Revolutions in the media economy (5): the pay wall folly for photographers

December 22, 2009 · by David Campbell · media economy, multimedia, photography

Revolutions in the media economy 5 Revolutions in the media economy (5): the pay wall folly for photographers

This has been a momentous year for media. In my previous four posts on the revolutions in the media economy, I have used the present uncertainty to take a fresh look at the past many now view nostalgically. This critical view demonstrated that newspapers have always been commercial enterprises rather than altruistic associations, they were in decline many years before the Internet restructured the conditions of publishing, and that the practice of investigative journalism is something we need to create as much as we need to protect. In this context, photographers who believe that their practice is defined by an editorial paymaster committed to documentary work are going to have a very hard time. During a recent panel discussion in London on “the new ecology of photojournalism,” Ed Kashi remarked that despite all the gloom and doom we should realize that this is now a potential golden age for photojournalism. He didn’t underestimate the problems but he urged people to think about the prospects for new forms of visual journalism across multiple platforms to diverse communities. I think Ed is spot on with his reasoned optimism, but to appreciate where this might lead us, we have to drive a stake through the heart of a prehistoric argument that has dominated the last few weeks of the year.

‘Parasites, thieves, and promiscuous behaviour’

Rupert Murdoch and his trusty lieutenants (Les Hinton of Dow Jones, James Harding of The Times and Robert Thompson of The Wall Street Journal) have launched a vicious rhetorical war against the free circulation of content on the internet, singling out Google and others for making aggregation and distribution possible. This is part of a News Corporation effort to garner allies for their strategy to charge for news content. Plans to put their papers behind pay walls have been much trailed by Murdoch executives. The time it is taking to implement these proposals, combined with their unwillingness to follow through on their threats to block their content from Google’s view, demonstrates the purpose of these manoeuvres is to try and reshape the public debate, get as many other legacy media companies as possible to join them in similar strategies, and wring some business concessions from the successful new media companies in the process. Murdoch’s protestations – which have been effectively countered by Eric Schmidt – have given some comfort to those in the photographic world who hope that the sight of a pay wall going up might mean the return a benevolent editorial paymaster. It’s time to put that dream to bed once and for all and face up to the challenges and potentials of the new era.

The problem with pay walls

What Murdoch and others are missing is the new ecology of the web and how that has changed things for good, in both senses. For those who want critical journalism in all its forms, the debate on pay walls is at best anachronistic and at worst counter-productive. We can see this in three different ways:

(i) Little money:

Building on the points in my first post of this series, we need to appreciate that even the most successful pay wall strategy will never fund investigative journalism. Pay walls are a form of subscription. But subscriptions have only ever generated about 20% of a newspaper company’s revenue. This means the most successful pay wall will never compensate for the collapse in advertising revenue. Nonetheless, the idea that people paying for content is the holy grail of lost revenue is increasingly promoted by media organisations who are now more willing than ever to explore this option. It has become an almost theological commitment that users should pay. But this overlooks one very significant historical point – consumers have not previously paid for content. As Paul Graham argued, we have paid for the mode of distribution rather than the information being distributed:

Almost every form of publishing has been organized as if the medium was what they were selling, and the content was irrelevant. Book publishers, for example, set prices based on the cost of producing and distributing books. They treat the words printed in the book the same way a textile manufacturer treats the patterns printed on its fabrics.

This has been the case with newspapers too. Rupert Murdoch, now demanding customers stump up for his articles, had no qualms about selling at a loss by reducing the price of The Times to 10 pence a copy (or giving it away as a free item in bulks) during the British newspaper price wars of the 1990s. Having never priced his products in terms of the cost of content, now is an odd time for him to start. It is possible that for highly specialized content consumers will be willing to pay something for access (see the conclusion to this debate). While recent surveys offer contradictory data on how much or how often people will pay, even the highest of these numbers offers no hope as a general solution to the economic crisis of distributing journalism (while the lowest condemns it as a flawed strategy). Corporate media debts are too vast to be eased by revenue from premium content, so we should not cling to the false hope that new money will fund the documentary stories that have long been under-resourced.

(ii) Who they block:

The second problem with the supposed pay wall solution emerges when we have a more nuanced understanding of web traffic to news sites. Companies like to make a big deal about the number of “unique users” visiting their URLs, and this summation of global clicks is an important indicator of reach. But most visitors come quickly for something specific and leave equally as quickly. They aren’t reading “the paper” on-line, but searching for a specific piece of information, consuming it, and moving on. Indeed, although some surveys have reported higher numbers, the average time spent on a US news site in November 2009 ranged from just four minutes up to a high of 23 minutes.

If a news organization wants to extract commercial value from its online users, it needs to find a way to first attract large numbers and keep a proportion of these visitors on site for longer so that over time they become loyal. This means the target audience for such an economic strategy is much smaller. To illustrate this, consider the following metrics from the Daily Mail in the UK:

  • 28.7 million unique users/month globally
  • 8.9 million unique users/month from the UK
  • Of the UK users 611,588 came to the web site every day
  • Half of those UK daily users (c. 300,000) stayed for 20 minutes

