Paying for photojournalism: a review of the New York Times ‘pay wall’

March 30, 2011 · by David Campbell · media economy, photography

Money Paying for photojournalism: a review of the New York Times ‘pay wall’

Newspapers in the US and UK continue to struggle with growing debt, declining circulation and falling advertising revenue. In the search for additional sources of revenue, new schemes for paid content are being implemented. (For an excellent overview of the issues, listen to WNYC’s On the Media podcast from January 28). After nearly two years planning, the New York Times launched its “metered” system this week.

This development has been greeted positively in the photographic world, with Aric Mayer, Rob Haggart and Joerg Colberg endorsing the thrust of the scheme. While agreeing that news organisations need to find new ways to fund critical journalism, I don’t share this upbeat assessment of what the New York Times scheme means for photojournalism. Indeed, as I’ve been arguing for the last eighteen months (see here, here and here), I think it’s a mistake for photography to pin its hopes on a revival of the long-lost editorial paymaster.

Here I will review commentary on the NYT scheme and suggest an alternative way to think about revenue that would be more beneficial for photojournalism. This a complex issue that demands some key assumptions are questioned, so this is a very long post. I don’t pretend to have all the answers, but I hope you will take the time to read it in full and engage the debate.

The pay scheme that isn’t a wall

Although much of the discussion has proceeded in these terms, the NYT scheme is not a pay wall. As Steve Yelvington argues,

A paywall…is a dumb, blunt instrument that separates content from the general public, prevents sampling, inhibits linkage and sharing, and usually is the product of an unhealthy arrogance.

That view sumps up the approach of the Times and Sunday Times in London, the experience of which demonstrates the limits of that approach. Although there are now 79,000 digital-only subscribers to the Times pay wall, there has been a massive reduction in the paper’s online readership (90% according to one initial estimate), advertisers have become nervous about the decimation of their online audience, and the journalists are cut off from the wider social media conversation because of the block on search engines and the inability to link freely. The small gains in monthly revenue will not make a significant dent in the tens of millions of pounds the Times loses annually, they may not offset the lost advertising revenue, and they come at the price of cultural presence and global engagement, which in turn most likely reduces advertising revenue that depends on reach.

To try and avert the falls in readership that result from demanding online payment, the NYT scheme permits some open access and encourages continued linking. Everybody can access 20 articles a month, after which you are asked to pay $15-$35 every four weeks depending on the device you want to use. If you are a print subscriber, you get access without additional cost, and if you come to a NYT article via a search engine or distributed link (via Facebook or Twitter), that does not count against the quota of twenty. To get it all up and running, NYT is offering, in an echo of iTunes, four weeks access for 99c.

Reactions and estimates

Reactions to the details of the NYT scheme have been many and varied (see eleven mixed responses garnered by the Nieman Journalism Lab here). Whatever one’s initial take, it is clear that the paper’s aim is to limit the number of readers who will encounter the request for payment. As Steve Buttry observed:

they have structured this to apply to a small segment of their online audience (people who read more than 20 pieces a month who don’t subscribe to the print edition and don’t find them through search or social media).

Buttry feels that the result will be “a trickle of revenue, not worth the time they spent developing the plan.”

Given that the NYT spent $40-50 million on planning and implementing its scheme, it needs to produce a significant amount of money just to cover development costs before there is any hope that new revenue will make its way into content creation – the journalism, and then photojournalism.

There is also the issue of lost opportunity cost. As Koi Vinh – a former NYT designer who was involved in the initial planning — asked what else could the NYT have developed with the enormous effort and resources the scheme consumed in the last two years?

I’m not qualified to judge detail of the economic projections, but it is clear from reading the commentary there is a great deal of uncertainty around the plans. From its global audience of 42 million unique users each month, the NYT is hoping to get 300,000 digital subscribers in the first year. That could mean it takes two years to repay the development costs, or it could mean increase in subscription revenue of 10% or more. However, even the latter, more optimistic calculation offers a boost that is marginal in comparison to advertising revenue. Ken Doctor notes that digital advertising makes up 26% of total advertising revenue for the paper, and that sector is growing:

If the Times could nab another half a percentage point in market share of that still-growing pie, that would amount to $140 million a year, dwarfing new digital circulation money.

