The New York Times announced yesterday that it will no longer be offering its news online for free. Beginning next month, readers will get two articles per month at no charge. They will pay for the rest.
This announcement prompted a Twin Cities TV station’s news to ask people on the street if they would pay for news online. "No," replied one. "Not when I can get it from other sources online for free."
All the other interviewees echoed that sentiment.
Finally, the reporter asked the last person if she would pay if all the news sources online charged. "Well, yes, I suppose that I would pay if I had to," she responded.
How likely is that to happen?
News organizations, especially newspapers, made a huge error at the dawn of the Internet. They did not know what they sold. Rather than view what they sold as news and information, they saw what they offered was the form in which the news and information arrived. They saw what they sold as newspapers or TV news. The format, paper or airwaves, mattered more than the content.
Their readers and viewers, however, were picking up the paper or tuning into the broadcast for the news. They didn't care about the format. They wanted the information. Therefore, when the news became available online 24/7, readers and viewers found getting the information online convenient.
This disconnect between what the readers and viewers wanted and the way that the newspapers and TV news perceived what they sold spelled trouble for the news organizations. You see, the way that these news organizations make their money is by inserting ads or commercials amid the news stories. In addition, the newspapers are accessed by subscription, which is more revenue for them. Free online availability of the news wiped out those sources of revenue. These news organizations cannot insert the number of ads or commercials online that they can in print or during a broadcast.
They did not initially see their problem, however. Since they didn't know that they had a problem and they didn't know how to use the Internet to make money, they did what everyone else did at the dawn of the Internet. They climbed on board. They set up a Web site. They started having their stories available online as well as in print and on the airwaves. "Hey, look," they proclaimed. "Find us on the Web. Read our stories or watch our news whenever you want."
They thought the Internet was a great marketing tool. Since everyone else was climbing aboard the Internet, they got on, too. They certainly did not want to be the last organization to do so. None of them sat down and thought this through first. Nope. They just climbed aboard the Internet bandwagon. No news organization likes to be the last. They all want to be the first with the story. They certainly did not want to be the last on the Web.
Now newspaper subscriptions are declining at a rapid pace. So is TV viewership. People are getting their news online. Since the newspapers and TV stations offer the news online for free, that is what people have come to expect. They have been trained by the newspaper and TV stations to get their online news at no charge. That is a difficult training to reverse, especially when all the organizations that provide news need to do so. As the last interviewee noted, "If they all charge, then I will have to pay."
That's not likely to happen, particularly when these news organizations still do not know what they sell and why the customer buys.
Learn from these news organizations' error. Know what you sell and why your customer buys.
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