In Sunday’s Pensacola News Journal, editor Dick Schneider made clear the paper’s intention to start charging for access to their online articles — in essence, asking readers to buy the cow after getting free milk for years. It’s part of a larger move by parent company Gannett to limit non-subscriber access to online content, and it has good precedent. Last March, the New York Times became the largest paper to erect a paywall system, with very promising results.
Everyone agrees the current model is unsustainable, but there’s a lot of contention about the root of the problem — the so-called “original sin” of digital news. Schneider says:
There are lots of folks who think newspapers made a mistake by not charging right out of the box, but that’s revisionist history. When newspapers first started getting into the online game in a serious fashion, “free” was the new black. … [N]ewspapers watched the Napster model and went all-free, all-the-time. Looking back, that might have been a naive decision, but “free” really was the soul of the Internet.
Revisionist history, eh? Let’s look back at how the venerable Pensacola News Journal got where it is.
The News Journal began its online presence in 1996 — several years before Napster arrived — as the “Gulf Coast Gateway.” It was a portal-style site that offered, for free, a handful of featured stories and other selected content. In the early days, part of its focus was to sign up subscribers for the Gannett-owned Internet service provider “InfiNet.” There was also an entertainment guide called “inPensacola” and other co-branded web products that, for whatever reason, never quite got off the ground or were folded into later projects.
The camel followed the nose, and over the years PensacolaNewsJournal.com started offering more and more of its articles online at no charge. I remember wondering back in 2003 or so, “how can they put the entire paper online and still expect anyone to pay for a print edition?” Perhaps they saw subscription fees as something specific to a physical paper — a necessary evil that covered the cost of printing and delivering a product to subscribers’ doorsteps. With its much lower overhead, an online paper could, in theory, be entirely ad-supported.
But there were cracks in that plan. Banner advertising collapsed alongside the dot-com bubble, and most of the subsequent growth in online advertising has been in search (i.e. Google’s pocket). And while print subscribers have been declining for some time, the associated costs don’t scale down. Design, layout, offset platemaking, printing — all the same steps are needed whether it’s for 100,000 subscribers or 10,000. Gannett has tried to save money by printing the Pensacola paper in Mobile and consolidating design services in Nashville, but it’s only staunching the wound.
Another major blow came in 2005, when Craigslist launched its Pensacola site. Classified ads had been a safe revenue stream for years, and it dried up practically overnight because someone on the Internet created something that did the same thing for free.
Therein lies the problem. It’s not the Napster model of “free” that disrupted the newspaper industry, it’s the Craigslist model — people creating free platforms for users to generate their own content. It’s not that papers should have been charging for their content all this time (although, yes, that would have helped); it’s that the Internet has democratized news gathering. “Citizen journalists” have three huge advantages over institutional news organizations:
- They’re everywhere. Like agents in The Matrix, anyone with a smartphone can become a reporter when news happens.
- Their distribution mechanisms (social networks) are hugely popular.
- They work for free (because it’s not work, it’s sharing).
So how does a newspaper remain viable?
- Be simple. What the PNJ ends up charging for an online subscription isn’t all that important — $4 a month, $9 a month, $50 a year, whatever. Of the people who are willing to dig out their credit cards in the first place, most won’t haggle over a few bucks. The key is to make it easy for them. No complicated restrictions in the plans, no annoying popups that keep asking “A Few Questions” every couple of days, no technical errors — it only takes one frustrating experience to run off a customer for good.
- Be nimble. Newspapers everywhere are struggling with reducing legacy costs to make their newsrooms leaner and meaner. One of the more interesting things in Schneider’s article was the disclosure that the PNJ‘s annual newsroom budget is $3 million, not including benefits. That seems like a lot of money, considering how many writers have been laid off or furloughed into early retirement in the last few years. At a median salary of about $35,000, $3 million could support a full-time staff of around 85, which certainly isn’t the case these days. Where does it all go?
- Be good. People who aren’t paying for news can forgive a lot of bad writing. That’s not going to be the case once the paywall goes up. (I’m not necessarily referring to locally written stuff. Monday’s AP wire story about the Oscars had four typos in one Meryl Streep quote alone!) But more than just dotting i’s and crossing t’s, the PNJ needs to focus on high-quality, in-depth reporting — the kind of stuff that won’t be easily scooped or duplicated by citizen journalists.
With regard to the last point, I was actually going to suggest that the PNJ look into cloning Jamie Page, whose local government coverage is always thoroughly researched and well written. So imagine my dismay to learn he’s leaving for a job at another paper.
I have accepted a reporting position at The Tennessean, the daily newspaper in Nashville, Tenn. My last day at The Pensacola News Journal is March 11.
It has been a great ride. I truly have enjoyed my time here, and there are many people I will miss in this community.
Needless to say, the value proposition of a paid PNJ.com subscription is considerably lessened by Page’s departure. Best of luck to him — and to the News Journal.