In Which I Debate A Media Mogul Who Insists It's Crazy To Give Content Away For Free

from the more-opportunity-for-me dept

Tue, May 15th 2012 2:53pm — Mike Masnick

Last week, I went on PBS Mediashift's podcast to debate media mogul Steven Brill about the power of paywalls. Brill runs Press+, one of the first companies that built a business around setting up paywalls for publications. They focus on NYT/FT-like "metered" paywalls, where you get some content for free, but if you hit a certain number of pages, you're locked out unless you pay. Brill, whose company had to sell out to a much larger player recently (suggesting it's not as successful as he makes it out to be), insists during the episode that there is no way to make money giving away journalism content for free, and insists that advertising is no way to make money. You can hear our debate starting at around 18:45 on the podcast:

There was a lot more that could have been said if we'd had the time, but I found a number of his arguments bizarre. The internet represents a huge opportunity to grow and expand a business -- yet he's celebrating the fact that the sites who agree to put up the giant padlock he's selling are "only" losing a little bit of their traffic? This is the time to be investing in and growing traffic, because as soon as free competitors come along, and people realize they don't need to pay any more, what will these sites have left? They'll have less traffic, less advertising and less subscription revenue. That's no way to invest in the future.

Separately, there was a nonsensical story about a journalism student who might get hired for a publication, but if that publication gives away its content for free, she can't pay her rent any more. I have no time for arguments like that. If she got hired, she has a salary. If a publication is giving away content for free that doesn't mean it makes no money or has no business model. Arguments like that suggest someone who has no real argument.

I am sure that the publications -- mostly regional newspapers -- that are using Press + are successful in slowing the rate of churn. Some paper subscribers probably agree to do a bundled package for the time being, getting paper and digital access. But it's not a long term solution. Perhaps for people of Brill's generation, it makes sense, but I don't know many people under 40 who subscribe to a local newspaper any more. There's more and more info available for free online. And there are growing opportunities to provide more such info.

Advertising is a tough way to make a living, but no one says it's the only way to make money online. There are lots of creative ways to make money online that don't involve pissing off your userbase and limiting what they can do. When you do that, you make the content that much less valuable, and that's no way to run a business.

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Filed Under: journalism, mediashift, paywall, pbs, steven brill
Companies: financial times, new york times, press+

34 Comments

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Richard, 15 May 2012 @ 2:56pm

So radio and tv stations can't possibly be making any money?
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- Mike Masnick (profile), 15 May 2012 @ 3:10pm
  
  Re:
  So radio and tv stations can't possibly be making any money?
  
  He claimed that TV news only made a tiny bit of money for a short period of time.
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RD, 15 May 2012 @ 3:14pm

An Obvious Thief
Pirate Mikey and his Freetarding kool-aid drinking thieves just want everything for nothing, they would never pay to see anything like that Avengers movie. This is just an attempt to paint anyone who disagrees with the same broadbrush. If you don't use DRM or paywalls, no one would every pay for anything. No one would create if they couldn't get paid for it. Copyright is the only enabler of creativity.

/didIdoitright?
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- rubberpants, 15 May 2012 @ 3:20pm
  
  Re: An Obvious Thief
  You forgot that Mike is a lobbyist.
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- ToFit, 15 May 2012 @ 3:29pm
  
  Re: An Obvious Thief
  So there was no creativity before copyright....hmmmm... How was the wheel invented? How did we leave the caves?
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  - kyle clements (profile), 15 May 2012 @ 5:42pm
    
    Re: Re: An Obvious Thief
    If there was no creativity before copyright, how was copyright created?
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    - Watchit (profile), 15 May 2012 @ 10:29pm
      
      Re: Re: Re: An Obvious Thief
      Copyright has existed since the beginning of the universe! which would make it about 6000 years old, so there :P
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- martyburns (profile), 16 May 2012 @ 4:27am
  
  Re: An Obvious Thief
  /dididoitright
  
  no.. its 'amidoinitright'
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Jesse (profile), 15 May 2012 @ 3:27pm

In Which I Debate A Media Mogul Who Insists It's Crazy To Give Content Away For Free

At first I read that as "media muggle," as in a Harry Potter muggle.

I like that better. Those who don't understand "free" are muggles.