Personal expense and premium content

The NYT scheme varies in cost depending on the number of access points, and is being sold somewhat disingenuously as a particular amount “every four weeks” which, although it sounds like a “per month” proposition, actually requires thirteen annual payments. At the top end, it is a very expensive deal when compared to others offering similar services. Michael deGusta has visualized the NYT and its competitors, and he concluded by asking:

Does The Times really think the mass audience is going to decide their $455/year is better spent on The Times rather than getting 20+ free articles/month from The Times plus The Wall Street Journal ($207/year) plus The Economist ($110/year) plus say The Daily ($39/year) for good measure, and still having ~$100 left over each year? (emphasis added)

What the NYT is requiring for its digital-only subscription has lead deGusta and others (such as Frédéric Filloux) to argue that the NYT scheme is a defensive strategy designed to stop existing customers from cancelling their print subscription revenue rather than a creative approach to generating new digital revenue.

Another part of the NYT scheme underscores its defensive nature. At first glance the scheme is a “freemium” approach in which a certain amount of free content is provided in order to build up demand for premium, paid-for access. Yet while the NYT is requiring payment from its most regular readers, it is not offering them anything new in return. The scheme requires payment for content they have accessed for free until now. As Dave Winer remarked, “they’re not offering anything to readers other than the Times’ survival, and they’re not even explicit about that.”

Still free for many

The NYT scheme is also not a pay wall because it is porous and easily avoided.

Part of that is intentional. To ensure it remains in the global social media conversation, the paper allows the front page of its blogs to be freely accessed, and has no limit on the number of articles that can be read by following a link on Facebook, Twitter and some search engines. Indeed, the paper has its own Twitter account @nytimes with more than 3 million followers, all of whom can follow as many links as they like each month. The Lens blog has discussed all this overtly in a special note.

In addition, NYT journalists and columnists with their own followers – such as the Lens blog’s James Estrin – will get more articles, posts and galleries for free. This is all before the computer literate pursue other ways to maintain free access, which involves little more than four lines of code to get around.

Can it emulate other successful pay schemes?

People who want to see good journalism well funded have been hoping that the NYT scheme might replicate the Financial Times success with digital subscriptions (although there is now a debate how successful the FT actually is). Nonetheless, the fortunes of the FT (or the Wall Street Journal) are not replicable for general news and daily journalism. The FT and WSJ provide time-sensitive market information that has direct value to subscribers, many of whom get it as a business benefit rather than through personal expense and are therefore not price sensitive.

Much as we may wish otherwise, even the investigative journalism of the NYT is not a scarce or fixed commodity like an FT market analysis or a music track from iTunes. With other credible news sources (e.g. the BBC, Guardian et al) pledged to remain globally free, and the news stream constantly updating, readers are resistant to paying for online content that has been and will remain freely available.

If that makes you wish for a chance to rewrite history – imagining that ‘if only’ newspapers had ganged together and set up universal walls at the beginning of the Internet age we would now be handing over money without complaint – then pause for a moment and reflect on this. The Internet is an intrinsically open system. If all the legacy media outlets had withdrawn into walled gardens, do you not think that sometime during the last fifteen a bright spark would have set up a free global news site attracting millions and funded via advertising or related sources? Something like, you know, that Harvard graduate and his little project called Facebook…

What is the purpose then?

The NYT scheme is expensive, complex, porous, and easily worked around. Even if it functions as desired it won’t generate anything like the revenue that would flow from the growth in online advertising. It is accompanied by risks, such as alienating the NYT’s most engaged and loyal users and reducing the reach of NYT stories. And it has potentially large lost opportunity costs – an on-going commitment to a print-based strategy that will run its course in the years ahead, and the lack of investment in creative alternatives during that continued decline.

It is possible that all the sceptics are wrong, and we shouldn’t knock the willingness to experiment in these revolutionary times. There is great uncertainty about the details of the economic projections, but even if the scheme succeeds beyond anyone’s wildest dreams it is only going to provide a fraction of the needed revenue to fund critical journalism. Paid content schemes, no matter how flexible and nuanced, are subscription models, and subscriptions have historically only ever provided approximately 20% of a newspaper’s revenues with 80% from advertising (although papers like the WSJ have a 50/50 split). Given the availability and culture of freely available general news, who would bet on digital subscriptions reaching even that historical share?

