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: Dana Jones is the founder and president of Ultramercial, LLC, which provides premium commercials that grant free access to premium content for clients ranging from American Express to GE to the New York Times.

Can Free Press Continue Online? Why Interactive News Can’t Be Free Forever

Written on: Jun 26, 2006
Author: Dana Jones |
: Share; Can Free Press Continue Online? Why Interactive News Can’t Be Free Forever

Newspapers have put themselves into a pickle. For the past decade they have made their content available online for free, while serving up the same content to their print subscribers, the next morning, for a fee.

What has this business model reaped?

Plummeting print circulation. Over 6% loss on average over the last year, and accelerating. Add to this plummeting share prices, and mutinous shareholders, and in some cases the break-up of national chains.

Haven’t the readers who once had home delivery moved over to the online edition?

Yes. However the online edition does not enjoy the wide range of revenue streams that print does.

Print has newsstand sales, paid subscriptions, the ability to sell the subscription list to outside marketers without the subs’ consent, full-page ads, small space ads, pre-printed inserts, Sunday magazines with ads, and the ability to expand and shrink in size as ad demand fluctuates. They can have an ads-to-edit ratio of 3:1 or more (try that online). Yes, print can be very profitable.

Online, newspapers have very few advertising options. There is no chance of adding a pre-printed advertising insert from Target or Sears. No local car dealers buying up pages in the classified section. Full-page ads? Yes, but the IAB says you MUST have a skip-the-ad button on these interstitial units.

Pop-ups? Well, Internet Explorer now blocks ALL pop-ups by default.

What’s left? In-page IAB units, like leaderboards, towers, and the like, and crawl-over or take-over pages.

But there’s an added wrinkle. In the print version, a newspaper can publish hundreds of ads per day, in all variety of sizes, and get paid for each one based on the number of copies printed, even if readers skip over many or most of the pages.

Online, the paper is at the mercy of the reader. What if there is an average of 5 page views per user session? It becomes impossible, therefore, to sell the same quantity of advertisers at the same impression levels as the print version. The difference in ad revenue between print and online is staggering. For the Tribune Company (Los Angeles Times, Chicago Tribune, New York Newsday), Internet revenue is forecast to account for just 6% of their total income for 2006.

Reader Comments.

Online readers will pay, but only when offered a uniquely interactive level of engagement. Online — and the revenue streams that will certainly follow — is limited only by the imagination of publishers and marketers.

Posted by Allan Hoving | 12:08 pm on June 26, 2006.

I think the revenue model is faulty to charge for content. That can only go so far and yes, readers will bolt somewhere else. Only archives can conceivably charge for content, I think.

I think there should be revenue models of charge per content/article. I know I personally read an article – not a newspaper online. There are too many things out there, and 1 AP news article is published in multiple online newspapers – so why should I pay for ANY news when papers simply syndicate much of the same content?

But – for truly unique news, unique content – why not charge per article? When I use news search or search for news, I look for the news – not the news paper. Yet online newspapers ask for subscriptions – that’s exactly what I DON’T want to do! I don’t want a friggin newspaper – i just want the article.

Another revenue model should be to charge for syndication. It’s easy to use feeds and publish them on other sites. Why not charge online publishers to use the feeds? I have seen some do that, but mainly in specialty news sites. Most newspapers do not charge publishers who reparse feeds on their own sites. Of course that makes it hard for common readers to use RSS – so what can be done?

Right now…I dont know – I think of the ideas.

Posted by Cryptblade | 12:53 pm on June 26, 2006.

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