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How user payment will improve journalism

Many paywall experiments will fail during the next year. That will lead to better journalism in many media companies. Here is why.

Practically all media companies in the Western world now try to introduce user payment in some form or another. And senior editors editors struggle with the same difficult question: What should be free and what should be premium content?

I know from my own experience how complicated these discussions can be. Typically a number of different considerations are mixed into the same deliberations, making it very hard to make a clear distinction. For some executives the overriding consideration is to protect the printed paper product. Other argue that everything should be free, while some are as confident that most journalism should indeed be paid for by users.

The fact is, though, that none of us really have the experience to offer a neutral judgement. We are bound by what has been the traditional business model of the newspaper industry: The really value is in the edited package.

Therefore most media companies end up with the same conclusion in this first phase of introducing user payment: What has been in the printed paper is premium!

The assumption is clear: The newspaper content is more valuable than what has been produced for the web site.

It is very easy to think in this way, of course. And if you look at most user paid media products out there, this is the basic principle regulating the difference between premium and free.

But is the assumption valid?

I would argue not.

And I am quite sure that all the experiments in user payment will prove the assumption wrong! Many attempts at selling content or introducing user payment will fail. Sales will be minimal – and that will make media executives question what they did wrong.

The reason for this is that many editors overestimate the Unique Content aspect of their product, and tend to ignore how important Unique Convenience is in making people pay for a newspaper product. Also, the real value of a newspaper is not necessarily the individual pieces of content, but how they have been put together into a package.

Espen Egil Hansen, chief editor of the hugely successful Norwegian news site VG.no, recently in a publice debate described  a surprising challenge when the newspaper prepared its soon-to-be-launched iPad app: Many newspaper articles were just too short to work well on iPad!  He pointed out how in fact many web site articles were much longer and deeper than the print articles. Since VG based its Pad app primarily on the printed paper content, this turned out to be a practical challenge.

Why do most media executives equal premium content with newspaper content? The answer in fact is simple: They assume that the same rules for valuation that they were used to from the print business also are valid in the digital businesz.

Do not ever assume that! The rules of the game are entirely different!

Did you hear me?

I will repeat: The rules of the game in the digital business are entirely different!

What will happen then?

I am sure there will be a lot of success stories. A number of them will be big surprises to all those of us who try to follow media trends carefully. However, there will also be a lot of failuresl. Many media companies will be forced to realize that people just don’t want to buy their products. And the media executives will realize two important truths:

Truth number One: Willingness to pay for content comes from much more than the content itself! If you base your user-paid digital offerings on the content alone, like many do when they just offer a PDF version of their papier, chances are that you will fail.

Truth number Two: We have to think in new ways about what constitutes Unique Value when it comes to content! Of course Unique Content is important, but primarily as one of several elements in a broader offering to the public.

And here is the big revelation for senior editors at the big media companies: They need to rethink their content strategy to fit with the new digital reality.

Now we come to the core of why I think failed attempts at introducing user payment will indeed improve the quality of journalism

The reason is this: Editors will be surprised to discover that people were not willing to pay for their content when it was disaggregated into its individual content pieces.

After this realization comes a painful examination into what readers really value.

And this is exactly the moment when new value and opportunities are being created!

Editors will realize that much of what they considered premium only had value as part of a specific content bundle in print. Once it was disaggregated and repackaged, the content lost its value. Readers had valued the convenience of having a nice content bundle delivered to their door in the format of a printed paper for breakfast. But suddenly they now had many different options to choose from in the same user situation.

If you ever thought you had unique content: Think again! Are you really sure?

What, then, constitutes unique content?

This is the really tough question. Providing good answers is hard. Yet, that is what we need to do. Realizing (as we will) that our traditional content is not sufficient to make users pay, we must try to identify the content and associated user situations that will trigger users to pay.

And here is the important understanding: What used to be perceived as having value in the printed world, suddenly may no longer have value in the digital world. Also important parts of the “free” content on the web may have great value if it is repackaged and distributed in specific ways.

The rules of the game have changed!

Depressing, isn’t it?

Maybe, but there is also a window of opportunity. The major challenge is that you need to identify content that people will be willing to pay for.

And here lies promising future for the next phase of journalism. As editors realize that readers do not automatically want to pay for their content when it is digitalized and disaggragated, they will start to search for content with unique value for readers. That will not be abundant news , which will still be financed solely by ads, but rather content that is difficult to find anywhere else.

The creative process of identifying this content will be good for journalism. It will go to the core of what readers really value and force journalists and editors to rethink how they look at their role.

