OPINION

How Much Would You Pay for That Online News Story?

Here’s the scoop: Newspaper reporters are about to rake in the dough all across America. We’re talking millions, easy.

It’s a shame this will only be happening in your neighborhood cineplex, because actors will be playing the reporters and the money will be heading straight for movie studios Dreamworks and Universal Pictures.

You’ll probably have to pay US$10 or more for a ticket to either watch Russell Crowe play a rumpled print guy uncovering a dangerous conspiracy of some kind or another in “State of Play,” or see Robert Downey Jr. play real-life LA Times columnist Steve Lopez in the movie version of his book “The Soloist.” This column is being written before the premiere of either film (“State of Play” opens Friday, “The Soloist” April 24), so I have no idea if the screenplays make any mention of mass editorial layoffs, newsroom buyouts, mandated furloughs, news aggregators linking to wire stories, premium content paywalls or print newspapers that have gone Web-only.

I seriously doubt it, but consider the topical value-added drama. Maybe Crowe’s character demands micropayments before he’ll tell us who murdered the congressman’s beautiful young mistress. Or perhaps Downey as Lopez issues a no-pay, no-play edict before he’ll tell his editors how a former Julliard standout who looks an awful lot like Jamie Foxx ended up homeless and playing the cello on Los Angeles street corners.

Then again, maybe that’s why nobody’s asking me to take any Hollywood meetings.

While I work on that whole protagonist/antagonist/dramatic arc thing, let me share some thoughts about what kinds of news items consumers might pay for online — if they’ll pay at all. This is apparently heading our way sooner rather than later. The latest official attempt comes from the media-savvy cofounders of Journalism Online, which plans to set up an e-commerce system that will finally allow publishers of all kinds to make money from digital content.

No Money for Nothing, No Clicks for Free

I couldn’t get much out of Gordon Crovitz, one of Journalism Online’s three cofounders, when I asked him exactly what kind of content he thinks readers will pay for after years of free milk from the news cows.

“Maybe basketball coverage works in North Carolina, but not football coverage,” Crovitz says with a laugh during a phone interview. “There will be lots of experimentation, and there won’t be a cookie-cutter approach. Different categories of news and information will have greater prospects for subscription revenues. But the big change has happened. We’ve spoken now to many, many news publishers and they’re all asking themselves — what new revenue streams can we find beyond online advertising?

“One of the advantages that publishers will find working with this news company is that we’ll be able to compare best practices and help those publishers understand what works.”

All three cofounders have shown they indeed knew what worked earlier in their careers. Crovitz can claim one of the few examples of paid online journalism that’s been successful: As the former publisher of The Wall Street Journal and executive vice president of Dow Jones, he was at the helm when WSJ Online became the “largest paid news subscription site on the Web, with more than 1 million paying members,” as it says in the Journalism Online press release. Steven Brill, another cofounder, built Court TV into must-see TV for courtroom drama junkies and an attractive target for Time Warner. Brill also published The American Lawyer and Brill’s Content magazines. Leo Hindery Jr. made his name in cable television, broadband and Web services. He’s a former president of TCI and founder of the regional sports Yes Network.

Crovitz does indeed hold up WSJ Online as evidence that some people will pay for premium news content. Then again, it’s the WSJ, a brand like no other in the journalism world, providing trusted reporting and expert analysis in a vital segment of the news sphere.

“It’s much easier to value financial or business information,” Crovitz admits. “On the other hand, if you had asked 10 years ago, ‘would people pay for ringtones,’ I think most of us would have laughed. The issue for news publishers — is there some segment that values premium access to the news enough to pay a reasonable fee for it? A lot of thought has been given to this, and not just in traditional media but digital media too. What segment would value what kinds of services?”

