The Straight Dope On Why Charging For News Online Is A Bad Idea

from the don't-mess-with-cecil dept

Wed, May 6th 2009 12:59pm — Mike Masnick

We've had plenty of stories lately explaining why trying to charge for news online is not a very good idea, but Duane alerts us to Cecil Adams from the famed "The Straight Dope" and his take on the matter, after someone suggested that all newspapers should band together and start charging for online content. Cecil's response is so good that it's hard to know just which parts to quote. Since it covers a lot of similar ground to what we've covered in the past, we'll focus on the part that discusses TSD's own experiment with charging for its message boards. It's especially interesting because TSD's experiment "worked" in that they brought in a fair amount of money... but Cecil still thinks it's a bad idea, and explains why TSD dropped the subscription:

Impressive numbers notwithstanding, for years we couldn't figure out a way to make the SDMB generate a dime. Finally at a meeting one day, Mike Lenehan, my first editor, said, "We could charge!" My immediate thought was: I should have beaned this guy with an eraser instead of that brick. However, lacking an alternative plan, we tried it. To everyone's surprise, it worked. Several thousand people paid good money for the privilege of posting, and paid again when their subscriptions ran out. (The great majority of our visitors are non-posting lurkers, in case you're wondering about the numerical disparity; merely reading the board has always been free.) For years we pulled in a tidy sum of cash each month.

But here's the thing. It was a tidy but non-growing sum of cash. What's more, the previously steady increase in visitors flattened out. Tiring of convent life, we decided to rejoin the real world and discontinued subscriptions last August, shrewdly timing this to coincide with the current economic collapse. (Being the world's smart human is one thing; having a head for business is something else.) Visitor growth immediately resumed its upward climb.

In short, subscriptions are self-limiting. But that's only half the story. The other half is this: Your content -- that term is always going to grate -- is your own best advertisement. The Straight Dope, again, is a good example. (The Straight Dope is a good example of a lot of things.) My online archive, consisting of the totality of human knowledge distilled into convenient 800-word chunks, has always been available for free -- currently more than 2,800 columns. We make no effort to promote this, and why should we? Whenever people Google the questions that really bug them, inevitably we pop up. As a result -- I'm looking at quantcast now -- we drew 845,700 visitors last month. Chicagotribune.com pulled in 2.7 million, which, granted, is more. However, the Trib is part of a multibillion-dollar corporation that employs thousands (well, it used to be thousands; what it is after all the layoffs I hesitate to say). TSD employs a few steadfast disciples and me. Lesson: If you're producing a quality editorial product, put it out there gratis. You want the world to know.

This is why I'm still skeptical of the usual suspects trotted out as big "success stories." Let's see how it works in the long run. If you lock up your content -- even if it generates some revenue today -- you're cutting yourself off from the conversation, and making it that much more difficult to grow and be in position to reap the rewards of greater traffic in the future.

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Filed Under: cecil adams, charging, journalism, newspapers

27 Comments

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Ima Fish, 6 May 2009 @ 1:29pm

"that all newspapers should band together and start charging for online comment."

I think you made a small mistake. You meant "content" not "comment." The author of the question to Cecil clearly wants news sites to charge subscriptions "for access to their Web sites," not merely for access to comment on the websites.
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Anon, 6 May 2009 @ 1:30pm

Of course, Cecil neglected to mention
that the parent company behind Straight Dope, Creative Loafing, declared bankruptcy.
See http://blogs.creativeloafing.com/politicalwhore/2009/03/31/cl-bankruptcy-case-ben-eason-maintains-ow nership/ and other posts.
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Anonymous Coward, 6 May 2009 @ 1:36pm

Future traffic won't feed my babies today.
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J37, 6 May 2009 @ 1:43pm

Re: Future Traffic
You must feed your babies to future traffic.
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:Lobo Santo, 6 May 2009 @ 1:59pm

Re: Re: Future Traffic
You must feed traffic to your babes.
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Analyst (profile), 6 May 2009 @ 2:00pm

Kindle
Amazon's recent release of the latest Kindle may be print media's only hope for charging.
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Rob R., 6 May 2009 @ 2:00pm

Interesting...
It will be interesting to see how far that gets them. I know if a site I was at frequently (like this one called Tech Dirt that I go to) decided to start charging for the privilege of reading their witty commentary and my ability to add a bit of my own - buh bie. I'd remove the bookmark and never look back. There are too many places to get information for free to even think about paying for the luxury of one person's (or even one company's) take on things.

