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Posts Tagged ‘paywalls’

The recession distracted us from the disruption

Posted in Mobile media, Online media, Print media, tagged , , , , , , , , , on October 22, 2012| 1 Comment »

Anyone remember when “disruptive innovation” was the focus of discussion about the future of the newspaper industry? It seems like ages ago, but it has been just six or seven years. A Nieman Journalism Lab interview with Clay Christensen of the Harvard Business School has brought the phrase back in recent days. For those who don’t remember Newspaper Next, Mathew Ingram at Gigaom.com aptly summarizes the idea:

“One of the classic lessons from Christensen’s seminal book ‘The Innovator’s Dilemma’ is that companies with a commanding lead in their field, whether it’s hard-drive makers or steel mills, are almost incapable of taking the steps that need to be taken to survive a technological and/or behavioral disruption — even when the danger of not doing so is blindingly obvious. In other words, even when a company can see quite clearly that a freight train is approaching or a cliff lies directly ahead, it is still almost impossible to step off the tracks or do anything other than stampede over the edge.”

For a few years, “innovation” got a big push, at least in newsrooms. Journalists, in fact, generally have done the most innovating in the business, making their news more mobile, more diverse in form.

But in the wake of the Great Recession and the ongoing slow recovery, many people in the business are focused on where they can find revenue, not on the main point Christensen had stressed, which Joshua Benton described for the Nieman Journalism Lab as:

“First, focus on the jobs that your customers are hiring you to do — and on new ones that you might be in a good position to do. Successful companies often value elements of their products that audiences don’t particularly care about; getting too much distance between those two perceptions leads to business failure.”

What is the job that people come to newspapers or any news source to get done? Ingram asks at Gigaom:

“Are readers suffering from a lack of paywalled content for which they can submit their credit cards? Probably not.”

The current focus on paywalls and how to grow the online subscription business helps the business survive, and it might even be considered an innovation if the purpose is to change the industry from one relying on cheaply acquiring an audience in order to sell lots of advertising to one that relies on creating a product that people are willing to pay to acquire — but it doesn’t serve customers. Continuing to provide the public with the same information we’ve always provided them isn’t an innovation. There has to be more.

Look at the way people use technology – and how rapidly that technology is moving. Ask yourself whether the way you do business makes sense in that world. What is the job people come to you to get done?

Christensen sounds a warning that innovation focused on customers can’t be put off for long:

“Even as the disruption is getting more and more steam in the marketplace, the core business persists, and is really quite profitable for a very long time. Then, when the disruption gets good enough to address the needs of your customers, very quickly, all of a sudden, you go off the cliff.”

10/26 UPDATE — More on the ways people use technology:

“This year, the amount of time consumers spent using mobile devices—excluding talk time—will grow 51.9% to an average 82 minutes per day, up from just 34 minutes in 2010, eMarketer estimates.

“… Time spent with print media will drop to an average 38 minutes per day this year, eMarketer estimates, down from an average 44 minutes per day in 2011. Newspapers will see a drop to an average 22 minutes per day this year, while time spent with print magazines will fall to 16 minutes per day.”

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Cheer the print-only model, but understand its limits

Posted in Online media, Print media, tagged , , , , , , , on October 11, 2012| Leave a Comment »

from the Nieman Journalism Lab
A friend who is a web editor asked on Facebook what her journalist friends think of the news that the new owner of the Orange County Register is going all-in on a print-first approach to news.

My initial response was that it was “goofy.” After letting the idea simmer for a few hours, I can substantially amend my response.

First, I applaud the reasoning being used, as explained by editor Ken Brusic:

“The new owners have decided that the way they want to proceed with a business model is to really move from solely an advertising-based newspaper model to a subscriber-based one, and in order to accomplish that — basically, what we need if we’re going to charge more — is more quality in the newspaper.”

This is no small thing. Moving to a subscriber-based model means you believe you can make money primarily from the content you produce, not from finding advertisers who want to reach your subscriber base. Beefing up the staff, then, is just putting your money where your mouth is – the exact opposite of putting up a paywall while also cutting staff and/or pay.

