New Denver News Startup Discovering (Again) People Aren't So Interested In Paying For News

from the let's-try-this-again... dept

While we thought it was great that a group of former reporters from the suddenly-closed Rocky Mountain News were trying to form a new online venture called the InDenver Times, we thought it was quite unlikely that the group would actually be able to get 50,000 people to agree to pay them $5/month by April 23rd. That was the self-appointed deadline set by the group. And, in fact, as we approach the 23rd, Romenesko alerts us that the group is is struggling to even find 10,000 people willing to subscribe. That isn't too surprising. There remain other (free) sources of news, and they're trying to get people to agree to pay for a product that doesn't even exist. The fact that they've got almost 10,000 is impressive enough. That said... while the group still clings to the idea of a subscription model, they're also saying that they'll move forward even without the necessary subscribers. Hopefully that gets them exploring more reasonable business models, because $50,000 a month from subscribers isn't going to go very far.
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Filed Under: denver, journalism, news, paying
Companies: indenver times


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  1. identicon
    Anonymous Coward, 17 Apr 2009 @ 5:47pm

    Re: Re:

    The most glaring being that Google is undercutting newspapers by ripping them off. The newspapers choose to let Google link to their site.

    Google is undercutting newspapers AND it is ripping them off, it is not necessarily undercutting newspapers BY ripping them off. The undercutting is legitimate: Google's aggregation is more efficient and better than the newspapers'. Any individual newspaper could cut off their links from Google, but since they're all mostly getting their news from the same source (e.g., the AP), Google wouldn't even notice. If they ALL cut off their links to Google, Google might have a problem, but that would require unprecedented cooperation between competitors, and even if they could do it, would likely be seen as collusion or restraint-of-trade.

    Also Google does get ad revenue. What do you think all those words are on the right side of Google's site? How do you think they make money? You obviously spent a lot of time on your post, and all you did is make yourself look like a moron. Good jeeaoorb.

    Be careful before calling me a moron.

    Google is very, very careful with where it puts its ads. I was mistaken in one respect: Google now does display ads on Google News results, but this only happened four weeks ago. I missed it, apparently. Before that, the news site was ad-free.

    Why would Google have run an ad-free news site? Two reasons, both well documented here. First, Google News filters enough people to OTHER, non-Google-News properties that make Google $100M a year. Second, plausible deniability: by not making any money off the news part of the site, newspapers and news-gathering organizations couldn't easily demand a cut. After all, Google was operating the news site at a loss, right?

    I'm not sure what shifted the attitude at Google, but you can imagine they thought very carefully before they put ads on the news site. Maybe it was their victory in the book search lawsuit. Google is very cagey about where it puts those ads, especially when it's not clear what they're doing is legally legitimate. Consider this from their book search FAQ:

    We don't place ads on a specific book result unless the copyright holder has given us permission to display portions of the book and wants to show ads. When we do show ads, the majority of the revenue is given back to the copyright holder. In other words, we profit from Google Book Search ads only to the extent that our publishing partners do as well.

    There's also no ads on the image search, as far as I can tell. This is another area where they've had questions about copyright and fair use.

    Google has also been careful with advertising on YouTube, probably for similar reasons. I'm not sure how long it's displayed AdWords, but certainly Google has had to have made some money from the ads that run next to the illegitimate copy of "Never Gonna Give You Up" that's on there and has been viewed a scant 10-20 million times.

    Newspapers, even on the Web, are probably doomed one way or the other because, as aggregators, they cannot compete with Google. I don't have any problem with that, really. However, there's a little inequity here: the Washington Post makes money by aggregating news and putting ads next to it. Google (now) also makes money by aggregating news and putting ads next to it. The difference is that the Post pays the AP and reporters for its news, while Google just links to the Post.

    People don't need two levels of aggregation, though. Why should I read the Washington Post's copy of an AP article when I can read the same thing at the Podunk Times site, or from the AP site directly? I don't really care if Google links me to the Post or the Podunk Times, and most times I probably don't even notice. And a lot of times I read the auto-summary on Google and don't even click through to the full article. Who has time these days, amirite?

    What's becoming increasingly clear is that we DON'T need 1,000 different local aggregators (i.e., newspapers) to get news in the age of the Internet. They are still around, but they're gliding downward, and eventually they will disappear (we are seeing the beginnings of this).

    Maybe some will reappear in a fundamentally different form.

    Maybe they will eventually shrink enough that they can actually survive on the trickle of money they get from Google sending visitors their way capriciously.

    Maybe they will start acting as full-net-news aggregators and try to compete with Google directly (although since Google already has all the eyeballs and the ads it's gonna be hard to get into that business).

    Either way, Google is making money off of news, and the newspapers aren't. But the newspapers are the ones paying for the news right now. I just figure that's going to stop one way or the other, and then Google will have to start paying for news directly. So Google will have to take a tiny fraction of the $100s of millions it will make serving ads on news and pony it up to the AP, and Reuters, and smaller news bureaus and individual reporters. It's OK, they'll still be making money hand over fist.

    Good thing they aren't evil.

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