Is Murdoch’s Plan to Charge for Online News Doomed?

From The Atlantic:

Rupert Murdoch announced plans to charge for all online content of his newspaper and TV empire, in what is possibly the boldest move of any media mogul to boost revenue from online news. Since Murdoch’s News Corp empire spans the globe, including the Wall Street Journal, the New York Post, Fox News and basically anything ever published in Australia ever, this would send shock waves through a barren online media landscape that is gasping for revenue streams. But will it work?


13 Responses to “Is Murdoch’s Plan to Charge for Online News Doomed?”

  1. 1 Dave Crider August 6, 2009 at 7:36 AM

    I dont believe he will get enough subscribers. There is still to many free news services out there that most will just go some where else. Though with the decline is regular newspaper sales I am not surprised to see this and I am sure if it does work others will promptly follow.

  2. 2 Hailey Cook August 6, 2009 at 9:49 AM

    Personally, this is not a surprising persuit, if he owns the rights to all of these, would you not do the same? They simply will not dissappear just because of a new charge to use it either, at least not quickly, namely because of their reputable and dependable brand names, it is likely he will see a drop in clientel, but already such online news sites such as the NYT, charge for even an online subscription, and I know first hand that people pay for it, they pay for it in the print, why not on the web? I wouldn’t necessarily go as far as to say DOOMED.

  3. 3 Kittygirl707 August 6, 2009 at 9:55 AM

    An interesting thought… I for one am completely sick of online marketing and some of the absolutely horrid ads out there. Not to mention the ones that pop in a new window despite your best efforts to not allow them to. However, a newspaper’s primary source of revenue is said advertising. For the right news source (probably NOT WSJ or Fox or the like) I would consider a nominal fee to not have to view the ads!

  4. 4 Heather August 6, 2009 at 10:47 AM

    I’m not entirely surprised at this. The media industry, especialyl the print industry, is quickly losing revenue due to changing technologies and the accessibility of free news and articles online. What incentive, then, would readers have to purchase a physical copy of the news, other than nostalgia and personal preference, when they can have it free? However, the news cannot keep losing such mass revenue. Murdoch’s proposal is anything but shocking, and is not neccesarily doomed, considering how many Americans do use online news as a one of their primary news sources.

  5. 5 James Dugger August 6, 2009 at 2:39 PM

    It’s a shame. They use to give the news away. Then again, it just may work depending on what they decide on charging.

    The news industry, not just the lack of interest in theprint industry, but also the abundance of online news sources, the competition is cutthroat. The agencies he owns already are considered reputable sources, as well as have a following of readers. So if the charge is nominal, say at the most $5 a month, that will be added money to help pay for a continued news service. If you have been paying attention, news corporations have been losing massive amounts of money the last few years.

    The quality of reporting will go down if they can’t profit from the news. Now if he tries to charge an astronomical amount, we’ll see. It all depends on the demand for his papers news.

    They could technically make money through advertisment online, but to really attract advertisers, you will need to prove you can bring millions of people to your site on a daily basis, and you would have to hope they click a link. It’s a different advertisment world, it’s not like where you can charge an upfront rate like you use too in print. I believe they go off ticks now. I also remember hearing that Television revenue has been going down because companies have been advertising less due to the invention of DVR’s and TIVO, people just fast forward comercials.

    Creativity will have to be used by not just news papers who are also online, but advertisers who need people to see their ads. A subscription online can work, but only if the price is right. Be prepared to see creative advertisments in the future. I expect to see more and more in actually Films, Movies – where the main Characters maybe drinking a specific soft drink, or smoking a speaking cigarette, or showing off the tag of a brand new Ralph Lauren Jacket, etc… They’ll think of something, or they won’t survive. Charging a subscription is an act of desperation on my part, and it just might work. Competition is strong though, so it might not. They just need a creative way to get ads seen to draw demand from advertisers to be able to make more money off those advertisments.

  6. 6 E. Speizer August 6, 2009 at 2:41 PM

    I also don’t think he’ll get enough subscribers. There’s many online publications that don’t charge for their content, so people who would normally check out the wall street journal, for example, would probably just switch to another, free newspaper rather than pay for a subscription.

  7. 7 Carolyne Abrams August 6, 2009 at 4:05 PM

    I can’t believe this hasn’t happened sooner. I do think that many people would pay to continue to get their news from the sources they always have. If you are loyal to a certain news broadcasting company, it is very difficult to switch over. I can’t imagine it would cost a fortune, but once the trend catches on, it will probably get out of hand.

  8. 8 Alejandro Cortez August 6, 2009 at 8:07 PM

    As others have pointed out, I can’t believe that it has not happened sooner. With newspaper subscriptions declining, and major newspapers laying off journalists and filing Chapter 11 because of online access to information, many have been suggesting what Murdoch is attempting for years. Personally, I don’t have a problem with selling online subscription to newspapers online. We can cut down on paper and ink used, but I am not sure about the long term ramifications of this move. It will be interesting to watch how this influences others.

