Newsday – beginning of the end for free content?
The New York tabloid Newsday is to end the practice of giving away content on the web. Precipitously this decision came on the day it was reported that a US daily newspaper, Rocky Mountain News, is to shut. Is it the beginning of the end of free content?
I blogged about the end of free content in-depth recently when I asked “Time for newspapers to start charging?”. I went through the various arguments at the time and won’t rehash here, but it is telling what has happened since I wrote.
That post was only written last Thursday, a mere eight days ago but that time elapsed feels a good deal longer.
Take a look at the headlines from the last week telling what has happened to the US and UK newspaper businesses in that short space of time.
Profits plummet at Washington Post as Gannett slashes dividend
by Staff, Brand Republic 26-Feb-09, 09:00Regional titles suffer circulation declines in second half of 2008
by Maisie McCabe, mediaweek.co.uk 26-Feb-09, 16:Trinity Mirror reports loss of £73m as revenues plunge
by Jacquie Bowser, Brand Republic 26-Feb-09, 09:00Hearst’s San Francisco Chronicle could become next US newspaper casualty
by Staff, Brand Republic 25-Feb-09, 09:05Trinity Mirror cuts 70 jobs as 50 face axe at Northcliffe
by Staff, Brand Republic 24-Feb-09, 08:50Philadelphia’s The Inquirer files for bankruptcy
by Staff, Brand Republic 23-Feb-09, 09:00New York Times Company abandons dividend to save cash
by Staff, Brand Republic 20-Feb-09, 09:00
Until today no daily newspaper had closed, but wit the Rocky Mountain News shutting more are bound to follow.
Then enter Cablevision Systems Corp which bought Newsday in May 2008 from Tribune Corp for $650m. It has since had to write down Newsday’s value by $402m.
Two things here really, clearly last May was not the smartest time for a company to enter the newspaper market. That said, considering no one quite knew how bad it was, you can call the decision to buy as unfortunate.
Cablevision had two options really. To relaunch the site and trundle onwards hoping things got better or go for the transformational option, which it plans by turning the site into “an enhanced, locally focused cable service that it hopes will become an important benefit for Newsday and Cablevision customers”.
There are no details as yet. No clues to how much it might charge, but this move is going to be very closely watched.
Newsday has started the ball rolling and it doesn’t take a genius to predict that others will follow suit.
In my post last week I mentioned the recent comments of Bill Keller, executive editor of The New York Times. He said there was a deadly serious discussion continuing within The Times about ways to get consumers to pay for newspapers’ content and they were looking at a list of options.
The headlines above from one week tell their own story. There are many more you can include from today (Nat Mags are cutting 15% of staff and B2B publisher Centaur has seen profits wiped out).
Something has to be done. Charging for content won’t fix everything. It won’t stop more publications closing, but it will give others another revenue stream and at the same time reverse a decade long trend.
That reversal needs to come for newspaper and with it a re-evaluation of the value people place on content (a significant one, I think). After all, content did once use to be king.
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