State of the Brand :: by Jason Voiovich

A weekly discussion of how branding affects the world around you.

I don’t enjoy the New York Times *that* much

Posted on | March 21, 2011 | No Comments

Jason Voiovich

Key Points:
1. The NYT paywall is another sad (and I would say doomed) attempt at providing a new online revenue stream.
2. Like many before it, the NYT is stuck in its old subscription model where it controlled its own production and distribution. In the new media landscape, it’s the cable companies, Apple, Google, and Facebook that run the show.
3. To that end, the NYT and its newspaper kin would be better advised to join ‘em rather than try to beat ‘em. By banding together, they could provide simple access packages to several publications that people would probably gladly pay for.

The New York Times is on my Firefox bookmark toolbar.

It’s right up there with the Wall Street Journal, the Economist, the Strib (for the local stuff), and links to Gmail, Indexed (one of the most clever blogs ever), AdWeek, AbleNet (my company), and Basecamp (our cloud-based project management system).

I’m going to guess NYT holds a similarly enviable position on millions of browsers.

But I’m still not going to pay for it.

Before you give me a lecture on how “capitalism works”, that there’s no “free lunch”, and that online advertising models cannot pay the bills, let me clarify. I am not at all opposed to exchanging greenbacks for something I value, but I expect those who want my money to follow the old say axiom: To sell more, make it easier to buy.

And the NYT paywall – no matter the intricacies or the 20-article limited access – is not “easy”. Neither are any of the other paywall concepts individual newspapers have tried to install in their online incarnations. The bottom line is this: If each of the online publications I read regularly installed a paywall (like the WSJ’s), I would need to log in six different times simply to scan the news.

That’s just plain silly. What’s more, I think that’s one of the key reasons paywalls of any kind have had trouble sticking. Perhaps the WSJ can get away with it. The demographics are right. Perhaps even the NYT. But second-tier publications (including our own Strib) don’t stand a chance.

This is really all about buyer behavior and much less about newspaper economics. I understand the complexity of the issue (I’m completing my thesis work on exactly this topic – there are no easy answers), but this issue of paywalls isn’t so hard to understand. Its lynchpin is habitual behavior.

Let’s try looking at the issue a different way.

What if you bought cable television stations like you bought online newspaper subscriptions? That would mean instead of the 200-300 channels you get now, you’d need to pick and choose the handful you liked. Of course, many people would (without thinking about it much) say “yes!” – “heck yes!” – to only paying for what I’d like to watch. But to put it bluntly, a few subscribers would do it, but most would opt for the easier “package”. That’s just how we’re wired. Most of us don’t have the time, energy, or patience to sift through hundreds of options.

In economic terms, by banding together, providers can be assured of a certain level of continued revenue. Without it, larger providers (ESPN, Disney, Discovery, etc) could make it, the economics simply don’t work for the smaller channels. Yes, your cable or satellite bill is disproportionately skewed towards ESPN even if you don’t watch it, but without them, the Science Channel wouldn’t exist.

Bottom line, packages are easier to buy, and no one ever believes cable television should be “free”.

But I can hear you through the interwebness – what about the Netflix model? Can’t I simply stream only the shows I want to watch along with my DVD-by-mail arrangement? Really though, it’s the same idea. Although it’s more flexible, you are subsidizing certain programming you don’t watch while others do the same for you. Most subscribers are happy to pay it.

I’m not naive enough to think instituting a system like this wouldn’t be akin to herding cats, but the industry’s outright hostility to the idea baffles me.

Case in point: Apple’s new subscription service. Put simply, if you want access to your subscribers using an Apple app (and access to its millions of iPhone, iPad, and iPod Touch users), you’ll need to give Apple its 30% cut. Seem a bit steep? Maybe, but Google is doing the same sort of thing with Android platform apps. You could have heard the grinding and gnashing of teeth from the media biz.

I think what they’re really mad about is that they no longer control the channel, but they’re still trying to act as though they do. Comcast now controls it. As does DirecTV. And Netflix. And now Apple, Google, and Facebook. Even the venerable NYT is simply another provider of content.

That’s the new media landscape. The quicker media figures that out, the better.

Related Links:
The New York Times paywall is, well, weird


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Jason Voiovich
director_corporate marketing, Logic PD
Black Belt
Caffeine Addict

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