Should The Knight Foundation Be Paying For Startups To Put Up Paywalls?
from the might-be-counterproductive dept
Let me start off this post by saying that I'm a huge fan of what the Knight Foundation has done for journalism lately, especially with its grant program that has supported a bunch of cool startup ideas to try out new forms of journalism offerings. I've also been talking with some folks involved with the Knight Foundation about maybe helping with some of the programs they run and doing some mentoring (though, nothing is set yet). That said, I'm a bit perplexed by a recent report that the Foundation has agreed to fund a bunch of non-profits' usage of Steve Brill's paywall startup, Journalism Online. I'm not against experimenting, but I do worry that this will push some of these nonprofits towards a paywall solution that doesn't make sense. With the Knight Foundation paying the upfront fees ("It gets us guaranteed cash in the door," Brill explained), it may lead these startups to feel more compelled to make a bad business model decision by betting on a paywall, where other solutions make a lot more sense. I've spent a lot of time discussing why the economics of paywalls rarely work -- especially in the general news space, and I worry that by footing the bill, the Knight Foundation may push these startups into a decision that does more harm than good. There are lots of interesting and compelling business models out there, and I'm not sure the Knight Foundation should be picking one model that it thinks all of these startups should use.
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Filed Under: journalism, paywalls
Companies: journalism online, knight foundation
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As an example, a couple years back UCLA's student paper got a grant from them to develop an open source newspaper website system. Years later? No actual open source project, just one code dump of pretty useless code and UCLA's student paper got a new website.
Bottom line? Knight Foundation just tosses money at things without performance benchmarks are sanity. Don't expect much from them.
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KITT
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Everyone want info
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Dazed and Confused
Whenever I run into a paywall (which isn't often), Google is kind enough to list the hundreds of other similar articles. So I have to wonder why anyone would pay for news online. It's not even like I'm being routed to "amateur" news outlets as an alternative, but rather to other "professional" news articles for free. So it all just boggles the mind that anyone would think a paywall is a good idea. I would think the site development costs would drain what little profit there is from the paywall.
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This is science
If it is a failure then it can be used as another data point. If it is a success then we need to begin to change our way of thinking and understand the reasoning. I know it can be scary but we must embrace the truth wherever/whatever it is.
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Re: This is science
We already have data points for this, it's not an experiment, it's repetition.
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Re: This is science
I had the same thought recently after reading Mikes post on VODO's promotion experiment. He seemed not willing to sit back and watch the results unfold, just point out the potential bad parts. ... I'm on a horse. :)
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Fate happens
1) Knights pay startup, withdraw, and startup fails with paywall. Another data point in a long history.
2) Knights pay startup, withdraw, startup succeeds with paywall. Case study to look into
3) Knights pay startup, withdraw, startup succeeds after changing to a smarter business model. Agile business milks stupid investors.
4) Knights offer to pay, startup refuses. Doesn't make the news, but startup flies or flounders on its own merits.
So whatever. :)
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Fate happens
1) Knights pay startup, withdraw, and startup fails with paywall. Another data point in a long history.
2) Knights pay startup, withdraw, startup succeeds with paywall. Case study to look into
3) Knights pay startup, withdraw, startup succeeds after changing to a smarter business model. Agile business milks stupid investors.
4) Knights offer to pay, startup refuses. Doesn't make the news, but startup flies or flounders on its own merits.
So whatever. :)
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Why not? Paywalls have many advantages
1) Paywalls are democratic: ad supported sites are always whoring themselves out to advertisers with big pockets. Paywalls let the little guys work together to fund content creation.
2) Advertising is annoying. Yes, some paywalled sites will still offer ads, but that's not a requirement.
3) Paywalls help limit spam. Open sites may be great but spammers really abuse the openness. Even registration with CAPTCHAs is abused now by spammers. Money limits the damage they can do.
4) Paywalls let writers sell writing, not t-shirts or insider access or coffee mugs or tote bags.
5) Paywall sites owe their allegiance to their readers alone. Ad supported sites try to attract readers but can't piss off the big money advertisers. Is it any coincidence that this site's opinions are so aligned with Google and Sun/Oracle, the major advertisers?
So don't be such an auto-hater chugging the haterade all day long just because someone wants to make an honest buck.
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When Mike's right, he's REALLY right
...and so when I so 100% agree, it seems only fair that I'd get in here and say that, too.
Paywalls, when it comes to newspapers (and other forms of news dissemination) don't work. In fact, they harm. It's a faulty business model which has been tried over and over, and which always ultimately fails.
What I despise most, though, is newspaper web sites which post free content, but then it expires behind the paywall after a couple of weeks...
...in what I call the "crack dealer on the corner" approach to news dissemination.
Mike, on this (and so many other subject, truth be known) could not be more right.
___________________________________
Gregg L. DesElms
Napa, California USA
gregg at greggdeselms dot com
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Knight Foundation's Support for Sustainability
That said, we have been clear that we are not endorsing Press Plus. Indeed, in communicating with grantees, we included detailed information about seven monetization tools, including Google’s Newspass, a rival content payment system and micro-payment platforms like Kachingle and Flattr that are user-based rather than content-based monetization tools. In addition, we do not take a position on the question of pay walls vs. donation systems. These decisions need to be left to the news organizations themselves. Many technology platforms can provide both services.
Thanks for staying abreast of the Knight Foundation’s activities, a healthy dialogue cannot but help all people who care about these issues to better understand and refine their views.
Ben Wirz
Director of Business Consulting, Knight Foundation
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