Hell, I get Associated Press stories for free, why would I pay one of their affiliates for it? Gogo iPhone apps!
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Mike (profile), 6 May 2009 @ 2:01pm

Re:
I think you made a small mistake. You meant "content" not "comment.

Yup. Typo. Fixed.
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Michael Long, 6 May 2009 @ 2:16pm

Premium versions
Make the news free, but charge for features.

If you subscribe you might be able to see articles earlier (Slashdot) or perhaps subscribers don't see as many ads, or never see interstitials, or maybe premium members always get articles displayed with fewer ads and on a single page instead of spread across four or five.
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TheStupidOne, 6 May 2009 @ 2:18pm

Re: Re: Re: Future Traffic
Say no to future babies, end traffic today
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TheStupidOne, 6 May 2009 @ 2:21pm

Experiment Time
Tech Dirt should prove that charging for content will only cause problems. Set up a pay wall and then write about how much money you are bringing in!
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Tgeigs, 6 May 2009 @ 2:26pm

Re: Re: Re: Re: Future Traffic
God I hate trafficking future babies. They always die of heat exposure in the back of the time truck.
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Anonymous Coward, 6 May 2009 @ 2:28pm

Anti american
What about the anti-trust laws? Doesn't this amount to communism?
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Pangolin (profile), 6 May 2009 @ 2:28pm

Getting paid for content
I know how TechDirt makes some cash - the insight community. What about TSD? I guess the question is - short of advertising - how does one go about monetizing content?
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BobinBaltimore (profile), 6 May 2009 @ 2:51pm

News Costs Money
The comparison of niche microsites with general (and much, much larger and broader) news, information and media sites falls flat just about on its face. For many of the niche sites, the real content is that provided by users (welcome to Web 2.0 and UGC). For the vast majority of for-profit media sites, the desirable content is that which takes thousands or millions of dollars to produce. "The News" is not an ethereal presence that just exists...it is something that is made by people, most of whom are paid to do so. So, the question needs to be asked: why should The News be free? There's nothing to prevent people from getting their information from free sites. But what will happen (and kinda already has) is that consumers will realize, slowly but surely, that the quality and reliability of news which is free is far different (I use "different" to be kind) than The News which is created, packaged and (sometimes) fact-checked. It's not all that much of a stretch to compare this situation to Anytown, USA in 1947. News (that is, unfiltered information about goings-on in-town) could be gained at the local bar or drugstore or soda fount, or by talking over the back fence to Freda, the neighbor. Yet people still subscribed to the local newspaper. Why? Because it was more reliable, better packaged, better written and contained things they could not know from their less formal, FREE sources. It's not a perfect comparison, but interesting.

All that said, anyone who knows me (which is probably none of you) knows I am about as far from a mainstream media guy as possible. So I get it: journalism is a fallacy, created too often by self-important boobs who can't see or admit their own biases, and funded by companies with their own slants. Additionally, there is the issue of the free cat already being out of the bag.

My sense is that major papers and magazines will not suddenly go 100% paid. Rather they will go back to (or create anew) a teaser model where some content is available free, some is roadblocked, and unique online features are created to draw people to sites. What is clear is that online advertising as a sole or even majority piece of revenue has been largely shown to be untenable for all but the most modest of organizations. Changes are already a-coming.
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Anonymous Coward, 6 May 2009 @ 3:32pm

Re: News Costs Money
BobinBaltimore,

I get all my news for free and I always have. I really don't see that changing anytime soon.

