Wednesday, October 7, 2009

Dinosaur Publishers Have It All Wrong

The Wall Street Journal stands out among online news sites because it has a viable business model. Some articles are free on wsj.com, but others are only available to subscribers. The non-free articles sit behind a so-called "paywall."

Peter R. Kann, the former chairman of Dow Jones & Co. takes credit for the paywall. "Virtually alone, we chose to charge for our online content," Kann writes in "Quality Reporting Doesn't Come Cheap," an opinion piece published in the Wall Street Journal's Sept. 26-27, 2009 issue. I read this article in the print edition, and I learned that I disagree with Mr. Kann. Based on this one essay, I feel that Mr. Kann could symbolize the stupid, arrogant, unhelpful attitude of most news publishers. I'll elaborate.

Calling the decline of newspapers "a tragedy for democracy," Kann pins the blame on newspaper proprietors who failed to realize that customers "should be expected to pay for both" online and print news. He feels the "downward spiral" predated the Internet by decades and that it was wrong for publishers to rely on advertisers to subsidize readers. The readers should have to pay more, in his opinion. "While consumers expected to pay $1.50 or $2 (or more at Starbucks) for a mediocre cup of coffee, they were offered a quality newspaper for 50 cents, or sometimes even less."

Where I disagree most strongly with Mr. Kann and other traditional publishers is not that customers should pay for value received. The disconnect is whether an unwieldy, black and white, unsearchable jumble of yesterday's news that is 70% or more advertising offers any value to a busy consumer. Kann covers a lot of ground in his article--listing journalistic flaws such as "elitism" and "flea-like attention spans"--but he never discusses what consumers need.

In our hectic, wired environment, consumers need news integrated with other information flows. They need to stay informed by tweet, by SMS alert, and by web page. They need to be able to forward stories to others, to Digg them, to gather a set of links as part of research. Increasingly, holding the newsprint in your hand has become like lighting a wood fire in a fireplace or taking a horseback ride--nostalgic; a good change of pace, which is to say much slower.

Kann says that it was a mistake for publishers to give "young Web disciples" license to take their "preciously-crafted product" and "repackage it with all manner of bells and whistles from interactivity to instant updates to historical archives." The only mistake he sees is lack of profit, by the way, and he apparently sees no irony in calling dumb, dead-tree newspapers "preciously crafted."

His analysis of the Internet is hysterical. Noting that there are "hundreds upon hundreds" of online sites and blogs that "claim to provide news," he concludes that "virtually none of them even pretend to pursue the traditional news role of newspapers." The mission, in Kann's mind, is for professionals to "cover, analyze, and only then comment on, events."

As an aside, Kann observes that a Martian business analyst "logically might question why an unwieldy newsprint product, stale as soon as it rolls off the press and not updated till another sun rises, should not be free whereas the new Internet product, offering all the same news plus more and evolving as does the news around the clock, should not be worth a pretty price?" So, he glimpses how the Internet may offer a better future, but he quickly returns to his main focus--how businessmen can return to charging for their product.

"The decision to charge for an online edition was less courageous than it was consistent," he writes of his bold insistence on pay-for-play over ten years ago. "Why should we give all our valuable content and more away for free in some new distribution channel while charging several hundred dollars a year for it in another?"

There is the problem for dinosaurs like Mr. Kann--they think online is simply a new distribution channel. And "the online editions with growing audiences...rely on the poor print editions for almost all the news they give away. Sadly, there is less and less of that, and the ultimate loser, of course, is the public."

Yes, without journalists to "cover, analyze and only then comment on, events," we might have to rely on access to the actual documents, video of the newsmaker actually speaking, and the combined wisdom of crowds of commentators. It'll be a "tragedy for democracy."

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