That said, I still think there are limitations to the model. If the beefed-up Register succeeds, I tend to think it eventually will become a niche product for a high-information demographic. If smartly marketed – and keeping a free website for breaking news and pushes to the paper or an all-subscription site is a part of that – it would not be resigning itself to a forever aging and shrinking demographic, but it almost certainly would find itself with a small one: older than average, wealthier than average, better-informed than average. Not a bad demographic to have, for outside promotional events and whatever advertisers might remain, but not a mass-circulation base.

The main reason for that I think is entirely outside the control of the Register, or any news organization, as I summarized elsewhere in a completely different context on Wednesday:

“As Jeff Cole of the Annenberg School’s Center for the Digital Future has put it, the ongoing changes (facing the news industry) are not just technological but behavioral and comprehensive, of the same order as the changes that followed the advent of television, and anyone seeking to lead a business affected by them has to understand that.”

When my grandfather was a young man, it was an absolute given that if you read a newspaper, you did it after work. By the time my father started dating a pretty, young features writer at the Columbus (Ohio) Citizen-Journal, that was no longer a given. By the time I worked a summer internship at The Phoenix (Ariz.) Gazette, that was one of the few afternoon papers left in the country, and it was on its last legs.

Why the change? Were the morning papers that much better? In some cases they may have been, but that wouldn’t explain a nationwide phenomenon, so no. The change came about purely because of changes in people’s lives. It began to make more sense to people to read a morning paper. Their afternoons maybe became busier and busier, or the evening TV news filled their information needs better than a P.M. paper because the TV news was more up to date. Whatever the reason, it was less a vote on the afternoon paper than a symptom of larger trends in society.

Similarly, newspapers today are not facing financial trouble because they are “giving away” their content online – or, if you believe that is a genuine problem, not solely or even mainly because of it. Morning newspaper circulation had been in decline before most people ever heard of the World Wide Web. The advent of the Web, then the high-speed Web, then the mobile Web merely accelerated the trend and added on the burden of advertisers having new options for reaching people.

The decline of the printed newspaper can be seen as merely part of a continuum of change in how people choose to get information, and there’s no reason to think the change is stopping where it is now. And if that is the correct view, then restricting your information to print – even a high-quality, smartly marketed product – is swimming against the tide. It doesn’t mean you can’t make a living at it, but you are planting yourself squarely where the majority of people have decided they don’t want to be. You might be able to entice some to visit, those few who highly value what you have to offer, but the day will come that you are not and never will be a mass product again. Maybe that isn’t so important to you, and maybe journalism will be better served this way, but just understand where it is you are going.

Another excerpt from what I wrote in a different context Wednesday:

“The biggest obstacle our industry faces is not the tools, which are ever-changing and seemingly ever more powerful and diverse, but whether those leading the newsrooms can accept the necessity of change, even painful change, and find ways to adapt – without letting others keep focused on what is lost and how things used to be. The pace of change, and the related challenges, isn’t likely to let up.”

The reactions my web editor friend has gotten to her post are (as of this writing) largely from the “focused on what is lost and how things used to be” end of the spectrum. There is no Ghost Dance for newspapers. What’s past is past. You can celebrate it, but you can’t bring it back.

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The paywall paradox

Posted in Online media, Print media, Writing, tagged , , , , , on September 30, 2012| 10 Comments »

In his address to the Arizona Newspapers Association, Steve Buttry summed up the argument against newspaper websites setting paywalls or pay meters (and it is just newspapers; you never hear of TV stations debating whether to charge for access to their sites). I’ll quote the part that sums up his summation:

“Most of the forward-looking paths to prosperity work better with a larger audience, and paywalls (or meters or whatever you want to call them) limit your audience. Most of the paths to prosperity demand that we reach a younger audience, and paywalls continue a model in the comfort zone of newspapers’ aging and dying audience.”

There is an argument to be made in favor of paywalls, and Warren Buffett has summed it up – become indispensable:

“Make the paper so good that I get the shakes if I don’t have it.”

This is not an outrageous theory or one new to newspapers. I have pointed before to a slimmed-down version of a Newspaper Next presentation about creating an “experience” in the news pages, the argument being that people pay all the time for an experience rather than the actual product being sold. Under the experience theory, people will seek out and buy a news product online if it gives them a good emotional jolt or something to talk about. It becomes a valuable part of the day by the effect it has on their day.

Where this theory falls apart is the way that real-world newspaper publishers are trying to keep their businesses afloat.

