No, The Apple Tablet Won't Save Publishing Nor Will It End 'Free'

Overhype

from the basic-economics,-people dept

We’ve been seeing an awful lot of chatter in the past couple months over the idea that some sort of “tablet” will somehow “save” the media business by suddenly making people start paying for content again. We’ve yet to see any sort of analysis that explains why. Nearly all of it seems to be from journalists who are involved in wishful thinking and rarely are they able to explain the reasoning. Brian Sheehan points us to the latest in this sort of thinking, an editorial by a writer for Macworld, Kirk McElhearn, which also attacks the very concept of free, which it insists needs to end. It starts out by making the claim that the Apple tablet might “save the press from its demise” and then explains that it’s because it will end “free.” Seriously:

At the end of a failed 15-year experiment in giving away its product, the press (newspapers and magazines) has begun to renounce free. It’s slow in starting, because of the inertia of this decade and a half, but the New York Times announced recently that it would begin charging for its Website, and others are sure to follow…. But payment for Websites alone won’t be enough to change newspapers’ and magazines’ bottom lines from red to black. Apple’s tablet, however, will.

Bold claims. Let’s see if they can be backed up.

It’s time for free to end. Newspapers and magazines made the mistake, in the early days of the Web, of giving away their content for free, in exchange for revenue from Web advertising.

Wait, there are tons of companies that are making a ton of money off of ad supported content. Why is it time for that to end? Free was never the mistake of the publishing business. It was a combination of factors, such as not recognizing that they had much more competition than in the past, and they couldn’t just sit back and ignore it, but had to build out real web presences that offered more value to their communities. But few did that. And, with newspapers in particular, the bigger problem wasn’t “free,” but the fact that many of them took on staggering amounts of debt that they couldn’t repay. That’s got nothing to do with free.

In the past few years, tens of thousands of jobs have been lost, and newspapers and magazines are cutting back and folding all across the U.S…. Yet we need the press: the fourth estate is a necessary check for our government and business. As long as free thrives, the press can’t do its job correctly. Free may be good for freeloaders, but it’s bad for society. Those who want things to be free forget that there are still people doing the work they get for nothing, and those people need to be paid. As the old saw goes, there ain’t no such thing as a free lunch.

Oh goodness. Where to start. Just about everything above is wrong, misleading or simply ignorant of what’s happening, what critics are saying and basic economics. First, yes, there are many fewer jobs in traditional journalism, but that’s not due to “free,” but due to a changing marketplace. That happens. Lots of people used to be employed making horse carriages. Not any more. Lots of people used to be telephone operators, connecting callers from one to another, but then the technology made it so that wasn’t necessary any more. But telephony was better off because of it. Maybe we don’t need all those journalists in traditional roles, but who says journalism will be worse off for it? We’re seeing lots of interesting new business models developing, and many new sources of journalism.

And, while some might argue that we need “the press” (I would suggest we need journalism, which is a different thing), if that’s true, then there will be business models to support it. Demand creates supply. But there are lots of “checks” on the gov’t beyond the press — and there are some pretty serious questions about how much of a “check” on the government the traditional press has been for the most part. The idea that the press can’t do its job if “free” thrives is as ridiculous as it is wrong. The “press” has always been paid for via advertising. The cost of a newspaper didn’t even cover the cost of printing and delivery. The money was made in advertising. Ditto for television and radio journalism. None of it is paid for. It’s all “free” to the consumer. The argument that journalism can’t be done if it’s free to the consumer is laughable. Ditto for the claim it’s “bad for society.” What does that even mean? If free is bad for society then the history of the press has been bad for society.

Finally, I never understand the argument that “free” means that employees don’t get paid. No one makes that claim. No one says journalists shouldn’t be paid. We’re just saying that publications need to come up with new business models that allow them to pay journalists.

What news agencies can’t do is the added-value reporting, the analysis, opinion and in-depth reporting that we want to read to better understand, and that we need for society to thrive. It may be a coincidence, but in recent years, investigative journalism was severely lacking at a time when it was needed the most. Only when people pay for news can we have quality reporting.

Huh? Again, people have never paid for news. Arguing otherwise is pure ignorance. Also, there is more analysis, opinion and in-depth reporting going on now than ever before in history — it’s just that much of it no longer comes from traditional journalists.

To those who protest that “no one will pay for a newspaper on the Web”, consider some very successful experiments in paid online content. The Wall Street Journal charges around $100 a year for full access to its Website, and plenty of businesspeople pay for this. This is because the Journal provides the kind of news that is not plentiful; people pay for the quality of the business news and analysis that they can’t find elsewhere, as well as its timeliness.

Yes, people love to show the WSJ example, but the WSJ’s paywall has become increasingly “leaky” as its subscriber growth has slowed. Convincing new people to sign up when they’re getting plenty of free content elsewhere? Not so easy. It’s easy to call the WSJ a success today, but the likelihood that it remains that way over time? Small.

I’m betting that Apple will get it right, as far as features, interface and usability are concerned. It will also be an excellent tool for reading the news. Newspapers and magazines will be able to package their content in multimedia bundles (either as apps or something similar to the iTunes LP) that will be designed for reading on a portable screen; this won’t simply be web pages viewed on a smaller screen.

The key to hardware being successful is the software that supports it. One of the main advantages to Apple’s tablet, as far as the press is concerned, is the iTunes Store. Since Apple already has this platform to sell and deliver that content, even on a subscription basis, readers will be able to easily buy their favorite newspapers and magazines and get them delivered instantly. They’ll be cheaper than the print versions, and they’ll be a lot greener too. And the iTunes Store will be able to provide a better selection than readers can find by going to individual Websites. Whether by subscription or by single issue, it’ll be extremely simple to buy newspapers and magazines to read on the Apple tablet.

So that’s it then? Because Apple designs a nice product people will suddenly buy? Okay. Would be great if it happens, but I doubt it will. If newspapers do lock themselves up behind a paywall or only offer paid versions on these tablets, people will just go elsewhere — really quickly. And for those smart publications that understand this, every new paywall becomes an opportunity to build an even larger (free) audience, which will help support all kinds of business models that don’t involve direct payments. I don’t doubt that some people would pay for the convenience of subbing to newspapers or magazines on a tablet, but it’s difficult to look at the details and see how it ever becomes a significant part of the market in any way. You simply won’t get enough buyers for it to make a difference.

Filed Under: economics, free, journalism, newspapers, publishing, tablets
Companies: apple