Low pricing and advertising revenue brought news to the American public175 years ago. With little variation, it’s the news model we’ve had for almost 200 years. Today, the same funding model threatens to take away news on paper completely.
“No more free content. The Web has become the primary delivery mechanism for quality newsrooms across the country, and consumers will have to participate in financing the newsgathering process if it is to continue. Setting the price point at free — the newspaper analyst Alan D. Mutter called it the “original sin” — has brought the industry millions of eyeballs and a return that doesn’t cover the coffee budget of some newsrooms.”
What’s ironic about Carr’s column is that if it were written when his industry last restructured its economic model (175 years ago), he would have been panned for the exact opposite reason it’s being criticized for today. Specifically, that an industry-wide price floor would have limited an enterprise’s profitability in an emerging marketplace. The rise of the penny press was, after all, facilitated by frustration with the newspaper industry’s elitist business strategies in the early years of the 19th century. Prior to that, news – if you could call it that – was subscription-based and cost 6 cents a pop.
Competitive pricing made the newspaper industry. As a larger swath of the population could afford to consume news, they did so, passionately spawning new forms of journalism that covered a variety of topics and interests.
That model is what led to the competitive nature that exists between today’s newsrooms, which, as news blogger David Cohn explains, would make Carr’s proposition impossible:
“I wonder if given the choice to go back in time whether Carr would change all this. Would keeping people ignorant and disengaged be worth saving the newspaper industry (or any industry)?
Putting aside that Carr’s dream would never happen (most newsrooms are cultured in scoops and competition, not collaboration), I think it is fair to say that mankind is better for having had access to this information for free.”
A nice thought. But a ‘greater good’ philosophy doesn’t drive an economic model, as Cohn seems to argue in his case for free online news. Capitalism has never been and never will be that charitable. Advertising revenues and low-charge fees were business decisions first and foremost.
But the fundamental argument Cohn makes–that societies are better off when more people have access to reliable information–should strike a chord with anyone who has followed the slow demise of newspapers. In very real terms, a major source of the most reliable kind of information is at risk of becoming obsolete. If this is the case, why should the existence of such an information necessity depend so heavily on the free market? It’s not entirely dependent, of course. Publicly-funded radio and television outlets have long been a trusted source for news. Recently, non-profit organizations like voiceofsandiego.org and ProPublica have garnered attention for their approach to funding via charitable endowments.
One can’t help but wonder if perhaps the model for sustaining journalism all these years was simply flawed from the start.