Editor’s blog: Murdoch declares end to online free-for-all

So Rupert Murdoch has found the answer to the woes of the media world. And it’s been sitting there right in front of his face all this time without anyone realising: there’s no such thing as a free lunch, so make ‘em pay.

Murdoch has been well and truly battered by a collapse in advertising revenue, as the recession combined with the advent of online has torn Fleet Street’s traditional business model to pieces. The News Corp holding company slumped to a $3.4bn (2bn) net loss for the financial year to June. If what is contained in the current edition of Private Eye is to be believed, some of News Corp’s biggest cash cows are now making a loss or seeing profits tumble. So, Rupert, in between doing some serious BBC-bashing, has declared that the online news free-for-all is over.

‘Quality journalism is not cheap,’ he noted this week. ‘The digital revolution has opened many new and inexpensive distribution channels but it has not made content free. We intend to charge for all our news websites.’ He is, as is often the case, quite right and I wish him well in his quest. Indeed there’s nothing more I’d like than to prize a couple of bob out of you for reading this on your screen at the moment. (Incidentally, don’t shout about it but MT’s website makes a profit from the advertising it carries.)

However I fear that this all has a touch of ‘shutting the stable door while the nag is cantering through the neighboring state’ about it. Once punters have experienced something for nothing, trying to persuade them to fork out cash for it is a tough sell.

The charging model will even be extended to red-top tabloids such as the Sun and the News of the World. Murdoch was particularly keen to generate revenue via the popularity of celebrity stories: ‘When we have a celebrity scoop, the number of hits we get now are astronomical’. Sure – the latest shot of Jordan, top off in the pool with her latest cage-fighting beau gets gazillions of hits (and not, sadly, just in August). But it’s all over cyberspace within seconds. News Corp’s legal department is going to have to multiply its staff twenty-fold in order to chase copyright abusers.

But there’s a wider problem. News is now utterly commoditised. Indeed, who knows what ‘news’ is any more. The whole news universe has become a blur of facts, contention, gossip and tidal waves of digital opinion. You can get your eyeful of Jordan, if that’s your fancy, all over the place – I just got 4.55 million hits in 0.23 seconds. However the kind of dross churned out by OK and Hello still sells, so it might just work.

All this in a week in which it has been admitted by its owner The Guardian that the Observer faces the possibility of closure. I have a soft spot for The Obs because back in 1986 it was the first national newspaper I ever wrote for. I could hardly believe it when I opened the pages of the magazine and found my name there. I kept thinking they’d spiked my piece and not bothered telling me.

My father had read it ever since he was a student, and I’d grown up with it on the kitchen table every Sunday morning. One of the first things I can recall reading out loud from a newspaper was Clive James’s review of Abba winning Eurovision in 1974. It struck me as very witty at the time. In those days the paper sold three quarters of a million copies. It now sells a less-impressive 400,000 copies, and appears doomed. With the exception of the excellent and innovative Food and Women’s monthly magazines, it’s all been pretty lifeless in recent years. I click through the contents online hidden within The Guardian’s website.

There’s no reason why we should be especially sentimental about newspapers. Things change. There’s also no greater reason to mourn job losses among hacks than among LDV or Corus Steel workers. Newspapers have been pretty dozy in waking up to the changes that the digital world brings and have made the fatal mistake of giving content away for nothing as they compete desperately for clicks.

So, although The Observer’s fate makes me sad, then I think of the South Park clip – instantly available via YouTube – highlighted on today’s MT bulletin. Vile, filthy but instantly amusing. Also the picture I took on my Nokia E75 this morning of my nine-week old daughter that I’ve just shown to colleagues – who smile politely – and might whizz over to a mate in New York later. And I also wonder about electronic tablets such as Kindle which might offer a lifeline. And, finally, I think about the hundred and fifty quid which I’ve just slightly begrudgingly forked out to the FT for online access to their stuff for a year – only to be told today that they are going onto a pay-per-view system. Rupert still has hope and he’s right to. It ain’t all media Armageddon yet.


In today’s bulletin:

RBS gloomy despite being back in the black
Are women directors bad for a company’s bottom line?
Editor’s blog: Murdoch declares end to online free-for-all
Bribe migrants to stay, says think-tank
Be more diplomatic, with YouTube

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    I’m delighted to hear that your website is in profit. . although I’m willing to bet the farm that even the mighty MT might just have seen a teensy downturn in the current market. I think Murdoch is right up to a point – in the long term, quality content is not going to be funded by banners, buttons and MPUs. But that doesn’t mean we’ll all suddenly stump up for something that’s free elsewhere.

    B2B publisher’s need to offer products which solve marketing problems. The trouble for advertising sales is that the problem has changed. Marketers have stoppped asking ‘how do I make potential customers aware of me?’, and moved onto ‘how do I get potential customers onto my website so I can do business with them?’. The trouble with web adverts is that the click rate – users actually going through to the vendors website – is poor and expensive compared to search engines.

    Publishers who can answer this question have a long term future. Check out http://www.ithound.com for one approach that’s beating the recession.