Kind of ironic, though, when you consider J.K. Rowling's views.
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testcore, 15 May 2012 @ 3:39pm

Embed mildly broken
When viewing this article's page in Chrome, the embedded video appears with the text, "unavailable. The content you are attempting to play was not found." On the homepage, the embedded video appears and plays as expected.
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- The Original Anonymous Coward (profile), 15 May 2012 @ 4:05pm
  
  Re: Embed mildly broken
  I saw the same message but when I signed in to Techdirt, the video appeared. Coincidence?
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  - Anonymous Coward, 15 May 2012 @ 5:03pm
    
    Re: Re: Embed mildly broken
    Welcome to techdirts Paywall!
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    - The eejit (profile), 16 May 2012 @ 1:40am
      
      Re: Re: Re: Embed mildly broken
      Hey, at least you only have to giv e ausername and password. I hear Universal are trying to buy souls with kittens and pink unicorns before you can create for them.
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  - Anonymous Coward, 15 May 2012 @ 6:46pm
    
    Re: Re: Embed mildly broken
    It's a video?!?
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Pjerky (profile), 15 May 2012 @ 4:56pm

One thing that I have been wondering for awhile now is how a new journalism site can get started and get moving quickly. Lets assume this new site has high quality content that people want to consume. You use this content (like Techdirt does) to add value to other things that you do charge for (advertising, early access, goodies, etc). That is all well and good. But I would be willing to bet that even with great content it would take awhile to build up the regular readership you need to survive on the revenue.

Obviously it has been done many times before. But I would really like to know more about how Techdirt got started and how others can jump in and do the same. And yes I know that it isn't as simple as superficial copying of concepts.
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- Anonymous Coward, 15 May 2012 @ 6:12pm
  
  Re:
  I have no suggestions for online, but as a former newspaper reporter, I can tell you that it takes a long time for papers to build up readership, too. And a lot of them do start by giving their work away for free (or almost free) for a long time before advertising. The investment is not an instant payoff.
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  - Anonymous Coward, 15 May 2012 @ 6:13pm
    
    Re: Re:
    Er, before *charging. Sorry!
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- robin, 15 May 2012 @ 6:14pm
  
  Re: Journalism?
  ...how others can jump in...
  
  Think laterally imho:
  
  http://stdout.be/2012/05/04/fungible/#summary
  
  In this period of disruption and transition, it's not absolutely written that 'journalism' is writing news stories.
  
  Information that's useful to me comes from wherever I find it, thus it is serving an old purpose: keeping me informed, interested, buying, voting, discussing, thinking, etc etc.
  
  At a not unadvanced age, I'm well informed, buy constantly yet subscribe to no journals.
  
  If I am well served, attended to and enticed, your business's bank account is well served, but I believe that you (the business not you Pjerky :) ) must convince me. Efforts to coerce me will end in fail.
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Anonymous Coward, 15 May 2012 @ 5:29pm

Here's you a clue. NYT paywall can block all they want when they have shown the pages or whatever is the trigger. I don't care. Other than the rare editorial or rare article there is nothing in the NYT I want. I don't live local. Their ads if I were to see them, their weather if I were to see it, none of it would apply to me or have any interest. If and when I ever hit that paywall, I'll just grab up the title off some site that referred to it, feed it into the search engine, and an equivalent article comes up from somewhere else.

Yeap, I can see how the paywall really really works well. They manage to block my eyeballs from seeing their product, ensuring I go elsewhere with ease, to find the same material from someone else. Sure brought a lot of income into their pockets for all the money they spent making it, uh?

I would suggest they quit the tease and block it completely to any and all that don't pay. Maybe it will force them into bankruptcy a bit faster.
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- Jewell/Quepea (profile), 16 May 2012 @ 4:00am
  
  Re: Paywall Sarcascm
  Love the sarcasm in this comment. Though NYT is trying really hard to justify existence as a business. This is an attempt to force feed by bating with rotten carrots. Sounds like an oxymoron to me.
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pyro, 15 May 2012 @ 6:07pm

"There was a lot more that could have been said if we'd had the time"

No. There was a lot more that could have been said if the show owner would have at least attempted to moderate all sides and give everyone who wasn't Steven Brill a decent chance to talk.
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- Beta (profile), 16 May 2012 @ 7:03am
  
  Re:
  I agree. Brill interrupts constantly, even when he has nothing to say, and doesn't address the points where he's proven wrong. A person who works that hard to disrupt the debate usually doesn't have a leg to stand on.
  
