MakingCentz

Snarky Thoughts on Personal Finance From a Dad of Two

Do You Pay for Online News?

Do you subscribe to newspaper?

Do you subscribe to newspaper?

I am a big fat hypocrite.

I have worked in journalism since I was a teenager, but don’t spend a lot of money to actually support news operations.

I don’t subscribe to a newspaper or a magazine. I read mostly free sources online and watch network and cable news programs.

Suffice it to say, I am not exactly helping when it comes to saving the journalism industry.

I recently spent some time analyzing my newsgathering habits in order to find out why I’ve chosen not to pay.

The short answer is that there’s a lot of free stuff out there to keep me happy. There are news sites like the Washington Post and New York Times that were once free, but now are not. But like most people, I find it hard to pay for something I got for free for so long. (Especially if the product is not as good as it used to be.)

Philosophically, I believe in paying for quality news and supporting journalism. But personal philosophies aren’t the only driver of what people choose to pay for. If we paid to obtain all services and products that we philosophically support, we’d go broke.

I think I would be willing to pay for news under certain circumstances. But in my view, a proper business model for news must combine good value with convenience. Here are a few thoughts on a model that would work from my perspective.

Eliminate Fragementation

One thing that’s clear is that people get their news from a variety of sources. Loyalty doesn’t really exist anymore, and news is coming at us from so many sources that people often don’t even recall where they read or saw something. Thus, people aren’t inclined to pay a subscription fee for a single publication.

My list of everyday news sources includes: Washington PostNew York TimesBaltimore SunCapital Gazette (local news here in Maryland), New Yorker, Wall Street JournalMotley Fool.

As you can see, many of these sites are behind a paywall. But I usually find ways around the pay barrier through social media sites or other means. If I were to subscribe at each site, I’d probably end up shelling out more than $100 monthly, which is more than what I’m inclined to spend.

But what if I could subscribe to ALL  of those sites and others for a smaller fee of say, $30 a month? Then I might sign up. The key is to find a model that allows news organizations to combine on a one-price-for-much structure.

But price is not the only factor. I don’t want to have separate logins and passwords for each site. I’d like to be able to have a single subscription and single login that will get me access to all of the content I want.

More Like the Music Model

The idea of a single subscription for everything is not unprecedented. Users of Spotify or similar music streaming services are not asked to pay separately based on artist or music label. Spotify strikes deals with labels and artists, and you simply pay $9.99 a month for access to the entire library. Revenues are then distributed based on how many songs are played.

Apple’s iTunes service follows a different model that allows you to pay a small fee per song or album. But you only pay for what you actually want, and there’s a single site that allows you to search based on song, artist or genre.

Two Possible Solutions

Based on my analysis, I think there could be two business models that would made me inclined to pay for news.

Single Subscription Model – Under this model, news organizations would either create a co-op or buy into a service run by another firm. Users would go to a website and select what news sites they want to read. The fees would vary depending on the selections. Users would receive a single login for all of those sites and be billed once.

Under this model, users could go to a central site and see all of the top headlines for the sites they subscribe to. Revenues would be directed to “member” news organizations based on a combination of traffic and feedback on quality and usefulness. (This would provide organizations some incentive to provide quality content, not just click bait.)

Pay as You GoI like to call this the “EZ Pass” model. Imagine if your web browser had a digital wallet plug-in that allowed you to distribute micropayments for each article you read. It could be tied to a pre-paid account or a credit card.

Each article would have a set “price” based on the length of the piece or amount of work invested.  It might be something like 25 cents for a basic news article, all the way up to a few dollars for a long investigative piece. The browser plug-in would allow each user to see a running tally of the money they’ve spent on news consumption.

Under this model, news organizations could adjust the price of an article based on popularity. If an article goes viral, companies could adjust the price upwards a cent or two and cash in on the demand.

I call this the EZ Pass model, because if you’ve ever used EZ Pass at toll booths, you come to realize only at the end of the month what you’ve paid in tolls. In most cases, you use the service because you have to, and the bill comes due later.

A version of this model called Blendle is being experimented with in The Netherlands.

Here’s what the founders of Blendle said about the current state of news and why they decided to push for a single-paywall solution.

“If anything, the music business has taught us that consumers want a simple way to pay for content. As a consumer, you only want to pay for content you actually consume, you want algorithms and social to help you filter, and you want everything in one place. While consumers changed, newspapers and magazines didn’t adapt.

To this day you still need to register at every newspaper or magazine you want to read while paying monthly fees for every site or for a bundle of articles with all kinds of stuff you don’t read. The editors still make a non-personalized selection for you, and every newspaper has its own website.”

I am hoping the founders of Blendle are onto something.

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