So why have they done it?

I think the NYT scheme is less a business model and more a moral imperative.

It is based on the claim that people should pay for quality journalism. It is a scheme designed to defend the worth of the paper’s journalism. This has been explicit in a number of arguments in favour of such schemes that talk about a “value proposition.” It appears when an editor says

the act of placing a value on our journalism may be more important than any penny we ever collect

And it is to be found in Aric Mayer’s statement that

it [content creation] is a thing worth paying for, and requiring the audience to pay for it demonstrates its value.

Of course, quality journalism and photography costs, and it should be paid for (though I am not as misty eyed about the USP of the NYT as some). The question is how and by who is content paid for. Taking an historical perspective again, we have to note two important things.

First, news and investigative journalism has never made money by itself in order to pay for itself. We should not, therefore, be judging current plans by the flawed assumption that we are looking for a single business model that will do what has never previously been done.

Second, we as readers have always paid for modes of distribution but never directly for content. Viewing the NYT scheme as a device for readers to value content though direct payment is wishing for a historically unprecedented change of behaviour in the most unlikely of circumstances. As Steve Buttry caustically observed:

My friend and former boss Jim Brady says that you can’t build a business model based on what people should do (and newspaper people believe in their bones that people should pay for their content). You build a business model based on what people will do. This tortured maze of exceptions and trigger points is a laughable effort to collect because people should pay but to find a way not to lose the people who won’t pay.

The NYT scheme also comes up short as a value proposition because of it offers subscribers nothing new, there being no exclusive or premium content to go with the newly demanded payments. And quite how a company rationalises asking patrons at the front door to pay while the very same goods are being handed out the back door free (via its own Twitter feeds) remains a mystery.

But above all else we should recognise that value has different forms and manifestations. It is a mistake to see price or payment as the only index of value. Circulation, distribution, engagement and global presence have considerable value.

Fine, but where does the money come from?

In his welcoming assessment of the NYT scheme, Aric Mayer wrote:

Journalists and Photojournalists should be applauding this move. It signals an effort by the New York Times to uncouple content creation from direct dependence on online advertising. Without online subscription prices or online newsstand sales, there simply is no other way of generating a predictable online revenue stream.

There are, of course, problems with a dependence on advertising, although that has historically been the mainstay of the legacy media many continue to view fondly, and online advertising is growing and will soon overtake print advertising.

Diversifying revenue has to be a good strategy. But is it that case that without online subscription “there simply is no other way of generating a predictable online revenue stream”? I disagree with that claim.

There are many other ways of generating predictable revenue streams, and this is where the news business has to learn from other sectors like the music industry, which encountered digital disruption before journalism. Pursuing these routes could mitigate the risks of the paid content approach.

John Temple, the last editor of the Rocky Mountain News, argued we have to appreciate that news organisations do not make money from news – news is the ‘brand’ for the organisation and the money comes from relationships and services only indirectly related to journalism. Instead of a single business model for journalism emerging, we need to see a series of diverse models producing revenue indirectly.

For music, the idea that content creation (the songs) is what provides significant revenue through fans paying directly is slipping away as album sales fall. For some of the mega acts, only a tiny fraction of their revenue comes from the music they write. The bulk comes from things that revolve around the content – concerts, merchandising, video games, advertising, and sponsorship. And some of these mega acts give their content, the music, away for free in order to enhance their revenue from the related but indirect sources.

This means that instead of just advertising and subscriptions, transactions are a major alternative revenue stream. Indeed, a Fairfax media executive has remarked that transactions rather than advertising or paid 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. The various ‘reader’s offers’ that papers have long provided are a pre-web version of this.

How might this work for the NYT in relation to photojournalism? Here is a proposal that is much more direct that the newly proposed scheme and the hope that some of its revenue trickles down to content creators. (BTW, has anyone reported a rise in photo fees or a spike in demand for photographers by News Corporation since the Times pay wall went up?). If someone takes up this proposal for a photography site, I might even coming calling for a consultancy fee, but for a limited time only I am offering it for free!