So while the headline-grabbing number of 28 million unique users suggests a vast community of potential value around the Daily Mail, in fact their loyal on-line users number just 300,000, which is just 7% of their daily print readership.  (The Times editor recently confirmed a similar pattern on his site by contrasting 20 million uniques with the 500,000 who had developed a ‘genuine digital habit’. If one were thinking about a pay wall to control access to content on a paper with these user numbers, where would it be built? Around all content so that each and every visitor had to pay to pass? Around content viewed a certain number of times so the daily visitors were forced to open their wallets? Or directed at those who stayed on site the longest? Two recent posts by Steve Yelvington and Damon Kiesow brilliantly illustrated the counterproductive nature of this dilemma from their experience with local American papers. Kiesow graph Revolutions in the media economy (5): the pay wall folly for photographers As this graph from Kiesow’s Nahsua Telegraph in New Hampshire makes clear, if your advertising depends on reach, you don’t want to cut off the huge number of uniques on the left, some of whom might be transformed into loyal users if they have open access.  And the number of daily/loyal visitors on the right is too small to build a viable subscription model on. All this shows a general pay wall for news content will slash the number of visitors and fail to generate even modest revenue for investigative journalism. This is not the counter-theological proposition that “all information should be free” (a view Jay Rosen recently found to be often proclaimed but little referenced by those in favour of pay walls). It is recognition of the harsh economic realities of the web’s ecology for news that too many traditional companies are failing to appreciate. Some, though, are realizing that this disparity between the millions of casual users and the thousands of loyal readers points the way to a new strategy. A Fairfax executive in Australia recently remarked that transactions rather than advertising or content were the best on-line revenue streams. Crucially, transactions require news organisations to build a community around their brand and product, and then take a percentage of the transactions (hotel bookings, financial advice etc.) those community members conduct through the associations, links and relationships provided. Building a community based on the smaller, loyal audience is something a Daily Mirror executive outlined, while Slate has been shifting from the pursuit of a mass audience (7 million uniques) to a smaller, more engaged audience (target 500,000) because “one curious reader is worth 50 times the value of the drive-by reader.”

(iii) How they limit public good:

Proponents of pay walls say consumers must contribute to the cost of journalism because it is a public good. We should debate the assumption that journalism per se is automatically a public good given “the media’s” patchy record for accountability in recent times. But even if we rather rashly accept that the majority of the fourth estate is critical of conventional wisdom and questioning of those in power, pay wall advocates have this argument upside down. The public good of journalism in the age of the Internet comes from the vastly expanded possibilities of circulation and distribution. Clay Shirkey has argued this recently (see video here) by calling attention to how a 2002 Boston Globe investigation of child abuse by Catholic priests in the city travelled globally from its Massachusetts origins to the global community of Catholics, mobilising social groups along the way, and ending with the Church having to take action internationally (such as in the recent Irish government report on abuses in the Dublin Archdiocese). Shirkey’s argument is that it was the forwarding of the original article, rather than just its publication, which enabled people to mobilise and force authorities to act. Circulation was what gave the story value as a public good. So while Murdoch and others see public re-use as a crime against civilization, both Shirkey (and Jay Rosen in his interview with Shirkey here, starting at 9:30) demonstrate that in the new ecology of the web this forwarding (or “super-distribution”) of information and its public re-use is the condition of possibility for the very democratic ethos and public virtue media proprietors say they are desperate to defend. If information gets forwarded to journalists to cross-check and challenge their stories it can make them better, and the journalists’ stories get forwarded to people who are the most relevant thereby enabling social action. For Shirkey, this is the public good of publishing on the web. Murdoch might regard it as ‘promiscuous’, but pay walls would prevent the expansive sharing that is at the base of this public good.

Towards the new futures of photojournalism

Here is my point for photographers – forget all the fuss around the Murdoch-inspired debate about paying for content that has dominated the last few weeks of this year. Perhaps News Corporation will make pay walls work for some of its titles, but they won’t be the economic saviour of any media company. Nobody should pin their career hopes on them enabling a rosy future that will replicate a lost and largely mythic past. A new subscription-funded editorial paymaster looking for photographers to assign is not going to emerge, and holding out for media conglomerates to deliver this will only stymie creative development. However, Murdoch is not really trying to create a new revenue stream (let alone one for documentary work). He is trying to change the terms of the public debate on the web in order to “call time on free distribution.” But that is an even more impossible task, because free distribution is both the intrinsic architecture and great virtue of the web. Tim Berners-Lee, who is credited with inventing the web, was recently asked why he put the web into the public domain as a free facility rather than a private enterprise. “Because otherwise it would not have worked,” he said. (Just watch the first two minutes of this video interview with Berners-Lee to appreciate this core value). The successful visual journalist in the new media economy is therefore going to be someone who embraces the logic of the web’s ecology, using the ease of publication, distribution and circulation to construct and connect with a community of interest around their projects and their practice. Like the media players beginning to understand that developing and engaging a loyal community is more valuable than chasing a mass audience (while being open so those passers-by can become associates), photographers need to do the same. If people now understand they are publishers as well as producers this puts them in a new and potentially powerful position. It won’t be easy (but when was photojournalism or documentary photography easy?), but the successful visual journalist will be someone who uses social media (in combination with the more traditional tools of books, exhibitions and portfolios) to activate partnerships with other interested parties to fund their stories, host their stories, circulate their stories, and engage with their stories. The social value of this is obvious, and this social value will be the basis for drawing economic value so the work can continue. A good number of people (like Ed Kashi) are working this way now. Jonathan Worth has been pursuing a fascinating project based on his portraits of Cory Doctorow (read an interview with him here discussing this), and VII is promoting discussions around these themes.  In the last couple of weeks we have seen new digital magazine formats unveiled, and if developed these will be exciting platforms for visual work. What all these moves have in common is an embrace of the virtues of digital technology in an open web. Google has been one of the icons of the last decade, and while as a company it is far from perfect, its success marks the path for the future so long as we understand what is novel about the web. Featured photo credit: Karl Randay/Flickr, used under a Creative Commons license

9 Responses to “Revolutions in the media economy (5): the pay wall folly for photographers”

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