Rupert Murdoch vs. Rupert Murdoch On Free vs. Paid News Websites

from the which-rupert-is-rupert dept

Rupert Murdoch continues to shift his position on the value of "free content" but he seems to be going in the wrong direction, and not giving anyone much confidence that he knows what he's doing. You may recall that right before he completed buying the Wall Street Journal, he claimed that the WSJ would be better off going entirely free:
"We are studying it and we expect to make that free, and instead of having 1 million [subscribers], having at least 10 million to 15 million in every corner of the earth.... Will you lose $50 million to $100 million in revenue? I don't think so. If the site is good, you'll get much more."
That was just under two years ago, and his reasoning is actually quite sensible. However, after he took it over, there was apparently some back-and-forth and the Journal convinced Rupert to keep it behind a (somewhat porous) paywall. Of course, as many note, the WSJ is able to charge because of the reputation of its content (far above most other publications) and the fact that it's reporting financial info, where the direct value can be quite high to many readers.

Still, it was a bit of a surprise earlier this year when he started complaining about free content, saying:
"People reading news for free on the web, that's got to change."
And then he complained about Yahoo/Google "stealing" (he later changed it to "taking") content. Of course, that's not true. Both Yahoo and Google either link to content or have license deals. There is no "taking" of anything.

Either way, given those statements, perhaps it's no surprise at all that Murdoch is now planning to put paywalls across all his online news properties in the relatively near future. Apparently the plan will be based on the WSJ model, meaning that some stories were be available for free, but there will be severe limits. Given how many old school newspaper guys have talked about putting up a paywall, this isn't much of a surprise (though, it is still odd given his comments from two years ago).

That said, if newspapers are going to charge for online content, then let's see them go and charge. I think it will fail (miserably), but let's see him try to prove us wrong. Here's why I think it will fail:
  1. Those other sites don't have the qualities that make some people willing to pay for the WSJ. The quality isn't as good and the direct monetary benefit is not nearly as clear.
  2. Most of those other sites have much clearer (free) competition.
  3. Nowhere at all does Murdoch talk about actually giving people a reason to buy. All he's saying is that if they put up a paywall, people will pay. Sure, a few might, but it's a small number, and doing so will stagnate any sort of growth, piss off advertisers, and allow competitors to take a giant leap forward -- all in one shot.
But... if he wants to charge and thinks that these points are incorrect, we're eager to see how Murdoch gets around these issues. In the meantime, if you work for a publication that competes with a Murdoch news site, start revving up a marketing/promotional campaign about how you don't charge, and see how much market share you can build. Unless, of course, Rafat Ali is correct in his thinking, suggesting that this is all a big bluff to get others to put up a paywall. I don't believe it though... because if I'm a competitor the fact that Murdoch is going paywall, gives me even more reasons not to do so.

Filed Under: charging, fee, free, journalism, news, rupert murdoch
Companies: news corp.

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  1. icon
    BullJustin (profile), 6 Aug 2009 @ 10:02am

    A chance of making it

    Fox News, for all it's zaniness and partisanship, has built an empire on people who feel like they are excluded from mainstream society. These people tend to believe anything and everything Fox News tells them to believe. They are, essentially, fanatics for the things Fox News drives down their throats. They also tend to have a "no free lunch" mindset and as such may be more willing than the average consumer to pay for what used to be free.

    It will be interesting to see if Fox can parlay its fanatical viewership into subscriptions. After all, no one thought a fourth network could challenge ABC, CBS, and NBC, yet Murdoch managed to do it. They are a far cry form the edge thinking that popularized the Fox Network and led to all the other Fox News properties, but I wouldn't count Murdoch out just yet on this. His fanatics may see as much value in "the news other stations are afraid to report" as the typical WSJ reader sees.

    The longer a person has been misled the more strident they become to refuse admitting they were deceived. No one likes to be wrong and when one is way off base they fight harder to prove they were right than anyone else.

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