The Lens blog is a high profile site with some 750,000 users visiting each month. Instead of raising money by hoping some of those subscribe on their 21st visit each month, consider the monthly visitors as a community of interest around photojournalism and offer goods and services to that community. There could be Lens-sponsored master classes, special events and workshops for both professionals and the general public; print sales; discounted equipment and photographic services via business affiliates; photo tours and themed travel; equipment, medical and travel insurance for practitioners; logistics and visa services for photographers having to travel at short notice…you name it, anything that interests a broad photographic community, amateur and professional, could be offered by negotiated deals where Lens’s earns a percentage on each transaction.

This strategy would leverage the Lens blog Twitter feeds and referrals providing unlimited free access. It would be based on growing the community that comes to the site, thereby underscoring the value of having quality photojournalism distributed globally and the benefit of having it accessible to as many as possible. It could raise more revenue than subscriptions could achieve, and the revenue could go directly to photojournalism.

Funding critical journalism and photography has always been difficult and will remain difficult. Hoping for a paid content scheme to offer salvation strikes me as being like a cargo cult. Paying for premium content, or content with longevity – like the move to make magazine articles saleable as in-app downloads or Kindle singles – has a future, through the amounts may not be large. But there is little historical or contemporary evidence to suggest people will start paying for daily news in sufficient numbers, and remonstrating with individuals about what they should do is something best pursued by priests rather than corporations.

Equally, scepticism about paid content is not a theological position dependent on the virtues of free. I think an appreciation of how ‘free’ functions on the web is essential but that means seeing how it connects to paid. Like many I happily pay for multiple modes of news distribution. Having stumped up for a seven day print subscription to the Guardian and Observer, a digital replica subscription of the same papers and two versions of the Guardian iPhone app, while eagerly awaiting their iPad app, GMG has many of my hard earned pounds. They would get even more from me if they had a photography blog that offered equipment transactions, because purchasing that new tripod I need or shotgun mic I want could earn them affiliate revenue.

But if the Guardian was to go back on its commitment to free access to quality content through those modes of distribution, I would be heading elsewhere for my general news and comment. That is the nature of media ecology in the twenty first century, and only a realistic assessment of how people function in the world of social media will provide a sound basis for funding new content.

Featured photo: borman818/Flickr, used under a Creative Commons license

 

21 Responses to “Paying for photojournalism: a review of the New York Times ‘pay wall’”

  1. Excellent analysis.

    I am a very frequent commenter on NYTimes Comment pages on-line. I have thousands of published comments over the last few years, and feel that I am giving back to the Times much more than I am getting. I loved the fact that anybody on the planet who wanted it had access to my words in the context of the NYTimes.

    But I won’t pay them for access to the site.

    This is currently not an issue as I follow https://twitter.com/timeswiretap for usable links to most of what is published that I like to read. This is from a NYT feed but supplied in Tweet form. I also use AdBlock Plus and No Script to simply stay on the NYTimes site and read whatever I want.

    The porosity of the 40 million dollar paywall is baffling, but as long as I have free access I will continue writing, and I hope all the readers worldwide who surely cannot afford the cost will continue reading NYTimes.com as it has wonderful reporting and opinion and so much else.

    I hope they survive this blunder.

  2. Quite a bit of feedback from a long post.

    1. I disagree with Steve Yelvington’s assessment that “a paywall …is the product of an unhealthy arrogance”. How is it arrogance to expect some sort of compensation for putting out something that you think has value and costs quite a bit to produce? Conversely, this statement seems arrogant in itself to expect / demand free access (simply because it is free elsewhere). If the argument is that the content can be readily found elsewhere, then clearly he sees no value in paying for it, which is fine. However, the NYTime’s basic argument for setting up the paywall is that they believe there is value in their content, over and above the user generated and aggregated (HuffingtonPost) similarities out there. I believe it is for the user to determine if there is value or not and vote with their wallets. Even Huffingtonpost has pulled in $300M for setting up an operation which depends on the aggregation of content from other sources.