You cannot create indispensable stories “so good that I get the shakes if I don’t have it” if you are paying the story-creators so little that they make as little – or less – money than first-year teachers. Good stories come only from good minds, and good minds may take a first job paying that little, but they also will soon find a way to something better, and then your flash-in-the-pan indispensability departs with them.

But low pay has been built into newspapers’ current cost structure. It was the way that publishers dealt with, first, the demand for maintaining profit margins and, in the recession and crash of advertising revenue, the need simply to stay afloat. Newsrooms across the country – not all of them, but many – tried to maintain as many staff positions as they could by squeezing pay. Now they are stuck.

If you are stuck with a revenue level that won’t support filling your staff with indispensable storytellers, you need to rethink your staff and content model, slim down the staff size and build up the pay. Otherwise you resign yourself to forever being completely dispensable.

You can’t be indispensable and poorly written at the same time. In that case, Steve’s point is completely correct: You will get online subscriptions from current newspaper addicts, the people who are so used to reading you that they just can’t do without. But they will die off, and you will have nothing that non-subscribers find worthwhile, so you also will die off.

Paywall defenders could argue that there is no “prosperity” to be found in unpaid models so far, but Steve is absolutely correct that in order to survive you need to bring in new consumers, new readers, new audiences.

The most recent real example I’ve seen of this is here in Richmond, where Bill’s Barbecue recently went out of business. Bill’s was a Richmond institution. When I moved here in 2001, I saw Bill’s everywhere. I figured it had to have really good barbecue for it to be so widespread. Then I went into one near home and bought some. Lord, that was some awful barbecue. It was soupy. It smelled funny. I started asking around, and to date no one I have met in Richmond thinks Bill’s had good barbecue (everyone praises the pies, but you don’t build a big barbecue restaurant chain based on the dessert). It was skating on a decades-old reputation, frequented apparently by old-Richmonders who fondly clung to memories (although not many of them; there were two Bill’s within a mile of my house, and neither was ever busy, at any time of day). Finally, the family that owns the business decided to stop.

This is where many newspapers are. There is a base of loyal customers who are willing to pay, though they lament what has been lost in the past 10 years. But there is less and less reason for any new customers to come through the door, and to the extent there is any at all, tighter and tighter paywall restrictions cut off the potential new-customer base. At some point, publishers will feel it necessary to open the walls, but by then their product may be an afterthought, a niche publication in a universe of alternative news sources.

With or without a paywall, you can’t attract an audience when you have little worth reading.

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My ONA12 conference notes

Posted in Broadcast media, Mobile media, Online media, Print media, Social media, tagged , , , , , , , , , , , on September 24, 2012| Leave a Comment »

Following are the notes I have passed to my colleagues on the Online News Association’s 2012 conference (and for more check the ONA Newsroom):

J-Lab’s “pre-convention” sessions on Thursday produced the information I thought was most immediately useful. In one, editors from The Seattle Times and KQED talked about their efforts to create a network of community news partners. The Times’ model was low-maintenance (requiring only “1 or 2 hours a week”) and easily replicable. KQED’s was much more difficult to get going and maintain.

The Times has 55 local blogs – from neighborhood blogs of the sort like the Church Hill People’s News or the West of the Boulevard News here in Richmond to single-issue blogs on things like beer or bicycling – signed up as “community news partners.” Essentially the blogs agree to let the Times aggregate their RSS feeds; the Times’ editors have a dashboard built in WordPress to let them choose what stories they think are interesting, and the headlines (ONLY the headlines) then appear on the Times’ website, with the links pointing directly to the blogs. The partners agree to give the Times exclusive access to any photos that they get (the Times’ hope is that in a giant, breaking-news situation one of the blogs will have someone there first). The Times agrees to let the blogs do the same kind of headline-linking to the Times’ site and agrees to provide any of its photos to the blogs for free upon request (with credit given). UPDATE: I forgot to mention that each Sunday the Times publishes a page of excerpts from top blog posts.

The Times has gotten news stories – including A1 stories – that otherwise would have been missed (the Times includes a note with the story saying the information appeared first in X blog), and there is survey evidence that the partnerships have improved the newspaper’s image among local residents.

