I’ve followed the print industry to a certain extent over the past few years and want to briefly discuss business models. The newspaper and magazine are industries where the majority source of revenue is advertising. Companies like Rogers will pay newspaper and magazines for the “space” and to put their ad in. Simple beans. It was like that for decades. Then the internet came and newspapers such as The New York Times created vast websites filled with even more content. However, these free websites have failed to successful levels of advertising. Rogers doesn’t want to buy the banner “space” at the side, because data shows that only 0.0025% click on it. So when you combine loss of advertising revenue plus an additional loss of subscription revenue, you wonder how these news media companies are surviving. Subscription revenue is lost because customers realize they can get content for free online instead of paying $27.99 a year. Back to my previous point, news media companies are not surviving that well, often they are part of a media conglomerate (i.e. owns TV, radio, etc channels as well) or are owned by some private investment firm. The fact is, if there were nobody to bail these companies out, and news was their only business, they would have closed up shop a long time ago.
The New York Times recently introduced a subscription service online. I believe they are testing the service currently on Canadians only (lol). Anyways, the way it works, is you get something like 20 free articles to look at (maybe per day?) then after that it’ll ask you to log in as only paying members can view more articles. My question is who is going to do this???
1) You can find the same news story somewhere else on the internet
2) Do you really need to read 20+ articles a day (ok, I know that question is relative...)
I understand what they’re trying to do – make more money, but realistically I don’t think this is a smart move. So it seems the news media business model is continuously plagued....what can we do?
If you’re a magazine, tablet editions (e.g. iPad) of your magazine on a subscription has shown some signs of success, but the adoption rates are way too low. In addition you have to offer the user something more than just a static magazine. You have to embed videos, comments, and direct links to make the magazine experience interactive. To be honest, I’m not sure what to do but whatever they do, they better start generating some profits.
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