Commentary
Newspaper Execs And Readers View Online News Availability Differently
- by Jack Loechner , Staff Writer @mp_research, November 10, 2009
Among the preliminary findings, nearly 60% of respondents are considering initiating paid access for currently open/free news and information online, and nearly 25% expect to implement a paid strategy in the next six months. This is a big change, says the report, considering that 90% of the responding newspapers currently do not charge for content, and only 3% currently have a paid-only site.
Capturing new revenue and preserving print are likely the key drivers of any final decision to adopt a paid-content strategy. 34% of respondents think capturing new revenue opportunities is or will be the most important factor, while 28% think it is or will be preserving print circulation.
Key Drivers Of Decision Making by News Providers | |
Driver | % of Respondents |
Capturing new revenue opportunities | 34% |
Establishing value for copyrighted content | 18% |
Preserving print circulation | 28% |
Driving product development/new revenues | 13% |
Replacing lost display ad revenues | 4% |
Replacing lost classified revenues | 0 % |
Don't know | 3% |
Other | 2% |
Source: American Press Institute, November 2009 | |
Most of the respondents overlook the opportunities and discount the convenience of e-editions, which give users the experience of reading a newspaper online. Most are not charging for e-editions or are not charging enough:
- Only 67% offer an electronic edition of the paper on their Web sites
- 59% of those offer it free to their print subscribers
- The median price for an online-only subscription is $5.99 a month.
- The median up-charge price, for those who offer it to print subscribers, is $4.99 a month
Current prices for online subscriptions strongly suggest that "convenience" pricing is generally in play, not tied to rigorous price analysis or research into what people are willing to pay. Respondents report a wide range of online subscription charges (from $1 to $27.50 a month), yet they report surprisingly uniform levels of uptake on subscriptions, typically 1% to 3% of print circulation, regardless of price.
While most of the respondents allow users to register for their sites, few require it and even fewer are monetizing registration in any way.
- Only 27% require users to register
- 23% have a specific program for monetizing registration information in active use
- 36% of respondents indicate they are considering a registration program
Web Site Registration Programs | |
Program | % of Respondents |
Allows registration | 71% |
Requires registration | 27% |
Considering registration | 23% |
Monetizing registration | 36% |
Source: American Press Institute, November 2009 | |
The report points out that there is a potentially deep disconnect between news organizations (The Provider) and the audience (The Reader) for their Web sites. Industry executives' responses are compared with user responses aggregated from Belden Interactive 2009 Local Market Surveys. While 54% of news executives rate their online news and information as "very valuable," only 44% of news Web site users see it that way.
Value of Online News and Information (% of Respondents) | ||
| Provider Perception | Reader Perception |
Very valuable | 54% | 44% |
Somewhat valuable | 39% | 51% |
Not very valuable | 1% | 3% |
Not at all valuable | 1% | 1% |
Don't know | 6% | 1% |
Source: American Press Institute, November 2009 | ||
Only 9% of news executives think it would be "very easy" for their audience to find a replacement for the online content their news Web sites are currently providing, compared with 19% of users.
Degree of Difficulty to Replace Online Content From Site Currently Provided (% of Respondents) | ||
Difficulty | Provider Perception | Reader Perception |
Very easy | 9% | 19% |
Somewhat easy | 22% | 33% |
Not very easy | 34% | 28% |
Not very easy at all | 34% | 15% |
Don't know | 2% | 5% |
Source: American Press Institute, November 2009 | ||
The audience that gets its local news and information online would focus on the Internet and TV, not print, if their local newspaper Web site were no longer available. 68% of users say they would turn to other local Internet sites, 45% would turn to television, only 30% would turn to the print edition of the paper, while 75% of news executives think users would turn to their print editions.
Alternative Likely to be Selected if Local Newspaper Web Site No Longer Available (% of Respondents) | ||
News Provider | Provider Perception | Reader Perception |
Your print newspaper | 75% | 30% |
Other local media sites | 55% | 17% |
Television | 53% | 45% |
Other local Web sites | 48% | 68% |
Radio | 46% | 35% |
Regional/National sites | 42% | 37% |
Other newspaper | 31% | 12% |
Other | 4% | 5% |
Don't know | 3% | 2% |
Source: American Press Institute, November 2009 | ||
The report concludes with key variables to be analyzed by news organizations contemplating a conversion to online paid content, or any other revenue opportunities.
To read the variables and recommendations, and for additional details about the study in PDF format, please visit the American Press Institute here.
Jack Loechner is the Editor of The Center for Media Research's daily Research Brief. You can reach him at jack@mediapost.com.
Newspapers need to keep online and mobile readership free. This is coming from 22 years of newspaper consulting expereince. I read the NYTimes several times a day on my IPhone. There is a bottom banner ad constantly in view. Advertising revenue has always been greater than circulation revenue and advertising prices are dependent on readership. That's a simple formula to understand where your bread is buttered. Focus on delivering advertising to readership.
The disconnect seems to me to be on the question of how easily online content could be replaced, and by whom. There really is little difference between users and providers when it comes to considering online news and information very or somewhat valuable: 95% of users and 93% of providers. So far, so good. But the next table shows that when asked how easy it would be to replace online content if a particular news site chose to put it behind a subscription wall, only 31% of the providers thought it would be very or somewhat easy to replace - compared with 52% of their readers. That's a pretty significant disconnect, and it ought to be a warning bell for providers.
Broken record time: the only two things you can charge for online are financial information (because it makes you more money) and adult content for reasons I'm sure are clear to most. Almost every OTHER paid-content model online has failed. Seriously, I read the print paper in the morning and get news online all day from Yahoo. If the Denver Post goes out of business (along with the Rocky) then I won't read the printed version. If the Post website charges for content I (and 95% of those who currently use the site) simply won't go there. The key is for these online entities to find new and interactive ways to attract advertisers - not to charge for what they're currently giving away. I've said it before and I'll say it again (pay attention DNA) A Paid Hulu is a Dead Hulu.
Those that admire free content on websites say the problem is not the free content, rather the lack of ad revenue. Those that admire web advertising results say the problem is under-performing banner, sky scraper, pop over, pop under, etc.-- web ads. Namely under performing assets on newspaper local websites usually look like a generic business card or a version of the outdoor ad I drove past on my way to work this morning. To the free content advocates, I ask how responsive are you to the web advertising to which you are exposed. They are, after all, hoping for your money. The same money you refuse to part with to engage in your online information quest. I also ask if the web-based advertising assets bother you or create a nuisance during your web sessions of traversing the free content world. I also have to wonder how likely are you to patronize a business, hit on an offer, or provide your credit card for an online purchase when there is a general hesitancy to pay for anything online. Until we answer these questions, we will continue to wonder why web advertising is, on a local level, under performing.