It will also bring new types of content from the media companies. It might be longer, deeper or richer.  In many cases it will be extremely well structured to make it easier to distribute quickly and smartly. Probably it will to a larger extent tend to answer questions like why and how. For sure it will involve multimedia and other new story telling techniques. And it will be “made-for-share” in social networks. Much creativity will be invested in how the content is packaged and in what situations it is distributed to the users.

We will see completely new formats, set free from the physical limitations of the newspaper. Some of the formats will be longer than newspaper companies ever made before. And we will see sophisticated integration of interactive multimedia elements. In short: Journalism might be taken to a new level!

Maybe we will see journalism going in two different directions:

  • One format for free journalism. This is the event based news journalism that is designed to draw massive traffic to news sites. This journalism will be short, snappy and financed by ads.
  • Another format for premium journalism. This will be longer and more structured formats and they will be trying to answer questions like why and how. Much emphasis will be based on how to package and distribute the content to specific user situations. For this content there need to be a very strong USP – Unique Selling Point.

As the market develops, media companies probably will move resources from free to paid journalism, especially if strategies for bringing in user payment are successful. And that reallocation of resources will bring about better journalism, I think.

One thing I am sure about, though: Premium journalism in the digital future will not be the same as newspaper journalism in the past.

But I think it will bring even more value to the users.

What are your thought on this?

About the author: Experienced media manager and journalist. Enthusiastic about digital media – and eager amateur photographer. Currently Chief Communications Officer at Schibsted Tech Polska in Krakow, Poland.

Comments on this entry are closed.

  • Sunburnedzebra

    I agree we will see the majority of paywalls fail. I agree there must be a unique selling proposition for digital content. But many of us came to the same conclusions 10-15 years ago. Really! Where was everyone then? The industry — especially the journalists — is famous for being in denial. The only reason we still are subjected to 3000 word feature stories. And so it goes.

  • Olivier Bonsart

    Good post, John.
    But I think you underestimate one terrible point: people don’t want to pay for the bundle anymore, even on paper. That’s why print circulation of paid papers is declining so fast, and that’s why trying to sell the old bundle on the iPad is hopeless. When associated with home delivery service, the bundle can resist better.
    Free newspapers are doing quite well…
    The challenge online is to create new content that will justify paying for it.
    You’re right, that will lead to better journalism, and, maybe to less journalism too…

    • http://www.betatales.com John Einar Sandvand

      That’s a very good point, Olivier! I agree that the broad bundle gradually will be threatened. However, it will still take some time before it disappears, I think.
      I have written on the disaggregation of news several times here on BetaTales. Here are two of the articles:
      http://www.betatales.com/2010/08/23/aggregation-or-human-editing-what-gives-most-value-to-readers/
      http://www.betatales.com/2009/07/26/the-disaggregation-of-news/

      I would love to hear you elaborate on this issue further.

      • JCFalloux

        Nice Post John and I just want to add a commentary to Olivier’s comment : people don’t want to pay for a fixed bundle – yes and no – If we are looking at offering at our clients a copy of the print edition then yes we are definitely not answering their new needs in terms of news consumption. On the other hand, if we explore different ways in packaging content mixing text, audio and videos and on top of that personalized then we have a chance to recapture our clients. My point here is that the packaging of the content is as important as the content itself if we want to keep the reader experience alive. It is not because it is digital that we can get away with it. Packaging has value and that is why people are ready to buy applications on smartphones.

  • Leif W

    Short reflection from me as “news consumer” in 2020;
    – I want to edit my own “newspaper” – mostly delivered digital on 2screen-A3-laplet.
    -The cost of a daily “paper” will still be 2 usd
    – The content is controlled and choosed by me- fra apprx 100 vendors – organised from individual bloggers, national and international publisher/news agencies etc. Sources I have choosed, but with proposal for new content done by behaviour pattern.
    Editorial functions in the newspaper-industri will change their role, and maibee sell “sport section, culture section separatly for “1% of my penny”
    – In the weekend, I can get it on paper, with premium pricing
    – My 2 usd a day will be devided into thos 100 vendors – and I want to make sure my preferences are choosed into my newspaper.
    – All platforms are different, byt the content will be maximalised for each.
    – Micropay will happen- but it micht be a bank og financial services to organise my payment will be given my 100 “information vendors”

    The reason ? Time for scrolling, going into all different portals, getting basic gossipp or premium information yopu dont rely…. takes too mych time. Basically the newspapers editorial quality from the past will be moved to you as user!

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