As Cornucopia reported in a recent blog post, the media crisis is playing out in the mainstream media, in front of our very eyes on a daily basis. If there only where a way to put that behind a paywall…
Perhaps, this is not exactly the freshest topic to ponder; it has been on every media commentator’s agenda since the beginning of the Internets. However, since it in a sense has, entered a new phase I believe it is fair to address it once again.
The new phase I’m talking about is of course the wider implementation of paywalls on the largest Swedish daily news outlets (do we still say newspapers?). These paywalls came into spotlight again, and has lately been massively debated, partly because people (influencers presumably) stopped sharing those articles. And who could blame them? Why would anyone perpetuate that user hostile behaviour? And, if this presumably pose a problem to the outlets, what where they expecting? Despite warnings from media people of locking up content, what was the outcome for their own consequence analysis before erecting these walls?
My unsubstantiated guess is that they have lost quite a lot of traffic on this and this claim is supported by Joakim Jardenberg in this blogpost. They have probably converted some visitors to their 1-month free offer, and a huge number of these will not continue once it starts costing real money.
Peter Wolodarski has yet to release any figures on the development of this despite several requests to do so.
[EDIT: They’ve just reached 100k digital subsribers and announced that publicly. No details on conversion though, but a 100% conversion from the freemium-month would mean a yearly revenue of between 10-26 msek, including taxes – depending on what level the digital subscriber chooses].
Advertisers will still flock to Google and Facebook though. And they certainly don’t need the content of DN.se or SvD.se to draw the billions of daily users to their app. They can simply ignore this.
Until now, I have largely ignored this debate (due to the never-ending-ness of it) but I happened to come across an old (-ish) episode of the podcast Mediepodden with Emanuel Karlsten and Olle Lidbom – who both are magnificent analysts of our current media landscape.
In this episode they discuss the business model of news, and suggests as a solution what many has talked about before, a Spotify for news.
Why hasn’t a Spotify for news emerged?
Let me just state the obvious – and this is what I missed in Emanuel’s and Olle’s analysis – the media crisis is not because people stopped reading or consuming news. It is because their vehicle of displaying ads has been first, massively disrupted technically, and then squeezed financially because cheaper ways of getting the same reach came along. The ad-buyers basically said bye-buy.
That’s is the fundamental business challenge that media is up against.
What the media have to think about is a solution that is attractive to advertisers, and at the same time keeps the users attention and traffic numbers at a consistently high rate.
A collusion for a majority of the news outlets in a massive news aggregator is probably not the solution since it doesn’t necessarily make advertising more efficient (we already have ad-buying systems that make buying across multiple outlets a breeze) or cheaper or more targeted and precise than what Google or Facebook already can provide.
What digitalisation means for media
To really understand why this model is not applicable to news you have to analyse what digitalisation means for media. It is not simply to make content digital and spread it across apps and websites and raise paywalls around it and expect consumers to be keep being interested.
NEWSFLASH: Content is basically worthless on the Internet. Once it is out there it looses its value and the possibility for the owner to monetize is gone. And I’m not talking about the societal value of news – which is usually what we mean when we talk about the value of journalism. The economic value of news and how it can be extracted is what we are debating, and news is as much a commodity as they come. There’s plenty of it. Your news is no better than theirs. Consumers pick it up on their usual digital paths – i.e Facebook and Google.
But what about real reporting and journalism, and the societal value it brings?
This train of thought, that journalism needs to be saved by all of us, leads to pleas for donations to save important journalism. And that’s is honourable and it is (of course) important, but asking for handouts is not a sustainable business model.
Journalism – or whatever they called it back in the days was a way to create attention and engagement around the ads. They basically filled the papers with content to please the advertisers need for reach and engagement. Begging for support is an out-dated model that only prolongs the slow death of the current way of doing things.
The way forward for news outlets
What is the role of journalism in our daily lives – what is the proverbial ‘job to be done’ for news reporting? That question must be properly adressed. It seems to me, that the reluctance to real change is because they realize it is unsustainable, the way things are now.
First of all, if you are an incumbent media organisation you need to get rid of old dogma and structures. They are effectively hindering your development. Preferably create a separate unit, fund it and let it roam – like Bonnier did with KIT. I truly believe, just like Emanuel and Olle did, that this is not necessarily a job for the incumbents on this market.
Someone with no heritage and vested interests has a better shot at creating a platform where journalism, media and advertisers together create a functional, valuable platform for consumers.
Secondly you need to fully grasp and understand your consumer’s daily life. What challenges do they have, what problems do they face, and how can our resources and capabilities support that? What is the job that consumers need to be done that matches our organisation?
I cautiously suggest that it is not about being bombarded with a million articles with differing viewpoints on a number of topics every day. It creates stress and discomfort.
Rather, people have goals and ambitions in life – such as understanding the state of any part of the world. Or how I can over time, have a better financial life, or how to eat better, train better etc. How can journalism solve for that?
Once you become an important support function in your consumer’s life, you can start to extract value.
And you need to package all of this in an experience that doesn’t resemble a digital version of standing in the middle of Times Square. That means that advertisers needs to be a part of what makes that experience worthwile for the consumers, not something that rejects or scare them away.
/ C