KQED’s partnerships are much more complex because the station wanted full, content-producing (audio and video, since KQED has both a radio station and a TV station) partnerships. That meant avoiding any site that advocates policy positions (the Times has no problem as long as the blog is transparent about its advocacy) and providing training to get content that meets its broadcast standards.

I think the Times model actually exposes a vulnerability that newspapers ignore at their peril. If a TV station were to seek such an extensive, low-maintenance network, it could greatly enhance its website as a community hub, build on the station’s promotional and community-engagement efforts (which already exceed what newspapers do) and effectively corner the market on community news. Assuming newspapers continue to throw up paywalls and TV stations do not, the newspaper site retreats into niche status (though the niche is elite, high-information readers), while the TV station that harnesses the blog network cements itself as the go-to place for “what’s happening now?” information.

* * * *

Amy Webb, Webbmedia Group’s Tech Trends (Storify coverage, and video of the session)

Amy’s job is to spot trends in technology and media so she can help her clients adapt to disruption. The bulk of her talk was on the broader process for how her company does that. But for ONA she devoted a lot of attention to the issue of online video by news organizations, who she says are awful at online video. The problem we have, in her view, is that we are content-oriented people, so we focus on the content, not the online experience. That is backwards of how it should be. She says you should focus on creating an online experience, not on the content. As an example she pointed to is HuffingtonPost Live: The video is extremely forgettable at this point, but the online dashboard provides a web-native experience, geared for the multitasking that people do online. She says that the video inevitably will improve, but having the best video-exploration experience puts the site in the driver’s seat.

Key quote: “Don’t replicate the TV experience.” People online don’t want to just sit and only have the video play.

Near-term trends she sees for news/content:

–“Atomic”-based news. That is “atomic” in the sense of news being broken into its component bits for better personalization. In other words, for any given story, there is a basic story for the casual reader, a version with more context for those with a higher level of interest, and an expert-level package. This is made possible by rapidly improving algorithms, such as are used by Google and Amazon, tracking the user’s history and interest.

–Algorithm-created content. This would be the automated translation of spreadsheet-based information into full sentences and paragraphs. The algorithms are increasingly sophisticated and produce better and better results. I think something like this could be huge, cost-wise, for such things as sports and cops, so you could hire data-entry people instead of writers. (10/9 UPDATE: This is a company that sells the software.)

–There’s a huge opening for verticals targeting women – but NOT “mom blogs” or “mom” anything, which is overdone and misses the majority of women. She means mainstream topics but reported with a female audience and women’s particular concerns in mind. In the bulk of news, women are an afterthought or absent, so women are hungry to see themselves reflected in the world of news and information.

–Apple vs. Android: Google has a new version of Google Maps coming for Android phones (you may recall that Apple booted Google Maps from the iPhone, with poor reviews for its replacement – one tech guy I talked to in SF says his iPhone can’t even map his home address in NYC). It’s called Google Now. She thinks it will be huge for Android and tilt the field against Apple. Quote: “Google Now will make Siri look like somebody’s high school project.”

–Wearable technology. She brought in a prototype of a purse that recharges your phone. You just drop the phone inside. There’s no plugging it in, no special place to put the phone. She says you probably also will see the same technology incorporated into clothes so that you will have a phone-charging pocket.

Longer-term trend:

–Augmented reality. You may have seen the online demonstration of Google glasses, a pair of glasses that gives the wearer a display of information about things the person looks at. She has seen similar technology in contact lenses.

* * * *

The opening day’s keynote speaker was José Antonio Vargas (Storify coverage, video), the former Washington Post reporter who revealed his illegal immigration status. His main point was an argument to stop using the term “illegal alien.” He made a good point, partly on the legal/semantic issue of it being a civil violation to be in the country without documentation, not a criminal one, and partly on the basis of this: “In what other context do we ever describe a person as illegal?” Someone who drives at age 14 has broken the criminal law but is described as an underage driver; someone who drives drunk has broken the criminal law but is described as a drunken driver; neither is an illegal driver. He advocates using the term “undocumented immigrant,” which is both more precise and accurate.

(Poynter rounds up some of the counterarguments.)