    My point here is captured by David’s observation that “The NYT scheme is less a business model and more a moral imperative. .. It is based on the claim that people should pay for quality journalism. It is a scheme designed to defend the worth of the paper’s journalism.”. I happen to subscribe to that view. Would love to hear the argument against that. Granted, there are other ways to extract value, but however flawed a paywall implementation is, it is still one way to extract value.

    However, like David, I don’t see a paywall as “the” solution. David’s post captures the essence of why it won’t work in this case. Key:

    * Paywall will erode the total traffic to the site, which advertisers depend on.
    * Journalists are cut off from the wider audience – (the reason Frank Rich just left and I suspect Bob Herbert too)
    * Its expensive ( in NYTimes case)

    I also disagree with the assertion that the NYTimes’s strategy is designed as a defensive strategy to stop existing customers from canceling their print subscriptions. That would be an absurd strategy – to defend their current print subscriber base at the expense of tapping into a wider online audience which has the potential to be leveraged to grow more / new revenues?

    Another point of disagreement with David’s post. Quote:

    “The NYT scheme also comes up short as a value proposition because it offers subscribers nothing new, there being no exclusive or premium content to go with the newly demanded payments”

    Do they need to offer something new to prove the intrinsic value of their current product? – a belief fueled by the assumption that the current product already has more value built into it than free alternatives. Also note that the fact that others like the BBC offer the same news for free does not prove that there is no value to it – The BBC may have come up with a way to subsidize / fund its news production, despite the heavy cost of production. Perhaps, the NYTimes does not have that luxury.

    However, David has made a recommendation that needs to be seriously examined – the proposition that revenue can be generated indirectly from ancillary services is a powerful concept worth exploring. My 2 cents.

    • Victor, you disagree with quite a bit, so I will offer a couple of clarifications to see how far those disagreements go.

      1. The NYT scheme is not a pay wall – the term is in quotes in the post title, and the first section deals with that.

      2. You’ve misunderstood Yelvington’s point. He is saying that a pay wall which is blunt, impervious and removes links is the product of an unhealthy arrogance. He was quite explicit that the NYT scheme was not a pay wall – click the link and check the title of his post too – so his comments are not directed at the NYT. They are directed at Murdoch, and the fact that the London Times pay wall prevents any linkage from search engines to content. Yelvington regards that as an act of hubris in the current world, and I agree with him.

      3. You subscribe to the view that a moral imperative – people “should” pay – is a good business strategy, and want an argument against that. Well, this post is an argument about the limits of that view! I thought I had outlined that, so I won’t repeat everything from paragraph 25 on down. Historically we have never paid directly for content (always distribution), the web has created a new ecology in which that is ever more the case (and not just because of the absence of paid content strategies, but because of their limits in an inherently open system), and we have fifteen years experience of people accessing general, daily news for free. The complexity of the NYT scheme is designed to recognise all that while still getting its most loyal readers to pay, even as the NYT keeps giving away its content via Twitter. That complexity alone demonstrates the limits of operating on the basis of a moral imperative. It is obvious – and I have repeated this endlessly – that quality journalism has to be paid. Its just not obvious that the best payment is from readers directly.

      3. You don’t see it as a defensive strategy, but that is the view of some very able media analysts that I link to. I think its a compelling point. The evidence? The high cost of the digital only access (higher than any other content provider) and the bundling of free access with the print subscription. But you are right, that’s not a smart move.

      4. Re the absence of added value, you say “Do they need to offer something new to prove the intrinsic value of their current product?” Two problems with that. First, you are supporting your position with the idea of the “intrinsic value of their current product.” Of course their journalism has value. But we are talking the business of cold economics here, and that value has not required payment. So, now the NYT says, pay $455/year for unlimited multi-platform digital, access, offers nothing in addition to what people got previously for no cost, and continues to offer that previous content free via social media. Really, that makes sense? People are going to reach into their pockets and give the NYT what amounts to a charitable donation in recognition of past and continuing service? Maybe, but it seems an odd basis for a business strategy.