Another role model for Crovitz: Steve Jobs and iTunes. The Apple innovator has trained a new generation of users to pay for something they used to get for free. The business model is apparent in Journalism Online’s proposals. The company will set up a password-protected Web site platform, and consumers will be able to buy subscriptions to content for a year, a month or a day — or just purchase an individual article. Each publisher will set their own prices for the content. Journalism Online will also market annual/monthly subscriptions to give consumers access to all JOI content, with the publishers splitting the revenues.

Here’s where it gets really interesting, especially after the recent promised legal smackdown from the Associated Press to news aggregators unlawfully using its content: JOI will “negotiate wholesale licensing and royalty fees with intermediaries such as search engines and other websites that currently base much of their business models on referrals of readers to the original content on newspaper, magazine and online news websites,” says the press release.

Says Crovitz to me, when I mention the AP and top news aggregator Google News: “News sites that have a paid model find Google to be an excellent business partner. The reason is, Google wants to have access to as much information as they can, and for publishers, Google becomes an excellent way to introduce content to people, through sampling.”

That sounds much more conciliatory than AP chairman Dean Singleton, but will that tone remain when the lawyers JOI will use for those negotiations — David Boies, who successfully sued Microsoft, and former U.S. Solicitor General Theodore Olson — sit down at the bargaining table?

JOI will do the research and provide metrics to its member publishers on what’s working and what isn’t regarding paid content. “The neat thing about the online world is that everything is measurable,” Crovitz says. “I think there will be a lot of analysis that will have to happen to help build out this approach. I’m very optimistic that publishers will take the plunge, and we aim to help them.”

My Online News Terms of Service

Crovitz tells me that JOI has spoken to a lot of top publishers in both traditional and digital media — including bloggers — and hopes to launch its e-commerce platform in the fall. Hopefully, many of those publishers will still have reporters, editors, photographers and columnists to do the work by then.

Provided they do, those publishers have their own work cut out for them before the autumn leaves drop. It will be focus-group-city as they attempt to find out just how much the public will pay for a name-brand columnist; a three-part investigative series on corporate/government malfeasance; or behind-the-scenes, inside-the-Beltway political coverage. (Hollywood publicists will know the value of exclusive interviews with A-listers if the media outlet can stick it behind a paywall. That means they’ll get to dictate the terms of those interviews even more than they already do.)

Would I pay extra for some of this? Sure. But then I’m a news junkie, not to be trusted with sharp objects and operating heavy machinery. That doesn’t mean you as a publisher get to be greedy; I’m watching my pennies too, and I’m liable to do a lot of a-la-carte shopping while I look around. You might want to keep that in mind when you’re making your revenue projections.

I think my colleagues in data-dependency would pay as well, but you’d better make damn sure the content is damn good. And truly unique; give me some chance to use Web 2.0 tools to extend the conversation with the journalist who provided the content (I promise to behave and not be a comment troll). Give me some multimedia that offers different shades from the newsgathering palette. Unless you’re a columnist, be truly objective; call BS on politicians reading from message points, but don’t you dare give me the online version of cable news. As we saw on April 15, the 24/7 media universe is truly becoming a cesspool, and this is your chance to throw me a rope.

And make sure I never, ever see this content I’m paying for show up for free anywhere else on the Web. Ever. If that happens, you’ve violated my TOS, and you not only refund my money, but you lose my trust, and I’ll use the Web to narc on you.

You don’t want to see that, believe me. You’d rather see Russell Crowe in your rearview mirror than have that happen.


TechNewsWorld columnist Renay San Miguel started his journalism career with his hometown newspaper in Texas in 1979. He moved to television in 1985, anchoring, producing and reporting in Austin, Dallas and San Francisco before joining CNBC as a technology correspondent from 1997 to 2000. Following a stint with CBS MarketWatch, which included filing tech stories for the CBS Early Show, San Miguel joined CNN Headline News in 2001 as an anchor/tech reporter. He also contributed digital content for CNN.com. After his 2007 departure from CNN, San Miguel founded Primo Media and now freelances in television/online reporting and media consultation.


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