The MacTaggart Lecture took place last week with News Corporation’s James Murdoch deciding at long last to take the stand at the MediaGuardian Edinburgh International TV Festival. Murdoch wasted no time in setting his stall out to get support as he painted a grim picture of the state of the UK’s media industry. Pointing the finger at the BBC, Murdoch described the corporation as a villain that had a “chilling” hold on the UK media landscape.
Given that we are in a recession Auntie was always going to be an easy target for the man from Sky. Murdoch though did have an audience.
After all, for quite a number of years we have been told that the news industry is dying a slow death. Print media – national, local and magazines – was passing away. Broadcast news is on the way out. Even subscription-based online news sites were in A&E. All very terminal. And all before one of the worst recessions in living memory, which has this year pushed advertising income down in many newspaper groups by between 20 and 30 per cent.
We are told that we, the consumers, are guilty of killing the industry by wanting our news for free. So whose fault is it that leading papers like The Observer are considering ceasing all together?
The fact is that since media executives decided to chase online advertising revenue stream at the beginning of the decade circulation of print newspapers and magazines have been dropping. As Alan Mutter points out in his blog, publishers couldn’t “figure out how to charge for content without throttling their web traffic and the online advertising that comes along with it.” What execs did was undermine their own industry by offering the goods for free, on a different platform maybe, but still without charge. Thus conditioning consumers to expect news on the house. Interesting strategy.
The Wall Street Journal though stepped out early on and offered access to its content online through a subscription service. They were one of the first to implement this strategy and in 2007 found itself with a daily circulation of more than 2 million, with approximately 931,000 paying online subscribers. While the Journal might be seen as a niche title with a focus on business and finance it certainly is a healthy position to be in, bucking the worldwide downward trend in income and circulation.
Meanwhile the UK-owned Financial Times is a title that has used a subscription-based strategy to its advantage. It decided to reduce the amount of free content available online and started to charge for access to the Lex column, FT Alphaville and others. FT.com now has 117,000 individual subscribers and makes it’s content available on a range of platforms including the US Kindle, as well as a new iPhone app, which was released to rave reviews. The app does what it’s designed to do – give users a taste of the quality journalism that the FT is renowned for through access to free content. But it also tempts users to subscribe to the FT so that they can make the most of the app.
Earlier this year Rupert Murdoch signalled that his news organisations would start charging for access to content online. This after News Corporation announced a 97 per cent slump across its newspaper titles. The rest of the industry took a deep breath, as the unspoken had at long last been made public.
Advertising-reliant media has been hit hard, leaving the industry to rethink its business and wonder how it is going to survive in the recession. The fact is that it can no longer rely on advertising revenue alone from its print and online platforms. With advertising budgets slashed, the news and media industries must find income from the people on the street. That means charging them for content.
Like the FT, The Times already offers a subscription service to readers. I subscribe to both, which is why I wonder if we will see The Times follow the FT’s model of offering limited free content online and in depth to subscribers or pay as you read customers.
Print itself might become a pointer to a fuller online package where news packages can be developed by taste and interest. Pay 90 pence and get part of the story. Subscribe and you get the full picture, together with the background briefings and extra content – video, podcasts, reviews, etc.
And what about magazines, I hear you ask? Well, yes, some titles have been bucking the downward trend, but overall sales are down. The proposition will need to be rethought and subscription services will be brought in.
Publishers like News Corporation have been backing the Kindle as a portable aggregator of news. And it makes sense. What also makes sense is the news of News Corporation meeting with other major publishers to discuss the setting of a consortium that would charge for news online.
Some people have come out and very publically stated that charging for news online won’t work. People expect it for free and won’t part with their cash. I think people will pay, but they will have to believe that they are getting value. In fact people already pay. The Times and The Financial Times already offer and heavily promote subscription based services to their print titles. The FT itself gives access to their content online to those who subscribe to the print edition of the FT. So, could a subscription service similar to this work? I think so. While I myself am a subscriber to both of these titles, as well as plenty of other magazines, I feel that subscription based wall offers exclusivity and value. Of course publishers will have to make sure that what is offered is exclusive, something that differentiates them from their competitors.
Not just that, but if your daily and monthly subscriptions were updated to a Kindle, Apple Tables or other eReader device, say at night when traditionally they went to press, then you knew that you were getting your titles within minutes of the copy being finished.
What you need is an ‘iTunes-style’ store through which you can get access and pay for a wide range of titles from around the world. A store through which you can get your UK titles as well as international titles that tick your interest box, so if you’re into fashion your GQ and Vogue from France, Italy, Japan and the US. And if it’s music, then Spin, Rolling Stone from the US, as well as UK’s NME. All downloaded to your device and updates sent via Wi-Fi wherever you are.
Of course social media will have a game to play in a new media landscape. Titles are already publishing stories on Twitter, sending updates of breaking news stories as well sharing thoughts and knowledges and subjects they cover. Social media is drawing people in to titles and for PRs enabling another tool to listen and follow journalists on their beat.
And ramping up subscriptions when advertising is down can only be a good thing for an industry that as tradition relied on advertising income.
You know, it might just make sense.
And as for the BBC? Well, news outlets need a standard to measure themselves against and the BBC is that standard for news quality. Criticising the BBC in my opinion is highlighting the weaknesses in your offering.