      Value is more than price and payment, as I said above. Just because people get it for free doesn’t mean they don’t value it. The BBC can function as a producer of great journalism because UK residents like myself pay an annual license fee (£142.50 – the equivalent of £11.88 per month or just under 40p per day, as they say). Its compulsory and effectively a tax, but it means US residents like yourself can access the BBC for free. They are not going to charge you for their content, and I don’t think they should.

  3. The Lens blog currently ‘showcases’ photographer’s work without remuneration and the NYT photographer contributor contract and low day rates have been heavily criticised in the past.

    I wonder if these issues will be adressed or revued now there is a paywall in place.

    I suspect not.

    • Adam, your comment gets to my initial concern, which is what impact, if any, will these developments have on photojournalism.

      The London Times pay wall is generating some revenue. So I asked above, ‘has anyone reported a rise in photo fees or a spike in demand for photographers by News Corporation since the Times pay wall went up?’

      Its a genuine question. But I doubt anything is trickling down. Here’s why:

      One estimate says it is generating £685,000/month.

      The last figures I can find on the financial situation of the Times and Sunday Times shows them losing £87 million in 2009 alone. While no one sniffs at extra income, if those losses persisted, then the pay wall would be covering less than 1% of the annual losses.

      All this shows that papers like the Times exist because of subsidy. News Corporation is highly profitable (£385 million last year), and that is largely driven by television. It is from those profits that it can cover the costs of its loss making papers.

  4. I’m in favor of the scheme, putting aside the easily exploitable mechanism to gain access to content inside of the wall, I think paying for good content is now a reality we need to start accepting.

    Steve Yelvington’s argument is rather basic in approach, in that he expects companies to offer content to the general public in order for them to share links amongst themselves.

    I wouldn’t call this prevention arrogant, it’s very similar to you walking into a music shop and loading the cd into your laptop, listening to it and then mailing it to your friends. How is protecting content that has taken time and effort to create, arrogant?

    The Times and Sunday Times did indeed see a drop of online readership, only because the general Internet population has become accustomed to free content.

    I do question the amount spent by the NYTimes. Having worked on large complex web portals on the Internet, including numerous Internet banking platforms, that figure is either inaccurate or has been made more attractive by an overzealous marketing department to prove the worth of subscribing.

    I was present during the initial launch of the FT.com website in 2000 and know how successful this was, even during the crazy dot-com period in full effect at the time.

    With this in mind, and my estimate that it most likely cost in the region of 3 million dollars to implement the various code changes required to operate the paywall, 300,00 digital subscribers paying a monthly fee would see the costs recuperated in a shorter period of time.

    You’ve quoted the BBC as an alternative source but that is a different argument. The BBC website is funded by the British tax payer and as such, has revenue coming in from numerous budgets and, for international customers, advertising revenue.

    Summing up, I personally welcome the move by one of the industry giants to start charging for quality, well-produced content. You don’t have to subscribe, if you want to view free content, you are welcome to use google and search to your hearts content.

    Personally, as someone who produces content and is constantly battling the economic restraints of doing so, I hope this sees a change in the way content is funded.

  5. Daniel, thanks for the comments. I’m neither for or against the scheme. As I say in the post, experimentation in funding journalism is important given all the uncertainties. If a company can get people to hand over money, be it through the London Times approach or the NYT approach, then good luck to them. But…I think the NYT scheme has many peculiarities and operates with some contestable assumptions. And, most importantly, as someone who produces content, I wouldn’t be holding my breath that any revenue generated by this scheme is going to trickle down, especially to photojournalism – so I would endorse Adam Dean’s scepticism above.

    Let me just respond to some of your points:

    1. Like Victor, I think you’ve misunderstood the Yelvington quote, given its directed at a particular type of pay wall, which the NYT scheme, as I make clear, differs from. The arrogance he refers to concerns the desire of Murdoch to cut off his journalists from search and linking. Of course Murdoch can do what he likes for the Times, but Yelvington’s point is that in the web world that is cutting off your nose to spite your face.

