Two quick takeaways from Jeff Bezos’ interview with The Washington Post, his first since announcing last month that he would purchase the paper for $250 million:
1. He sounds like an ink-stained wretch whining about The Huffington Post in denouncing the evils of aggregation, telling the Post’s Paul Fahri:
Even behind a paywall, Web sites can summarize your work and make it available for free. From a reader point of view, the reader has to ask, “Why should I pay you for all that journalistic effort when I can get it for free” from another site?
2. Despite his skepticism about paywalls in the age of aggregation, Bezos is not ready to embrace the idea of free content supported by advertising. “I’m skeptical of any mission that has advertisers at its centerpiece,” he said. Good thing: newspaper ad revenues are in the midst of a stunning decline, as this chart demonstrates.
So, if paywalls aren’t the answer and neither is advertising, what will work? Relentless experimentation, combined with time, resources and patience. That’s what the Amazon.com founder brings to the table.
Photo (cc) via Wikimedia Commons.
Discover more from Media Nation
Subscribe to get the latest posts sent to your email.
You can get your revenue from readers or you can get it from business owners. Is there a third source we’re all missing?
A lot of other countries figured this out a long time ago: government sponsorship of media.
Admittedly, this is not a panacea. You can’t rely on government money AND effectively cover that same government objectively. Al Jazeera and the BBC World Service are prime examples of this. But they also provide good examples of how well they can work at covering pretty much everything else. And it’s not like corporate-sponsored news media has been truly “objective” for the last 40 years anyway.
I think Bezos has it partly right. Paywalls are not the solution.
I keep hearing journalists wax nostalgic for the days when people paid for journalism. They really didn’t. The cost of a newspaper has always been a tiny fraction of what it costs to produce a newspaper. It’s always been about advertising. And, in my view, it always will.
The main reason newspapers charge a small token for their product was to achieve a “qualified” circulation. Advertisers have been sold on the fact that when people pay for the publication, they more likely to read the paper. This may be true, but I think advertisers can also be sold on a “free subscription” model. Just ask the publishers of trade journals and weekly newspapers.
To me, the biggest problem with online advertising is the advertisers themselves. They have been slow to embrace it because they don’t see the value. They cling to what they know and understand – which is their ad in a printed newspaper for fixed price.
They fail to recognize that online can deliver guaranteed impressions and quicker links to their websites (which their print ads cannot). They don’t yet appreciate the value of testing different ad components on the fly. They haven’t taken the time to appreciate different payment models such as pay per click.
Someday they will. And when that day comes, online rates will go up and newspapers will begin to see higher revenue from online advertising – more than enough, I believe, to offset the reduced cost structure of online publishing.