  9. 9 Juan Balderas-Econ 101 August 6, 2009 at 8:41 PM

    Perhaps this will be successful for some of Murdoch’s publications. I think for more specific publications like the Wall Street Journal (which has had online subscription fees already, and successfully) will be successful. However, there are so many sources for the mainstream media like Fox News that don’t have online fees, people will just switch news sources or turn to blogs.

  10. 10 Evangelina Alvarez August 6, 2009 at 8:41 PM

    The better question is why isn’t everyone else doing it? Distributors of the SF Chronicle and such are struggling with the impact of the internet on their services. Why would people pay 25 cents for a paper when its free online. I think this is a great idea and I think it will work. Some people will find it cheaper online and go ahead and pay, while others rather have what they’re paying for in cash. I think because he is such a big media mogul he will have success and maybe set the trend.

  11. 11 Joseph Garcia August 6, 2009 at 10:24 PM

    Even though I could go to another news site, I think many of his viewers would still be willing to pay. The Wall Street Journal and Fox News are very popular, and I can see people paying for the convenience. I do see a trend coming up, though, where pretty much every big media distributor will make us pay for the exclusive and more interesting stories. I think it’s just a matter of time before that happens.

  12. 12 Larry Oppenheimer August 21, 2009 at 8:22 PM

    This is indeed an act of desperation on Murdoch’s part. Right now, journalism is struggling for its very existence for several reasons.

    One is that people have gotten used to getting their news (and music and…and…) for free. But not all news reporting is journalism. Real journalism involves extensive research and analysis, often over a period of time. No one can afford to do that without being paid, unless they are independently wealthy to start with. Consequently, newspapers are laying off reporters. TV news, with some exceptions, has never done the same level of journalism because of the pressure to deliver news as it happens, which precludes the kind of perspective only time can bring.

    It is rarely the case that one can know how much a blogger has really researched what he or she is writing about, or how qualified he or she is to be a commentator, as opposed to traditional newspaper reporters, who generally followed a particular “beat,” thus acquiring substantial information and expertise in their area of reportage.

    A second reason, mentioned by several people above, is that there is not yet a clear business model for generating revenue from writing online, yet that is clearly the place to which the reading audience is gravitating. This fact is one I am experiencing personally, having been a professional magazine writer for 25 years. The magazines never really paid well, but now they can hardly afford to pay me at all. Further, as the web has increased in importance, they have demanded additional material for web-only presentation without increasing my fee. Writing for magazines has all but ceased to be a revenue stream for me as a result, especially since my articles, like newspaper reporting, tended to be based on extensive research that I simply cannot justify spending the time on without being compensated for it.

    Even cable TV news channels are under pressure to keep people watching so that the station can sell ads, with the result that they increasingly take a tabloid approach. Witness the week-long takeover of supposed “news” stations to “cover” the death of Michael Jackson.

    Finally, journalism is suffering from the significant decrease in attention span occurring in highly developed nations. The availability of delivery media for information has grown so high that people are practically assaulted by information now. As a result, people only read a couple of paragraphs and end up thinking that boingboing is news reporting. If you look at magazines like Time or even the Economist, you will find most articles are no more than a page and a half, with perhaps one or two exceptions per issue. Not to mention how thin those magazines have gotten.

    This translates to people not getting well-rounded pictures of the subjects being presented and news being reduced to soundbite-length headlines. One editor told me (and this is an exact quote) “Anything longer than a toilet read is too long.” Only a few outlets, like The Atlantic, continue to present lengthy, well-researched, analytical points of view on what is happening in the world.

    The saddest aspect of all of this is that most people do not seem to understand what is being lost here, or to notice the difference.

    Now, I am no fan of Rupert Murdoch, and I can’t say that his outlets are always paragons of journalism, but, in this instance, he is simply trying to do what is necessary to preserve journalism. The deciding factor will be whether people perceive the for-pay scheme as providing greater value than what is available for free. If they do not, they won’t pay. This is, in essence, a marketing problem having nothing to do with news or journalism.

  13. 13 Hayden Scott December 14, 2009 at 11:30 AM

    This is just another example of how many news and media corporations have not kept up with changes in technology and consumer behaviors. New economic models are needed to address these systemic changes. One possibility might be a micro-payment scheme that charges a small fee, such as 5 to 10 cents, to read the full article, which is charged to the users credit card when a pre-set amount is reached ($5 to $10). This is much like the Fastrak system used for bridge tolls. The 10 cent stories would be higher valued, such as breaking news, and would allow price discrimination.

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