    2. You say “The Times and Sunday Times did indeed see a drop of online readership, only because the general Internet population has become accustomed to free content.” Well, 90%+ is a pretty dramatic “drop”, no? The point of that stat is that there is value in reach. And the second part is the nub of the matter, and why I think schemes based on the moral imperative of what people “should” do are mistaken. Surely sound strategy is based on what people actually do as consumers, not what businesses wish they did. I doubt very much that any paid content scheme is going to change mass consumer behaviour with regard to general news.

    3. Perhaps the estimate of the $40m+ cost is questionable, but you will have to question the Bloomberg reporter who sourced that information, and others who report the same range.

    4. The FT – it’s a particular case, and not replicable for general news, as discussed above.

    5. The BBC – I’m not quoting that as a case contra the NYT, especially as I pointed out exactly what I as a British resident have to pay for it. The point there, in response to Victor especially, is that while we residents pay a compulsory annual fee that provides open access to all resources at all times across TV, radio, and the web. It also means that residents of South Africa and the US can access those resources for free, which is something I would defend on the basis of that global access having value too. Would you extend your support for the NYT scheme to a proposal to make BBC content available globally only after payment?

    6. Finally, “the easily exploitable mechanism to gain access to content inside of the wall” you refer to is something that the NYT has made a part of the scheme. I have to note again the NYT scheme is not a “wall” as discussed at the outset. It has great complexity to it, but the continued free access via social media and search is not something that requires devious or morally reprehensible behaviour by consumers. You just have to follow @nytimes or your chosen columnist. To me, that shows the NYT is hedging its bets – trying to get customers at the front door to pay, while people at the rear window are given the same content at no cost. Isn’t that a little odd? And even unfair on the customers at the front?

  6. Hi David:

    In regards to Steve Yelvington’s statement, I was referring to the general assumption (not to Steve personally) that a paywall is evil on the current open web. The assumption that if someone puts their “premium” content behind a paywall there is something bad about it. What the NYTimes is doing may not be classified as a paywall in the strictest sense, but it is a version of it, with differences in implementation ( how porous it is and if it allows links e.t.c). But the principle remains the same – setting up a toll booth in front of your content ( for everyone or only for a specific segment).

    My “moral imperative” argument goes as follows: If you value the content The NYTimes produces, then you should be open to allowing them to extract some value for it from you. Your example of paying an annual license of approx. 40p per day is an excellent one – so you are paying for accessing the BBC content for “free”. It jives with my statement that perhaps the BBC has a way to fund its operations which is not available to the NYTimes as an option. They have found a way to extract value from a certain segment of its users which affords it the opportunity to make it free for people like me.

    I totally agree that the NYTimes system is not structured right – the part about charging for it and yet making it free through social media.

    Lastly, I am struggling with your statement that, even though you recognize that quality journalism has value, the economics of it does not require any payment for it. ( because it is produced on the “open” web which traditionally does not pay for content?)

    • Victor:

      I think the value of the web comes from linking, so I would like to see an example of someone saying that a pay wall is ‘evil’. It is certainly not my view.

      I’ll come back to you on this, but I need a clarification first. You write:

      “I am struggling with your statement that, even though you recognize that quality journalism has value, the economics of it does not require any payment for it.”

      Where did I say that?

  7. Hi David:

    Quote:

    “Of course their journalism has value. But we are talking the business of cold economics here, and that value has not required payment.”

  8. C’mon Victor, that’s not a fair reading of that sentence!

    You said you were struggling with my view that “even though you recognize that quality journalism has value, the economics of it does not require any payment for it.”

    And you support that with a sentence that says “that value has not required payment.”

    Two different things.

    The latter is a statement of fact about the availability of general news on the web to date. It has not required payment. It hasn’t. The NYT and others offered it free, and still do so at least in some measure. How can you read that as me saying “the economics of it does not require any payment for it”?

    Here is what I think about paying, taken from above:

    “While agreeing that news organisations need to find new ways to fund critical journalism, I don’t share this upbeat assessment of what the New York Times scheme means for photojournalism.”

    “Of course, quality journalism and photography costs, and it should be paid for (though I am not as misty eyed about the USP of the NYT as some). The question is how and by who is content paid for.”

    “…we need to see a series of diverse models producing revenue indirectly.”

    “Paying for premium content, or content with longevity – like the move to make magazine articles saleable as in-app downloads or Kindle singles – has a future, through the amounts may not be large.”

