Audit Notes: Paywalls Paying Off, Digital Privacy, Murdoch

As Warren Buffett knows, when you give away your product online, it undermines the one you charge good money for in print. NetNewsCheck reports from the Key Executives Mega Conference:

Jeanny Sharp, editor and publisher of the Ottawa Herald, said the move to paid content in July 2010 was a matter of stopping the bleeding, having watched her paper’s print circulation steadily drop as readers instead turned online to pick up its content for free. She said that erecting the paywall immediately stopped the circulation drop…

The Columbia Daily Tribune’s Andy Waters, president and GM, said that for his paper, the move came down to revenue prospects. “Maybe 10% was the most we’d ever get from online advertising,” he said of his December 2010 move to paid content to build a new revenue stream. The Daily Tribune adopted a metered model allowing 10 free views per month, and despite some initial reader grousing, Waters said it has had steady digital growth since the move

And the Daily Tribune’s strategy, which in fifteen months has 9,500 paying online subscribers on a print circulation of about 20,000, was particularly smart:

He attributed the paper’s 60% conversion rate to a print/online bundle partly to the opt-out approach it took in presenting the switch to readers, who would have to call to stop their subscriptions to avoid the new paywall.

The Atlantic’s Alexis Madrigal has a very good essay on digital tracking.

Companies’ ability to track people online has significantly outpaced the cultural norms and expectations of privacy. This is not because online companies are worse than their offline counterparts, but rather because what they can do is so, so different. We don’t have a language for talking about how these companies function or how our society should deal with them.

The word you hear over and over and over is that targeted ads can be “creepy.” It even crops up in the academic literature, despite its vague meaning in this context. My intuition is that we use the word “creepy” precisely because it is an indeterminate word. It connotes that tingling-back-of-the-neck feeling, but not necessarily more than that. The creepy feeling is a sign to pay attention to a possibly harmful phenomenon. But we can’t sort our feelings into categories — dangerous or harmless — because we don’t actually know what’s going to happen with all the data that’s being collected.


Most obviously, with the machine, you have more privacy than if a person were watching your clickstreams, picking up collateral knowledge. A human could easily apply analytical reasoning skills to figure out who you were. And any human could use this data for unauthorized purposes. With our data-driven advertising world, we are relying on machines’ current dumbness and inability to “know too much.”

This is a double-edged sword. The current levels of machine intelligence insulate us from privacy catastrophe, so we let data be collected about us. But we know that this data is not going away and yet machine intelligence is growing rapidly. The results of this process are ineluctable. Left to their own devices, ad tracking firms will eventually be able to connect your various data selves. And then they will break down the name wall, if they are allowed to.

Read the whole thing.

— In the Telegraph, Peter Oborne asks “whether Rupert Murdoch is a fit and proper person to run not just a newspaper, but any British public company”:

Rupert Murdoch, the company’s founder, insists that he never had any knowledge of wrongdoing, and no doubt that is true. But he was the man at the top. He took a very keen interest in the way his British newspapers were run (a newspaperman to his fingertips, last weekend he could be seen hard at work in the newsroom as the Sun on Sunday was launched) and it was he, and nobody else, who set the culture.

We learn more about this culture practically every day. It was a culture of bullying and intimidation, where facts were distorted and lies told. It was a culture which merged the boundaries between police, media and the political class. Though brilliant in many ways, it also did a great deal to debase and even to destroy our public life. Now Rupert Murdoch, an American citizen of Australian heritage, is promoting the break-up of Britain through an alliance with Alex Salmond, leader of the Scottish National Party (they met yesterday).

This last bit is particularly bold for someone in Murdoch’s position.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum. Tags: , , , ,