If People Won't Pay A Monthly Fee For Facebook, Why Would They Pay For Newspapers?

from the simple-questions dept

We've been arguing about the long-term problems with paywalls for quite some time now, but more and more newspapers insist that they're "the answer." Of course, they seem to be asking the wrong question. They may be "the answer" to "doing something" in a desperate attempt to slow down people dropping their paper subscriptions, but they're not a long term solution by any means. Beyond the fact that limiting the ability to share or link people to your content takes away significant value, we've also mentioned that it merely opens up a huge opportunity for others to step into the market and replace you. Newspapers don't seem to think this is a real problem, but they are vastly underestimating the threat.

I haven't seen it explained quite as clearly or in such perfect terms as longterm newspaper man John L. Robinson in explaining why paywalls are like "using band aids on a bullet wound (found via Jeff Nolan). Robinson points out that young people today -- such as students -- admit that they're addicted to Facebook, and spend a ridiculous amount of time on the site. But if Facebook put up a paywall of about $10/month (not out of the ordinary for newspapers), they'd find alternatives:
I asked my class of 20-year-old Elon University students how many were on Facebook. All 33 raised their hands. Many of them suggested they were addicted to the social network. (It was all I could do to keep them off Facebook during class.) I asked how many would pay $1 a month for Facebook membership. All raised their hands.

“Five dollars?” I asked. A few dropped out.

“Ten dollars a month?” I asked. Nearly every hand stayed down.

“No one?” I said. “I thought you guys were addicted?”

A student piped up with an explanation: “Someone will invent something else to take its place that is free.”

I shared this anecdote with a newspaper executive when we were talking about newspaper paywalls. I said that if people wouldn’t pay for Facebook, they wouldn’t pay to get through a newspaper paywall.
Robinson then notes that the exec he told this to was dismissive because his students "aren't our readers anyway". But they are the next generation, and any publication that plans to have a future might want to think about what gets them interested... not what sends them running to find alternatives.

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  1. icon
    Mike Masnick (profile), 29 May 2012 @ 5:07pm

    Re:

    All this proves is that Facebook isn't valuable to most of its users. Big surprise, a free service is not perceived as valuable

    If you think FB isn't valuable to these people, you don't know any young people.

    It also proves that young people don't understand what words mean. If you're not willing to pay for your fix, then you're not addicted. Addicts go broke and beyond for their drug of choice. Is anyone on methadone to battle a FB addiction?

    I agree that it's not an addiction, but again, I think that's besides the point.

    And last I checked, the NYT stock is climbing while the FB stock... well.. you can draw your own conclusions.


    Wow. Talk about comparing apples to oranges in a very small sample size.

    The NYT is currently valued at approximately $1 billion. Even as FB's stock keeps dropping, it's still valued at more than 60x that). And since FB just came on the market, about the only thing you can conclude from that is that the IPO price was too high. Still, the market values it a LOT more than the NYT. And that's not going to change any time soon.

    Besides, if you look at the NYT stock over any significant length of time, you'd know that's a massive downward trend its been spinning in for a long, long time. I wouldn't overvalue a deadcat bounce.

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