* * * *

The Friday lunch “keynote” was an interview of Twitter’s CEO, Dick Costolo. Excellent interview. (Coverage, if you’re interested, or video.) One big bit of news: Twitter is developing tools to make it easier to curate event-oriented tweets. Also, pretty much all of Twitter’s development efforts are targeted at mobile users. Tweetdeck is its desktop tool and the only thing for desktops that is contemplated. (Costolo actually referred to it as something like “Twitter Pro for journalists.”)

UPDATE: Jeff Sonderman at Poynter.org has a list of 12 bite-size takeaways from the conference, largely different than mine.

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Charging for news may carry a price

Posted in Broadcast media, Online media, Print media, tagged , , , , , , on August 29, 2012| Leave a Comment »

screenshot
It’s not at all surprising that Phoenix TV station KPHO is running an ad poking plans by Gannett properties The Arizona Republic and KPNX-TV to charge for online news (I would embed it here, but embedding has been blocked on that one). What’s surprising is no other TV station in a competitive market has run such an ad (as far as I know). The ad claims that KPHO’s website has “even more” information than the Gannett site, azcentral.com, which sounds patently ridiculous on its face — but how many people who aren’t devoted daily newspaper readers know that? I know some devoted newspaper folks whose first instinct when local news breaks is to go to the leading TV station’s website, not the newspaper’s site. This ad just takes aim at that type of impulse and seeks to build on it. It is the leading argument in my mind for why no news site should be 100 percent behind any sort of paywall. If you have competition that’s free, you need to offer at least breaking news, something to keep them coming to you for free so that you can then attempt to lure them to pay for your fuller coverage and extras.

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Shortcomings of paywalls

Posted in Online media, tagged , , , , on August 23, 2012| Leave a Comment »

Mathew Ingram at GigaOm reminds everyone that even with a paywall in place online, a newspaper has quite a gap to fill if advertising continues to decline (as it likely will), and that relying on payments from readers does not equal freedom from pressure to generate traffic. Sample:

“But the biggest flaw in … (that) reasoning, I think, is the idea that having subscribers means newspapers won’t have to be driven by pageview-based tactics any more, and can just focus on high-quality journalism. This assumes that the readers who subscribe will be radically different creatures than the ones who read the content for free: in other words, they will only be interested in serious journalism and not celebrity news briefs or slideshows, whereas the free reader is driven only by their interest in those sleazy eyeball-grabbing tactics.

“I don’t think that’s the case at all. I think most readers who pay will still want just as many of those things, and will only continue subscribing as long as they get them — and without them, the paper’s subscription base may be loyal, but it will also be relatively tiny. This is the flip-side of the transformation that some newspapers like the NYT have already undergone, where the revenue provided by readers now exceeds the revenue provided by advertising. While that may seem like it would provide great freedom to pursue quality, it also means the the paper is even more beholden to a small group of readers …”

That being said, I think the industry still needs to move aggressively to build non-advertising revenue. Journalists just shouldn’t look forward to the day when finally they are free of business-driven demands on their time and websites.

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One reason people think news has no value

Posted in Online media, Print media, tagged , , on August 8, 2012| Leave a Comment »

A friend who lives in the Washington, D.C., area of Maryland says the Washington Post just got her to revive her canceled print subscription. The offer? A year’s subscription for 14 cents a day. FOURTEEN CENTS! That comes to around $715 (Update: in the middle of the night I realized I had the decimal one place too far to the right) $71.50 $51.10 a year. (Man, I can’t do math.) You couldn’t buy one reporter’s groceries for a year month for that, let alone his actual pay or any of the other costs that go into producing that paper. Paying 14 cents a day might cover the gasoline to get the paper to your doorstep. Want to know why people feel they shouldn’t have to pay to get news online? This is it: News companies continue to practically give it away in print. Why buy the cow when the farmer will deliver the milk to your door for 14 cents a day?

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Journalism is like porn, and isn’t

Posted in Online media, Print media, tagged , , on June 26, 2012| Leave a Comment »

Somehow I had missed the perfectly respectable, safe-for-work New York magazine story in 2009 about the porn industry’s Internet-driven woes and, allegedly, what the news industry could learn from them. Much thanks to JimRomenesko.com for helping me find it, because how often do people in mainstream journalism get a chance to learn about porn and be able to say with a straight face that it’s work-related research?

The quick summary: While porn initially benefitted from the Internet, over time the improving technology, bandwidth and cameras have meant that free or extremely cheap amateur video is blowing up the revenue stream.

