Fine, Let Newspapers Collude

from the just-get-it-over-with-already dept

We've heard from more than a few journalists over the last few months, thinking that the best way to save the newspaper business is for newspapers to get a special antitrust exemption from Congress that would allow them to collude and all agree to put up paywalls. The latest to join the chorus is Tim Rutten at the LA Times, and it's basically more of the same. For people who are supposed to be great journalists, you'd think they could think more than one move out, and realize what the inevitable response would be to newspapers all ganging up and putting up a paywall. The problem that Rutten, and the others before him, have made is assuming (incorrectly) that if they put up paywalls, people will suddenly, magically, want to pay. This sort of conceit is seen in a poll put together by a Canadian TV producer by the name of Wodek Szemberg. Over the weekend he set up a poll asking people how much they would pay per month for the news they read... and the price starts at $10. As Mathew Ingram pointed out, Szemberg's post is missing zero as an option (I'd argue it's also missing a lot of other numbers -- starting at $10 is incredibly presumptuous). Szemberg responded to this criticism by saying that zero isn't an option because zero will not exist for access to sites. Trust me, for many people, zero will absolutely exist as an option.

It's difficult to think of anything to say to people who think these ways, other than "good luck." The real world doesn't believe in such limitations. If the newspapers collude and come up with a pricing scheme where the lowest option starts at $10 per month -- fine. Just go do it, and then let's see what happens. Because talking about it is getting pretty silly.

But here's my guess as to what happens:

1. Smart news publications break off from the "charge 'em" pack and remain free and/or experiment with more creative business models.
2. Traffic to the paywall sites drops to ridiculously low levels.
3. Those sites realize that the revenue from subscriptions is a blip and barely noticeable.
4. In removing much of the audience, those sites also lose pretty much all leverage with advertisers, and discover that their online ad revenue drops quite a lot as well.
5. Meanwhile, remember those smart publications that didn't join in the suicide party? They're soaking up plenty of traffic, and working hard to provide more value to readers.
6. On top of that, newer startups spring up to fill in the void left by the paywall crew.
7. Smart journalists start jumping ship from the legacy papers behind the paywall to those who actually get them some public recognition (which are a lot more fun anyway).
8. Without competition from, or the legacy business structures of, the paywall newspapers, the smarter publications start bringing in both audience and revenue (not all of it advertising).
9. The paywall crew goes back to complaining to the gov't, though people start to wonder why they're still around, when there's so much useful journalism going out without paywalls.

So, go ahead. Just get it over with, so we can stop writing this post over and over again, and you guys can clear the field for the real innovators.

Filed Under: collusion, journalism, newspapers, tim rutten