Could Google Be The Itunes Of News?
Let's face it: a fragmented paywall approach to content doesn't serve anyone. Our consumption habits are too dispersed and too immediate to justify paid subscriptions to individual providers. If I'm reading a blog and it links to a source article from a site I don't normally read, I don't want to have to bust out the credit card and pay three bucks to get a bit more info.
Individual paywalls might benefit some big-name players briefly. After all, if you're in the finance industry, you pretty much have to read the Wall Street Journal or the Financial Times. But if you have to pay for each publication separately, you're pretty much going to stick with only the ones you consume consistently. You won't buy a subscription to the Miami Herald if you only read an article from that pub once a year.
Even the biggest players, the ones who do make it to the slim must-read list, will suffer. Generally, the argument for focusing on the most hard-core members of your base is that they're the ones who can best leverage your message to the wider masses. But in this case, the hit to the wallet will combine with near-infinite content competition to steadily whittle away at the potential market for individual news providers, until all you're left with is your most truly radical followers.
So is the solution free content? From the consumer perspective, sure, but not from the perspective of struggling news companies. The situation has gotten so bad that USA Today is reporting a 10% drop in year-on-year newspaper ad revenue as good news: "the smallest such drop since the recession began in late 2007." According to that same article, the newspaper industry is already surviving on just 46% of its revenues from four years ago. You want to be the one to tell them they have to keep giving it away for free?
No, free doesn't work and neither does paid. So what's the solution? Simple: Take the Apple approach.
Consider what iTunes did for the music industry. All of a sudden, we realized we were willing to pay for music. All we needed was an absurdly elegant interface and away we went, 99 cents at a time. Turns out it wasn't that we were miserly; it just hadn't been easy enough to pay.
So last week I found an article on PaidContent.org hinting that Google's Newspass might be ready for launch at the end of the year. Newspass is a paid content system for publishers: one portal, one search engine, one Google Checkout.
This could work, methinks, for the reasons I enumerated earlier. There's one major issue, though: Google's conflict of interest. Consider this comment left on the PaidContent article: "This is a terrible idea for Google and for its users... I would not use Google if I knew that any more than one of the top ten organic results was behind a pay wall... At the very least, the paid results should be segregated from the organic results, similar to the way AdWords ads are segregated now."
A valid point, but not insurmountable. After all, Google hasn't had that much pushback from its other content services. Google News search could switch to a 2-column layout, premium on the left and free on the right or vice versa. There are ways to handle this issue.
What we need, though, is a solution. The newspaper industry is not viable in its present incarnation, and to date its attempts to haul itself into the 21st century have been pitiful. If Google can't make it work as the iTunes of news, we'll need Steve Jobs to step in. Our future as an informed society depends on it.
What's your take? Leave me a comment here or find me via @kcolbin.
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Kaila Colbin is a serial entrepreneur who is fascinated by all things Web and human. Contact her Recent Search Insider Articles
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Kaila, your first paragraph sums it situation up exactly. Being subscriptioned and pay as you go to death - or to the point of bill shlock shock. And the all you can eat form from Google may sound practical, but in the long run, not so good. Besides tasting from an all you can eat is much healthier and more profitable than eating all you can eat.
I wouldn't say that iTunes has saved the music industry. Music sales are down 11% and have been declining for a decade. http://www.reuters.com/article/idUSTRE65K32E20100621
I don't think the barrier to paying for music was ease of paying, though that does help. I'd say that iTunes simply met needs that couldn't be met easily before digital media - instant gratification and pay per track.
The issue that the newspaper industry has that the music and movie industries didn't have is that newspaper content online has been largely free so far. Now you're asking consumers to pay for something that they've previously been getting for free...legally. That's a hard sell unless *all* news content were behind a paywall and consumers had no choice but to pay. Or unless your content is superior enough that consumers are willing to pay the premium.
Personally, I would be willing to pay for good writing and intelligent, thoughtful content. But that doesn't seem to be the objective of the newspaper industry. The majority of publications have sacrificed good journalism in the race to be the first to break a story, hire celebrity personalities, and be controversial for the sake of being controversial. That's why most newspapers don't offer more than what I get through social media.
The concept is good about dividing the pay vs. the free for news information. However, there would be no reflection of the quality of the content with this "divide".
I would think that most people will pursue the "free" search results first. I have to think that some news organizations will keep it free (advertiser supported) and keep the content strong enough to keep the readers. So if consumers can continue to get it for free, they are less likely to pay. If the publishers all go to pay, then consumers will go back to more TV and radio as a news source.
The "paid" news sources will probably only serve those few willing to pay for the additional information on very specific topics.