And although the 2009 article indicates that what I guess you’d call porn industry officials felt they had some ideas for dealing with the downturn, a new article in The Atlantic indicates the problem continues unabated:

“What holds for journalism in this case holds for sex. In both cases, the competition is so broad that customers are likely to go elsewhere rather than pay. There are, obviously, exceptions in the case of newspapers — the Wall Street Journal has a profitable paywall, and the New York Times appears to be having some early success with its own.”

While I think there’s a certain amount of fun in the porn/journalism comparison, it’s a fundamentally flawed comparison. You will never find 12-year-old boys huddling in one friend’s room with the door closed to pass around a copy of the New York Times that one of them snuck from under his father’s mattress. Sex is a biological pursuit of primitive urges. Seeking out writing and information is an intellectual pursuit (partisan froth aside). Journalism may have a better chance of finding a niche of people willing to embrace paying for worthwhile presentation of worthwhile information. In other words, as The Atlantic’s article put it, I think people do have slightly higher standards for their news than for their porn. Slightly.

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Tell your audience the truth about what they’re paying for

Posted in Online media, Print media, tagged , , , on June 4, 2012| Leave a Comment »

One of my great frustrations in recent years has been that as news organizations have tried to cope with advertising declines, almost everyone — both readers and journalists — have seemed relatively ignorant about the revenue and cost structure of the typical newspaper. Readers and journalists complain that the more you cut, you make the paper less worth picking up, which is true, but at the same time if you raise the price they complain about that too. Often the companies’ woes are portrayed as the result of greedy bosses trying to pad profits, a stereotype that perhaps was closer to the truth in the ’80s, but in the current economy even nonprofit-owned newspapers are struggling. Given all that, why not tell readers exactly what it costs to put out the paper and what percentage of that they are actually paying? Finally, someone has: the publisher of the Arkansas Democrat-Gazette, in a letter explaining a doubling of the cost of buying a paper. That paper, unlike most large papers in the U.S., keeps all of its content behind a paywall to protect its paid circulation, which seems to have worked — but as the letter explains, since subscription payments do not cover much of the cost of producing the paper, that hasn’t insulated it from trouble:

“Despite all of these efforts, our advertising, like most newspapers, has continued to decline. Even though advertisers tell us they get good results from advertising with us, they have far more options on where to advertise today. With this loss in ad revenues, and by maintaining our circulation and news reporting, we have seen our profits dwindle to unsustainable levels. … In the future, we will have to rely more heavily on revenue from readers and subscribers.”

That kind of frank discussion of the business side is going to be vital going forward. People may understand that you get what you pay for, but since the news industry has for so long sold them subsidized products, people need a whole new education about what exactly they are paying for.

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Future newsrooms will need fewer people but better pay

Posted in Online media, Print media, tagged , , , , , , , , , , on May 31, 2012| Leave a Comment »


I will take issue with the poynter.org headline The one chart that should scare the hell out of print media, for two reasons. First, it’s actually two charts, the second of which is above, from a presentation by KPCB’s Mary Meeker. The two illustrate what appears not to be a blip but a trend in the money end of the news business. The one above extrapolates the advertising revenue.

You may question whether it is reasonable to extrapolate a trend from the greatest economic collapse since the Depression. I would argue yes both because it started before the economic collapse and because of the second chart, comparing where advertising revenue is spent and where consumers spend their time:

Note on the far left: People spend 7 percent of their time with print media, but print gets 25 percent of the advertising revenue. Note on the far right: People spend a combined 36 percent of their time with Internet and mobile media, but those get just 23 percent of the ad revenue. Even if print will be perceived as a better buy (not a bet I would make), at some point those numbers seem likely to come closer to equalizing.

First conclusion: The ad revenue decline of recent years seems likely to continue.

This leads to a point made by Ken Doctor at the Nieman Journalism Lab: Money coming to news organizations from readers (paid circulation/online access) is growing as a percentage of revenue. Partly this is because of declining ad revenue — if you’re total revenue is $100, then $20 is a small percentage, but if your revenue drops to $50 then $20 is pretty big – but it’s also from the growth of various kinds of paywalls. I remain convinced that an all-or-nothing paywall closes a newspaper off from the possibility of luring new customers, but the trend toward metered paywalls seems able to draw in both avid readers and those who wouldn’t pay even for the bigger headlines of the day.