Many news companies actually broadcast the news unencrypted over the air via radio waves. All you need is an antenna and a TV, radio, or computer with a tuner.

Cory
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The infamous Joe, 6 May 2009 @ 3:39pm

Re: Re: Re: Re: Re: Future Traffic
Are you sure it's not radiation from the flux capacitor killing them off?

Worst case scenario: Put them into Mr. Fusion and go back and warn yourself about the dead babies! On noes!!!11!! Time paradox!
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The infamous Joe, 6 May 2009 @ 3:42pm

Re: Kindle
I would agree with you if they were giving away Kindles.

Reducing the price of a $490 e-book for signing up for a news subscription is epic fail of the worst kind.

If you can't sell your subscription at cost-- what the hell makes you think pushing a expensive gadget into the mix is going to help anything?

Craziness, I tell you.
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The infamous Joe, 6 May 2009 @ 3:43pm

Re: Premium versions
Wait.. you still see ads?
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Fentex, 6 May 2009 @ 4:21pm

Having read that article I think the success mentioned when first trying charging (that worked but kept only a static audience and did not grow) was the established community finding they wanted access to what they valued enough to pay when a charge was introduced.

But no new arrivals were willing to hurdle the barrier of charging to find the value.

So I think Cecil Adams was right to abandon the short term profits as it was forming a sinking lid. People would eventually leave and no new comers would add value, his site would have died a long and agonishing death if it continued to charge.
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Anonymous Coward, 6 May 2009 @ 7:23pm

Re: Re: Kindle
The Kindle will make libraries obsolete, in the year 2200. Future babies rejoice!
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Anonymous Coward, 7 May 2009 @ 1:29am

The Kindle is an oversized paperweight soon to be filled with useless unreadable expired DRM content.

GO TO HELL NEWSPAPERS AND KINDLE.

Only a SUCKER buys into this crap.
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lulz, 7 May 2009 @ 4:32am

Re:
Agreed
I like reading real books, not a screen.
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Anonymous Coward, 7 May 2009 @ 6:52am

Re: News Costs Money
"The News" is not an ethereal presence that just exists...it is something that is made by people, most of whom are paid to do so.

No, the people who make the news are usually not paid to do so. Newspaper reporters just report on it, leeching off the actual newsmakers.

So, the question needs to be asked: why should The News be free?

Indeed, why should it? When are reporters going to start paying for the news they cover?
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Anonymous Coward, 7 May 2009 @ 8:20am

Re: Re: Premium versions
Apparently, he's still using IE6...
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old rang, 7 May 2009 @ 10:07am

Re: Re: News Costs Money
News may cost money. The problem is, 95% or so, of media content, is NOT NEWS...

It is created opinion (do YOU REALLY believe that those insipid polls reflect actual events? or. are they managed, deliberate bending of data? e.g. a poll says 60% Americans support Obama.. 75% Democrats, 10% Liberals 15% Republican? That poll was taken when 'working Republicans were 'working'. Non-working Obama Acorners were not. Yet, even then, Obama lost a large percentage of his own base!! (Numbers only slightly off, recent poll, and MY margin for error is less than theirs!))

Until media starts REPORTING NEWS, not spewing anti-anyone opinions, distortions, and days of filler instead of reporting fact...

They will continue to lose audience to blogs, who, frequently have more bias than the radical left media.

I ceased depending on the entertainment 'news' media, decades ago. The only thing they stand for, is freedom of liberal speech which says 'we can lie' and it is good. If you disagree with us, WE will libel, slander, create smut and other charges against you! There is nothing wrong that, since WE are liberals. But don't you dare. If you find worse sins that we do, well, we are allowed. You are not.
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Andrew Moffat, 7 May 2009 @ 7:42pm

The Musicslu Model with sponsors can work for the online news distribution business too. http://musicslu.com/blog/?p=9
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