORRECTION: The original version of this post misstated Steven Brill’s suggestion of what an online-only newspaper subscription should cost. Brill said it should be less than the cost of the print edition, not more.

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