What the combination seems to lead us toward, as Doctor indicates, is a model where many news organizations will be asking for subscriptions more on the basis that NPR stations ask for memberships — not because they have something every day that you want know, but because you want free access because they regularly do. Advertising, in this scenario, becomes an increasingly less important revenue source; readers drive the revenue.

One fear I have read often in the past is that a news model driven by what is popular would gravitate toward the lurid and celebrity gossip, but I don’t think the above situation would do that. The kind of readers drawn by that kind of news would not be the ones who pay for regular access. Those readers would want at least the occasional substantial bit of civic journalism or in-depth news. You might make a living (a la TMZ) if you are at the top level of celebrity gossip, but at the local level that won’t cut it.

But what also seems likely is that the new level of revenue may not support seven-days-a-week newspapers in many markets, as Clay Shirky argued will eventually be the case even with the Washington Post. If that becomes the common model, then would mere daily scarcity of news drive enough people to buy online subscriptions to get news from “newspapers”? After all, in many markets there are TV and radio stations, which already send out news for free, and in many cases there may be small sites such as Homicide Watch (cited by Shirky) that focus on certain high-interest news areas more thoroughly. What then would spur people to pay for access to the mainstream non-TV news site?

Aggregation is part of the equation — if a news organization shows that no matter the source, it will round up all the news in the community, it could gain a loyal local following. But that seems not enough, to me. If less frequency is key, I wonder whether a higher quality of writing in the reduced number of publication days will be a major factor. If that’s the case, then the frequent publishers’ first instinct of holding down news salaries when budgets constrict could be counterproductive.

The keystone of my evidence, besides any manager’s common sense, is from a story by NPR’s “Morning Edition” in early May about new research measuring human performance in groups, which found that a minority of any group typically will account for a majority of the group’s performance. In other words, a few stars get more done at better quality than a larger group of more typical people. That runs counter to my experience of what managers at all levels do in the face of budget pressures, which is to replace departing staffers with someone who costs a lot less and is deemed “good enough.” “Good enough” hires, if you extend the logic of this study, actually cost more in the long run because they are not just a little but a great deal less capable.

There’s a tantalizing hint of this thinking in the memo from Jim Amoss to the Times-Picayune newsroom about changes in New Orleans from the paper’s reduction in days of print:

“Concerning pay in the new companies, I want to dispel some rumors: There could be some salary adjustments, depending on changes in job descriptions. But most people will make what they make today, if not more.”

I will repeat the relevant part: “most people will make what they make today, if not more.” In a world where the competition for eyeballs is not just local, the need for writers who can catch a reader’s attention is heightened, and it would make sense that if you find you have someone who can both produce the daily bits of news needed to keep a news site relevant while also producing stories worthwhile to the remaining partial-week readership, you would pay that person better than someone who could do only one of the two functions.

For that reason, I would reach back all the way to the early 2000s for a piece of advice I heard an executive repeatedly give (mostly in vain) to publishers: You get what you pay for. If you cut the size of your staff but increase the pay of the remaining people, so that your payroll overall is the same, you might be able to attract and retain the people you need. It is guaranteed that if you cut the staff size and hold the line on the pay – or, worse, cut it – you will never have the people you need, and who would want to pay to read your sorry rag at that point?

6/12/12 UPDATE: I’m gaining some hope about the above from an INMA article about the Star-Tribune boosting reader revenue closer to 50 percent:

“We’re asking users to pay more of the freight. But for that strategy to work, we knew we needed to focus on high-quality customers who see value in our products and have low churn. And to get those high-quality customers, we’ve focused on three areas: our core print audience, pricing/retention, and accessibility.”

If you’re going to focus on high-quality customers, you have to have high-quality staff to provide the value needed to hold onto those customers:

“The content we provide isn’t available anywhere else. This is local reporting — business, local sports, city council meetings. You are doing that, and you are relevant. Differentiate yourself from your competitors. Once you do that, you’re going to get people and you’re going to get them to pay.”

But it’s beyond content to a smart strategy on pricing and marketing. Those are not my areas of expertise, but the article’s points sound good to this journalist.

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