  (And I love the part at 31:30 when he boasts that his seminar is "hard to get into".)
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Anonymous Coward, 15 May 2012 @ 6:09pm

Seems like the debate was won when it was pointed out that their system was thriving in the real world and you floundered around in your hypothetical revery.
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- Anonymous Coward, 15 May 2012 @ 6:19pm
  
  Re:
  ...Thriving? Really? Please point me to a paper with a paywall that hasn't considered bankruptcy or a buyout in the past 5 years.
  
  The old industry is in trouble, no doubt. Yet online sites have sprung up all over the world delivering content people want for free and somehow also making ends meet. The very fact that paywalls are being considered makes it clear that the basic business model of most old-school publications needs a serious overhaul.
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- Anonymous Coward, 15 May 2012 @ 6:50pm
  
  Re:
  You missed where Brill had to sell his paper because he wasn't making enough money with the paywall....
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  - Anonymous Coward, 15 May 2012 @ 7:55pm
    
    Re: Re:
    Oh yeah...because success is guaranteed with any business, right?
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    - The Groove Tiger (profile), 15 May 2012 @ 8:36pm
      
      Re: Re: Re:
      Extra! Thriving doesn't mean success!
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Bengie, 15 May 2012 @ 8:40pm

Redhat
Redhat sell Linux.. for free.. And they're a billion dollar company.
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Greevar (profile), 15 May 2012 @ 11:46pm

He just doesn't get it.
This guy is stuck on the idea that the content is what they're selling and if you're not controlling access to that content you can't bring in revenue. That's just silly. He didn't seem all that willing to listen and just rebutted with all the misguided counter-arguments that have been refuted already. This guy has no idea what he's selling. He's also ignorant of the fact that, like Mike pointed out, people will leave you for free content. It's vain (not to mention stupid) to think that nobody else can do what you do. If anything the internet has made clear, there is no such thing as unique and scarce content. People everywhere make content just for the love of content. There are journalism sites with free content, journalist blogs, and on ad infinitum. If you're charging for what other people give away, you're putting yourself at a disadvantage.

I've been a regular reader at TechDirt for several years now and they consistently provide me with content I find worth reading and it sparks some really great debates. I haven't spent any money on the site myself being of very meager means, but I can see that you can very much give away your content if you provide goods and services for sale that make the free content you provide have even greater value to the readers. Mike has formed a loyal and supportive community around the free content he provides. He then offers the community that he works so hard to maintain things that make the free stuff even better.

He's laid the foundation for a viral community that he can leverage as a source of revenue. The content is the lure that brings the readers in and other things that make the content more valuable to them is the hook. Free content spreads like wildfire and more exposure is always good. Had he made his model that of a paywall or metered, he would have hindered the viral nature of this community and it would likely be much smaller. It would likely be less profitable as well. Mike has rightly understood that the content is his advertising, his calling card, his bullhorn on the street to get the attention of potential readers. He also knows how to make money from enough of those readers to make a successful business.
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izzitme101, 16 May 2012 @ 1:34am

Brill, whose company had to sell out to a much larger player recently (suggesting it's not as successful as he makes it out to be), insists during the episode that there is no way to make money giving away journalism content for free, and insists that advertising is no way to make money.

Did anyone inform google?
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- Anonymous Coward, 16 May 2012 @ 9:09pm
  
  Re:
  Did anyone inform Techdirt and CNet?
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Judge, 16 May 2012 @ 7:32am

I subscribe to the NYT online and will probably keep doing so. When I was a kid, we were the only family on our block to get a newspaper. I seriously doubt that newspapers were ever read by more than 25 or 30 percent of the population in the last 40 years. Even twenty years ago, everyone got their news from Radio, TV or a weekly like Time or Newsweek. Now everyone 'reads' newspapers online, or on sites that use newspaper content like Associated Press content. So what if newspapers shrink back to only 10 or 20 percent of the population?
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Gerald Robinson (profile), 16 May 2012 @ 11:11am

Pawall nonsense
Press + reminds me of the California Gold Rush. Almost all of the prospectors died broke. The guys who made out sold them food and jeans (Levis). Except they are like the saloons; they sell stuff that (in the long run)is bad for their clients and makes them objectionable to many folks.
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Anonymous Coward, 19 May 2012 @ 11:34pm

I loved the post but the argument on air by Mike Masnick was not that convincing. I cringe every time he brings up selling t-shirts. That might be a very valid way to monetize content but to the average person I'm guessing it comes off as hokey/hippy dippy and as conservatives have taught us there is nothing worse in the world than a liberal "hippy".
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