Would the subscriptions be broken into channels—for example, foreign news, tech, sports?
Hell no. The idea is to create as much value as possible for the subscription so that people see it as the best way to consume news.
Do you think there will come a day soon when you won’t want a physical newspaper? Could newspapers just give all their subscribers a Kindle or iPad and lose the trucks and the trees?
I don’t see that day coming until costs force the issue or there is a new technology that creates a new and compelling reading experience. The current e-book readers are not it.
On a separate note, not to pile on papers, but they are getting hammered on the head once again by Groupon and Google.
Next to the Yellow Pages, newspapers and local television dominated the local ad sales force forever. It has always been a core competency. The minute they saw Groupon salespeople in their accounts, they should have immediately put together a comparable product. The same for Google local ads selling for $25 per month.
Both companies are spending a shitload of money on creating or dramatically expanding local sales forces. It’s not too late for companies like Tribune to attack both businesses, but the clock is about to strike midnight.
Do you see a viable financial strategy for legacy media to add new products? Something like searchable archives of public records?
Everything they touch should be made available in a searchable manner. Data will always have value and that value increases as the amount of data increases.
“Touch once, available to all,” should be an immutable mantra to all. Add it behind a subscription wall and you increase its value and give people a reason to subscribe. They would be stupid to offer it as a stand-alone product.
What do you think the journalism landscape will be like in twenty years? Will you still have a hometown paper? What is the feasibility of more journalism start-ups?
No idea. No reason to even guess. Twenty years is forever. And again, putting any one data type as a separate business unit is pretty stupid. Customers buy digital data in as big of chunks as they can for as little money as they can. They want to know they are getting great value even if they never touch 99 percent of it. Just like Netflix.
No one complains about Netflix, saying, “Ten bucks a month? Why am I paying for 19,900 movies and TV shows I will never watch?” They think $10 is reasonable if they get access to more video than they will ever watch. So they subscribe because it’s a unique value proposition.
News enthusiasts and others would look at $7.95 for the best news content if it was an exclusive source and there was a far higher perceived value.
What do you think of the monetization proposals that would somehow meter usage? Is that feasible?
Not a fan. It makes people calculate value and that’s a hassle that will hurt sales.
On the success of Groupon, et al.: you’re absolutely right that old media
ad sales staffs have fallen behind the curve.
Not what I said. Sales people can only sell what they have. The fault was on the part of management for not recognizing what was going on.
In many respects, the free fall of legacy media has been a
revenue problem. Old media has more readers and viewers than ever. For
whatever reason, advertisers have not followed them to the web. Why?
Not true. Advertisers have stayed with television and can’t get enough web video. Newspapers are doing a decent job of monetizing the net. It’s just that the Internet-only solutions for classifieds destroyed that business, and free Internet news hit subscriptions and, therefore, ad revenue. Those losses, combined with very high legacy costs and huge debt, turned the business upside down. Had there been no debt, the newspaper business would have had the resources to respond.
Realize that the Internet companies made the same kind of mistakes. When the bubble burst and cash flow and capital disappeared, what did the Internet companies do? They folded or they cut to the bone and killed much of their future. That opened the door for new competitors.