Newsagents In London Are Paying To Offer Free London Evening Standard

from the pay-to-offer-something-for-free dept

Earlier this year, we noted that while many newspaper execs were complaining about "free," the owners of the London Evening Standard had decided to make their paper copy free and that had resulted in much greater circulation and (importantly) lower distribution costs. Part of the issue was that the paper stopped distributing to certain newsstands and newsagents as just not being worth it. Yet, as reader mowgs points out, some of those newsagents so badly want the paper -- even if it's free -- that they're now paying the newspaper to carry it, even while giving it away for free:
The Evening Standard editor, Geordie Greig, said today that the paper had been besieged by inquiries from newsagents wanting to stock the paper as a way to attract customers, even though they were no longer paid a commission.

"What has happened is that entrepreneurial London has taken over. Little companies have got together and have decided to distribute the Standard in little places we decided we couldn't afford to go to," Greig told the BBC Radio 4 Media Show.

"We used to pay a large commission to newsagents to sell the Standard. We now have dozens of newsagents paying us 2p a copy to have copies in their shop ... which they then give away," he said.
Separately, he noted that the rise in ad revenue to the paper has been dramatic, and that they're making two to three times as much in ad revenue on certain days. But, you know, it's "impossible" to support journalism while giving away the content for "free." Rupert Murdoch says so.


Reader Comments (rss)

(Flattened / Threaded)

  •  
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    Anonymous Coward, Dec 17th, 2009 @ 4:19am

    The 2 Techdirts

    Great insight from Mike in the article and now we can look forward to the trolling comments.

    I no longer have to visit the Onion anymore since the trolls here give me daily dose of humour!

     

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    Anonymous Coward, Dec 17th, 2009 @ 5:07am

    Welcome to the temporary, non-supportable situation.

    As for the ad revenue, well, when you remove what was paying to print your paper, and you double the amount of printing you are doing, you better get more ad revenue,or you are in the hole.

     

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      Richard (profile), Dec 17th, 2009 @ 6:04am

      Re: Non-supportable

      Well the previous situation was also non-supportable,
      and, although printing costs may be up a bit - distribution costs have gone DOWN.

      ""We used to pay a large commission to newsagents to sell the Standard. We now have dozens of newsagents paying us 2p a copy to have copies in their shop ... which they then give away," he said."

      So they ARE getting revenue from the newsagents.

      Face it - you don't have their figures - and the guy running the show is a billionaire - so I would assume that he knows more about making money than you do!

       

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        Anonymous Coward, Dec 17th, 2009 @ 7:39am

        Re: Re: Non-supportable

        So can I use your quote every time Mike tries to push down Rupert Murdoch? "Mike, Rupert has way more money than you do, so he probably knows more than you too, so stop talking about it". Yeah, good logic.

        Actually, as a billionaire, it just means he can be wrong many more times without having to change his lifestyle, and nobody will ever know if he was wrong or not.

         

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      Alan Gerow (profile), Dec 17th, 2009 @ 10:18am

      Re:

      You conveniently forget to mention the cost SAVINGS in not charging for the paper, such as significant staff reductions in the accounting, collections, and subscription departments, not to mention distributing and delivery (since free papers frequently distribute through kiosks and not home delivery).

      So, you remove a small bit of subscription revenue (which has NEVER even covered pure printing costs) and reduce overhead operation costs by dramatic margins (think of how many more accountants most newspapers have than actual reporters). At that point, the increased ad revenue is almost irrelevant, but only proves the success of the model over the previous subscription based model.

      And now we learn that with overhead cost reductions and increased readership, they are not only getting increased ad revenue, but now show owners are paying to stock their wares where before the newspaper had to share their income through commission.

      How at all was the old system better?

       

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    Anonymous Coward, Dec 17th, 2009 @ 8:49am

    It will be interesting to see how the London Evening Standard responds when one of these carriers inevitably begins selling the paper for profit. Hopefully, the paper's management will recognize that it won't hurt their position, but given others' reactions to people monetizing their free content, I wouldn't be surprised to see an overreaction.

     

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      Alan Gerow (profile), Dec 17th, 2009 @ 10:21am

      Re:

      If someone wants to pay a shop money for a newspaper that says "FREE" on it, then what's the problem? The person paying for the paper isn't being deceived, they're just stupid or lazy.

       

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        hates idiots, Dec 17th, 2009 @ 1:31pm

        Re: Re:

        ----If someone wants to pay a shop money for a newspaper that says "FREE" on it, then what's the problem? The person paying for the paper isn't being deceived, they're just stupid or lazy.---


        How true...almost as stupid and lazy as someone who doesn't even read where the story specifically states the SHOPS are paying for the copies, and the CUSTOMERS of the shops are getting the copies for free. The SHOPS realized that they received enough benefit from stocking the FREE papers that they were willing to pay for the FREE papers to attract more customers.

         

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    spaceman spiff, Dec 17th, 2009 @ 9:32am

    The price of newspapers

    Anyone who has been in the newspaper business is well aware that subscription fees and newsstand revenues don't come anywhere near to pay the cost of producing a paper. All profits and most revenue come from advertising. That's why freely distributed, adv-only publications such as Pennysavers are HUGE money makers. It seems to me that the Evening Standard is being very smart about this and realize that it is just as well to eat the entire production cost while increasing advertising revenues by a large factor. In the end, they come out ahead.

     

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    AnonCow, Dec 17th, 2009 @ 3:46pm

    Same goes for everything, everywhere: Animal, vegetable, mineral, individual, or corporate:

    Innovate or Die

     

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    DanZee (profile), Mar 20th, 2013 @ 8:37am

    Advertiser publications have always been proven business model

    Advertisers, as they're called, have always been a proven business model. Other industries need to adapt and find a way to integrate the "free" business approach into their profit-making activities.

    Someone in another forum commented that you can't have "free" movies, but you can. Cable movie channels need to fill airtime and will buy the rights to movies for airplay for decades to come. A lot of direct-to-video movies don't really sell many copies on DVD, but make their money selling off broadcasting rights. You could give away the movie on the Internet and still make money.

    Other industries just need to think outside the box a little more.

     

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