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A pay wall too classy to fail

  • Thursday, 03 September 2009 16:39
  • Written by Dan Knauss
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Steve Brill raised a stir earlier this year when he announced plans and explained his rationale for building a "pay wall" around the New York Times and other newspapers' online content to "save journalism." The negative responses that followed were rather predictable. One of the best critical reactions to pay walls came from Jeff Jarvis, who illustrated his point nicely by describing how useless and inconvenient the Wall Street Journal's existing pay wall is--so much so that Jarvis said he was dumping his WSJ subscription.

I don't disagree with anything Jarvis said on this subject, but he didn't claim--as others did--that Brill is aiming at nothing less than suicide for newspapers who throw their chips in with him. It's not suicide--for the Times. It may not even be a risky bet. From the perspective of corporate beancounters at the biggest papers it is probably a good risk to take. For the rest, it is only the delusion that they have something in common with the Times that makes Brill's idea even seem like an option.

Brill is right that the country needs plenty of journalistic news providers to be healthy because they provide "honest surrogates" who deliver the information democracies and free markets need to be free. However, most of those surrogates--if they are to be true surrogates for most Americans and their local audiences--are not going to look like the Times in any respect, and strategies used by the Times will not apply. The "journalism" Mr. Brill wishes to save is not journalism per se but a business that has been and may still be able to extract profits high enough (in the hundreds of millions of dollars) to make the whole enterprise worthwhile to people like Mr. Brill. That's not where most newspapers lived for most of their history, and it's not where they can live now or in the future--not from a business or "truth and honesty" standpoint that is actually engaged with the reality their actual audiences live in.

If you are not on Google, do you exist? Or, if you don't read the Times, are you a knuckledragging flyover person?

The main argument against pay walls is they block search engines. That is the major risk, the real unknown. If the Times sets up a major pay wall, it will be playing a game of chicken with Google. The game will center on the question of who can't ignore the other.

Assuming the US is not about to be abandoned by its ruling classes and top income earners--the 1% that holds 35-40% of the wealth--I say Google can't afford to ignore the New York Times and a few other similar papers.

Jarvis can afford to brag about tossing away his Wall Street Journal subscription, but would he say that about the Times? There are strong and unique constraints against treating the Times as just another thing you can take or leave. What you think about the Times--including an opinion of no opinion--says something about you, something that probably matters to you, like it or not.

I don’t know how the Times' mindshare and online traffic are quantified relative to audience income. I'm sure it's high, but the Times has unique value as one of the last journalistic institutions that still sells mojo for the established and the upwardly mobile. That's money. It's not the fact that they have a lock on an elite audience that gives them a shot at winning a game of chicken with Google. It's the effect their elite status has on the perception and behavior of the much larger group of people who directly serve or aspire to join the elite, as well as their haters. (Think Rush Limbaugh constantly mocking the Times brand as a symbol of what he calls the "arts and croissant crowd" or the bicoastal elite.) There are a lot of people who at least feel they can't afford to ignore the Times, or that they can't be who they are or get where they want to go in a world without the Times.

Ooh...class warfare! The subject polite people hate more than religion or politics, which are only sensitive to the extent that they are bound up in class....

Consider the embarassingly obvious: Walking around with the Times or Wall Street Journal says something about you to yourself and other people. The Times commands people's attention--and the attention of people who count more than others. That's why the Times is loved, hated, and needed as a Who's Who and etiquette guide for the boundaries of smart, safe, and correct opinion and cultural literacy. Of course it's much more than that too, but the cultural cachet it has is a unique asset.

Once upon a time--not long ago--this was true of all newspapers to some extent. Now it is only true of the Times and the rare neighborhood or small town newspaper in flyover country that is very likely a barely profitable labor of love. Along with the suits and hats all decent men once wore, the newspaper under their arms spoke to their identity and aspirations. Now most of us use t-shirts to do this, and Paul Fussell--chronicler of class in America, among other things--noted that "only 42 percent of the seventeen-year-old students in American high schools can understand a newspaper editorial.” If newspapers were more like microbrews or other "niche" products that people pay more for--ideally because of quality and not just a status/image vibe they confer--they could probably charge more and require higher barriers for access. I think the Times could pull this off, and it's a move that plays to a strength it has that Google doesn't have at all.

Google is not in the identity and aspiration game--it doesn’t peddle culture. Google helps people focus their attention in whatever direction they are already headed, and those with the most unfocused attention don’t read and certainly won’t pay for the Times. Google's threat to the Times lies in ultra-cheap, micro-targeted advertising on a massive scale with detailed performance results offering business intelligence as an added value. That will happen, and nobody can stop it. So if you've got a lock on your audience, find a way to make them pay more--it makes sense.

Paywalls will make elite newspapers more like a Forrester Research type of media business: semi-exclusive, unique information paid for by a self-selecting audience of readers to whom cost is not an issue. (And then sell yourself as a very select, very expensive advertising conduit to those people.) That's a road the Times is already on, so it makes sense. For smaller papers with a geographically confined reach, especially in economically weak areas and "flyover country," a paywall is of no help at all. The talk nowadays of a trend back to strong local reporting in these areas means catering to an audience of the 99% of Americans on the tenuous middle and lower rungs of the socioeconomic order.

Smaller papers that once had foreign and domestic bureaus will have to come to grips with this reality, much as small midwestern towns with legacy manufacturing industries are dealing with their diminished and diminishing place in the world--a place where the Times is not a model or peer in any respect. Those jobs (in the news industry like the outboard motor industry) are going and gone--and they're not coming back. When journalists--or a new breed of their replacements--start living in this reality and quit seeing themselves as players on farm teams with a shot at the majors--it will be interesting to see what they come up with for news and business models because their thinking and attention will once again be focused on and engaged with the local populations they purport to serve.

Frightening but far more realistic local news models:

The tangentially and essentially relevant George Carlin:

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Don't do like your daddy did -- do more, be more -- read the Times.
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