Thanks to good friend Doug Hackney for sending me this excellent post about the impact of paywalls on online newspapers. Clay Shirky’s post gets at two key points:

• That whereas  the average newspaper formerly enjoyed status as a monopoly, the internet has commodified the delivery of  news.”The classic description of a commodity market uses milk. If you own the only cow for 50 miles, you can charge usurious rates, because no one can undercut you. If you own only one of a hundred such cows, though, then everyone can undercut you, so you can’t charge such rates. In a competitive environment like that, milk becomes a commodity, something whose price is set by the market as a whole.

  Owning a newspaper used to be like owning the only cow, especially for regional papers. Even in urban markets, there was enough segmentation–the business paper, the tabloid, the alternative weekly–and high enough costs to keep competition at bay. No longer.

  The internet commodifies the business of newspapers. Any given newspaper competes with a few other newspapers, but any newspaper website compete with all other websites. As Nicholas Carr pointed out during the 2009 pirate kidnapping, Google News found 11,264 different sources for the story, all equally accessible. The web puts newspapers in competition with radio and TV stations, magazines, and new entrants, both professional and amateur. It is the war of each against all.

•  That as newspapers move behind a paywall in an attempt to squeeze some revenue from their heretofore free delivery of news, their online numbers dwindle to only a highly engaged fraction of their print subscribers — or, in Shirky’s brilliant analysis, what one equates with the subscribership of a newsletter, not a mass-consumed, mainstream, newspaper. In Shirky’s analysis of the Times of London, as way of example, the online version is trending ever more Torie for this reason.

I bring this up not only because of my longstanding love for newspapers, but also my ongoing daily thoughts about the Los Angeles Times in particular. Last month I did finally call to cancel, as I’ve threatened to do so many times on this blog. I don’t like paying for the delivery of a newspaper that everyone else gets for free online, and which contains news (and even features!) that is older than the free online version, and which often lacks content that is found free online. It seems counter to common sense, and decidedly unmeritocratic. In fact, it seems like charity on my part — and I don’t feel that I owe the Los Angeles Times any charity. My sense of this deepened last month when I was given an iPad, which now enables me to read the LA Times with as much ease of portability as the print version. The final rub was when I learned that the Times was charging me something like four times (!) the rate they are charging new subscribers. That finally got me to call and howl — “I’ve been a paying customer for 23 years, but you’re discounting for new people?!?!?!” Whether or not that’s an industry standard in print marketing (and it is), it’s insulting — especially to someone who has begun to feel that he shouldn’t have to pay anything.

This entry was posted on Sunday, November 14th, 2010 at 10:35 am and is filed under Thoughts. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.