Economics Doesn't Work In A World Of 'If Only...'
from the back-here-in-the-real-world dept
We had already explained why Walter Isaacson's "we'll just use micropayments!" model for news wouldn't work, but it seems he's still out there pitching the idea. Clay Shirky did an even better job dismantling the concept, but last night Isaacson appeared on the Daily Show with Jon Stewart to pitch the same ridiculous idea:But the really frustrating thing is that Isaacson doesn't seem to have a clue about basic economics (and, at times, news business models). For all his talk about the importance of getting good reporters "paid," he seems to have missed out on the reason we want good reporters to get paid: because they actually do good work. That means doing research to understand the topic they're talking about.
Isaacson didn't do that himself.
Instead, his whole idea is based on the wishful thinking of "if only..." If only the newspapers hadn't started by putting content online for free. Newsflash: they didn't. A lot tried to charge and it failed. Miserably. If only we had a system whereby people could pay just a small amount per article. Newsflash: it's been tried. People don't like it and don't use it. If you want to destroy your audience -- the most valuable resource you have as a publication -- it's a great way to do so. If only journalists could get paid. Newsflash: they do. Journalism has always been paid for via advertising rather than direct subscription fees (which mostly just handled the cost of printing/delivery, if that). It's particularly egregious early on in the interview, where Isaacson says:
"Who is going to send people to Baghdad if always, everything in journalism is free?"Isaacson is certainly well-respected for his work in journalism for many, many years, but how can he make that claim with a straight face. Everything in journalism is not free. It's never been free. The fact that you might allow people to read it for free, does not mean that "everything" is free. Google gives away "everything" it does for free, and is quite able to make a ton of money. Why? Because it sells the "attention" of its users. That's what newspapers have always done. The difference now isn't that they're giving content away for free. It's that they're not used to competition and haven't done a good job keeping their audience around.
But, the most ridiculous thing is that nowhere in the interview does Isaacson ever give a single reason why people would want to pay for a newspaper. Instead, he just focuses on why newspapers need money. That's not how you run a business. That's not how you come up with a business model in the face of tremendous competition. You don't focus on "we need money." You focus on giving someone an actual reason to pay. Isaacson doesn't do that at all. He just focuses on the need for money, and falsely assumes that tollbooths solve that problem.
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Filed Under: daily show, micropayments, newspapers, walter isaacson
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Ostridge
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For the Canuck in y'a
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Inflated sense of self-worth
The internet is putting a true-to-form value on all information, and individuals like Mr. Isaacson, while not wrong to look for answers, are getting caught up in a potentially inflated sense of worth. This is not to say that his achievements aren't of value, it's not to say his experience and talent aren't of value, but it is to say that his value as defined within our new online economy has either been diminished or otherwise translated.
As has been spoken to in this and other articles, it's really up to the individual to react appropriately with the changing economic times, and, unfortunately, he doesn't seem to be taking the correct paths towards helping redefine his profession. I suppose the greater question is, do we take time to correct his assumptions, or do we simply let the internet and its populous do the talking? It's a period of sink or swim for members of a variety of professions and, unfortunately, there are too many talented individuals who already have been making great strides with online journalism to worry about those who have not.
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New readership
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Hyperlinks?
Just wow...
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Re: Hyperlinks?
He's rewriting history significantly, but he's discussing Ted Nelson's Xanadu project -- where there was *some* idea of content being paid for. But, it was hardly the web, and it wasn't the way Isaacson describes.
Some background:
http://www.wired.com/wired/archive/3.06/xanadu_pr.html
"In Japan, Nelson has been lobbying for a system of transclusion that does not depend on the Xanadu software. He has baptized this system "transcopyright." Transcopyright is not a technology; it is Nelson's suggestion for a contractual solution to copyright problems. Nelson argues that electronic publishers should allow anybody to republish their materials, provided that republication takes place by means of a pointer to the original document or fragment. Just as in Nelson's imaginary Xanadu franchises, publishers of transcopyrighted documents would receive a payment every time one of their bytes was accessed."
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[Isaacson,] you moron, you don't SEND people to Baghdad! People ARE in Baghdad already! That's how blogging works! You look out of your window and blog about what you see!
*sighs* Get a clue already...
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I was hoping
The whole time watching it, I kept thinking "I can't wait to see Techdirt shred this".
Worth the wait, ha!
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Re: I was hoping
I agree with you 100%, watching it last night I couldn't help but think "Gonna be some good reading on Tech tomorrow"
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Re: I was hoping
It was hilarious when he said "if paper publishing came after electronic publishing, it would have been a great success".
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Re: I was hoping
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Boggling
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"...nowhere..does Isaacson ever give a single reason why people would want to pay for a newspaper."
I find it strange that you think publishers should give people a reason to pay, especially when what they pay doesn't amount to much.
Why can't the publisher give away the paper for free? After all, he is making most of the money from advertising.
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Re:
I find it strange that you think publishers should give people a reason to pay, especially when what they pay doesn't amount to much.
Cram, you missed my point. Sorry if it wasn't clear. The point was that *if* they're going to insist that people pay, then they should at least be giving people a reason to. Isaacson does not.
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...if only
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Re: ...if only
I'm assuming you're joking -- but of course you know that I've never said that. I've always said that the economic forces show that that's where the market is heading, and if you're smart you can adapt to it. If you're dumb, then you can whine about it. But it doesn't change the actual economics.
But I've always backed up my economics with real evidence. Not "if only."
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"Those of us who are print junkies are just praying for that."
You can pray or you can actually modify your business model. Soon, all of the "print junkies" will all die of old age. What then? I challenge you to make the news business sustainable after all of the "print junkies" are gone, just like the car companies have survived (or were born out of, rather) the passing of the buggy whip or the scribes who still found something to do after the invention of the printing press.
What we will actually see if most newspapers suck in this mindset die off and the local news sites who remain hyper local with a main focus in online news to take the share of available opportunities.
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testing
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Fair enough. But I think it is high time the newspaper industry stopped trying to charge people and moved to a free-copy model, because the dip in revenue wouldn't be significant. The model has been in vogue for years in the Middle East and in the neighborhood paper segment across the globe.
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"Who is going to send people to Baghdad if always, everything in journalism is free?"
As soon as I read that line, Michael Yon popped into mind for some reason. He provides some of the best, if not the best, on-ground coverage of the war and he's entirely reader-supported.
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> After all, he is making most of the money from advertising.
What do you mean they can't? They can and they do. Right downstairs, out there in the street, there's a whole bunch of free newspaper stands. The Onion, RedEye, some Spanish titles, etc etc.
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store
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