A Potential 'Solution' for the Newspaper Industry

By Bermel, Paul | Editor & Publisher, May 15, 2009 | Go to article overview

A Potential 'Solution' for the Newspaper Industry


Bermel, Paul, Editor & Publisher


A potential solution for newspapers to alter their declining revenues and changing business dynamics: follow the cable TV model of subscription access. Cable TV companies, owned by Multiple System Operators (MSOs), pay monthly licensing fees (anywhere from a few cents to a couple of dollars per month) to the cable TV channels (CNN, ESPN, Discovery, etc.) on a per subscriber basis, regardless of how much cable subscribers watch any channel (obviously higher viewed cable networks command higher per subscriber fees).

Why shouldn't newspapers as a whole unanimously change their own paradigm? As Alvin Toffler famously said: "If you don't develop a strategy of your own, you become a part of someone else's strategy."Isn't that what happened to newspapers with online classifieds and job search ads, when startups in these two categories shifted the playing field and so began the cascade thanks to Craigslist and Monster.com, in the advertiser supported content arena for newspapers? How It Would WorkIf newspaper web sites blocked access by Internet Service Providers (ISPs) to their online sites and permitted access only to ISPs who had a licensing arrangement with them, this would create a value proposition with consumers whom are ISP subscribers via broadband, DSL, and dialup. Passionate followers of newspaper web sites would contact their ISP insisting the ISP permit access to the newspaper web site or threaten to switch providers who did provide access. ISPs would then begin marketing their services touting that they provide access to specific, many, if not all, newspaper sites. For example, The Boston Globe, which is the latest newspaper under financial pressure of closing from its owner, The New York Times Company, has approximately 4 million unique visitors per month (as compared with approximately 325,000 daily print subscribers). Certainly there will be devoted followers of the Globe's web site, Boston.com, who will be outraged that they can no longer access the Globe's web site. Web surfers don't typically visit just one news web site, or newspaper web site; they visit any number of them. Likewise, search engines and content aggregators like Google and Yahoo to Huffington Post.com to Newser.com (some sites have virtually no original content and simply aggregate selected content from others) who scrape headlines and summaries from newspaper stories under "fair use" laws should be blocked without a licensing agreement too. Otherwise, these "scraper web sites and services" will still create an end around for newspapers blocking with ISPs. ISPs Generate Over $35 Billion in RevenueThe estimated 97 million U.S. subscribers to ISP services generate approximately $35 Billion in annual subscription fees (according to ISP-Planet.com and a special analysis) -- and none of the revenue is shared with newspapers. …

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A Potential 'Solution' for the Newspaper Industry
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