Journalism

by Ima Fish


Filed Under:
paywalls



Debunking The Logic In Favor Of Paywalls

from the big-money-fail dept

This is a guest post from regular commenter, Ima Fish, and is cross posted from his own blog:

Marion Maneker over at the Big Money website wrote a piece entitled "The Weird Logic of Paywall Challengers."  He attempts to show that the arguments used by those against paywalls are illogical.  He also attempts to show that paywalls are not only a good idea but a necessity for news websites.

First, a little background.  Some internet news sites are making people pay to view content.  That's called a paywall.  You can't view the content without paying.  So far the attempts to implement paywalls have been complete failures.  For example, when Newsday set up a paywall, only 35 people paid.  After the Times instituted a paywall, its readership dropped by 2/3rds.  And because those articles are not being indexed by Google (or Bing or Yahoo), they're essentially invisible to people on the web.

So what's Maneker arguments in favor of paywalls? What errors in logic have those against paywalls made? Let's go through his points.

His first point is that even if ad revenues are back, news outlets should diversify by charging anyway.  He doesn't seem to get this, but as I explained above, paywalls kill off advertising by driving viewers and readers away.  So Maneker's argument that news outlets should diversify by relying on both advertising and paywalls fails as it is self contradictory. 

His second point is that news outlets charging "for content has always been part of its long-term strategy."  He's absolutely right that newspapers have tended to charge for content. However, that was never done for profit. Profits always came from advertising, classifieds, and obituaries. 

There were two reasons newspapers did charge.  The first was to cover the costs of publishing.  However, those costs no longer exist in the digital realm. 

The second reason newspapers charged was to show advertisers how many actual readers they had.  If a newspaper publisher simply gave away its papers, it could claim that millions of people are reading when in fact no one is reading.  People paying for newspapers is a pretty good indication to advertisers that people are in fact reading.  But in the digital realm news outlets do not need paying customers to tell advertisers how many unique people are reading.  All that information can be tracked automatically in real time.  Heck, in the digital realm news outlets can give specific information about page views and what ads are working and what ads are not.

His third point is that "central to any media strategy should be the idea of charging for some content."  Has he never listened to broadcast radio?  Has he never watched broadcast TV?  Has he never used Google, Facebook, or Twitter?  And despite being contradicted by legitimate business models, his third argument is circular.  He's essentially arguing that news outlets should charge for content because they should charge for content.  It only concludes its premise without telling us why.

Along with his third point he pulls the following assertion out of his ass, "Digital distribution should make content much cheaper--but it shouldn't make it free."  Why shouldn't it be free?  He never explains.

Hundreds of years ago the most efficient means to distribute news was to print it on paper and deliver it locally.  Times changed.  Radio came along and made delivering news in real time more efficient.  But it still lacked the newspaper's depth.  TV news had the same problem.  But the internet does not.  It has the efficiency, the immediacy, and the depth.  Because the distribution costs are essentially zero, economically speaking, there is no reason why the cost of the content should not also be free.

If Maneker's piece is any indication, the pro-paywallers' dream of making us pay for news is a lost cause.


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  1. icon
    SomeGuy (profile), 30 Jul 2010 @ 9:46am

    Re: Who doesn't love a funny TV ad?

    "people who are creative, who create transcendent works, or even derivative works, should have some way to directly benefit from the creation of those works."

    Generally, everyone here agrees with that.

    " it is the creator's problem, not societies problem."

    And to be honest, I don't see a problem with that. It's not my responsibility to pay you just because you did something. I have to be convinced that it's valuable to me. I don't pay McDonalds because they made a burger, I pay McDonalds because possession of that burger has value to me (and value to others, and so I'm competing in a marketplace against other potential consumers).

    If a content creator can demonstrate value and take advantage of a competative market place, they will be paid. If they can't do either, then they'll have to find some other way to provide for themselves. Patronage is one, a day job is another. Being paid directly for your efforts is only one motivation for any activity.

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