    “Like many I happily pay for multiple modes of news distribution…”

    “It is obvious – and I have repeated this endlessly – that quality journalism has to be paid. Its just not obvious that the best payment is from readers directly.”

    Now, please, how do those clear statements add up to me saying journalism “does not require any payment for it”? It is beyond question I think it has to be funded and paid for. The issue is how best to do that.

  9. Your past statements certainly confirms your stance about the need to pay for journalism – agreed. (I have been reading a lot of your posts today!). With your clarification I see I totally read your comments incorrectly. It is very easy to misconstrue the meaning of the statement when offered in context of an argument making the case for free access to journalism. my mistake.

    • Thanks Victor. Past and present statements both, because those quotes in my comment are all from the post (and one from the comments) above, and follow on from other posts over the last 18 months.

      Can I just clarify one other point…this helps us get to the nub of this matter…

      I’m not making “the case for free access to journalism.” I’m not trying to establish my own moral imperative. As I say in the second last para of the post “scepticism about paid content is not a theological position dependent on the virtues of free.”

      I see my argument as being a call for a realistic assessment of how people consume news via the web, and what that means for the struggle to fund critical photo/journalism.

      I regard the demand that people “should” pay as a poor place to start given the fifteen years experience we have of free consumption. You tweeted recently the results of a Canadian poll that showed 90% of respondents would not pay for general news. When the Times pay wall goes up, traffic falls 90%. This is an established phenomenon.

      I don’t see anybody being able to seriously challenge that consumer behaviour with any scheme for directly paid content in general news (and remember that is different from premium content).

      So any business strategy that wants to generate revenue from web readers has to work from that position, not against that position. Proceed from what people do, not what you wish them to do. Work with how they behave, not how you think they should behave.

      I do believe that ‘free’ can be leveraged to move towards paid. As I said above “I think an appreciation of how ‘free’ functions on the web is essential but that means seeing how it connects to paid.”

      But that’s nothing like saying free alone is what we should have.

  10. I also subscribe to the idea that leveraging “what people do” may be the strongest option to generate a viable business model for photojournalism today. However, it seems to very quickly discount the possibilities of a subscription model.

    To clarify, I understand the inherent differences between the content FT / WSJ has vs. the NYTimes, but I still don’t see why its generally accepted that its ok for them to charge a subscription fee for access whilst the NYTimes can’t or shouldn’t. The subscription to the WSJ is not like having access to a Level II trading platform. They peddle financial news which may also be obtained elsewhere on the web. However, I think they charge because of the extra analysis they bring to any topic. And so does the NYTimes.

    I subscribe to the online versions of the WSJ and Barrons for their indepth analysis- especially Barrons. This is not general news. I think the NYTimes is also making the same case for it’s content, albeit with a botched implementation.

    Itunes and the App store “demand” that people pay for access to a different type of product – music, games e.t.c and we do so willingly. Is this any different from premium content?

    • Victor, the issue here is how people regard content as either general news or premium/specialist content, and I think you are running the two categories together.

      The FT/WSJ are regarded as having, in addition to general news, specialist financial content that a well heeled community is willing to pay for. A large part of that is the fact the subscriptions are business rather than personal expenses.

      Although you are regarding the NYT has providing premium content and extra analysis, and there are segments that do that, as a daily paper most of its content is general news. Once you hit the meter on the 21st article in the new scheme it does not distinguish between whether that is a general news story or a backgrounder piece you might regard as ‘premium’.

      The reason general news is not an easily saleable commodity is that its value ‘perishes’ very quickly. If I can get an update on the situation in Libya from a range of other credible sources, then I am not restricted to one that is asking me to pay for that update.

      This is very different from the iTunes model, and Clay Shirky explains the reasons here.

      Fans of the NYT call its journalism ‘premium’ because they think it is good. But premium needs to be more than adjective – it has to be a different type of content that has value because it lasts and is not fungible.

  11. David:

    I certainly agree with you that journalism and photojournalism need diverse funding models. I would go beyond the use of the word funding to say business models, which implies a kind of reasonably predicable or reliable process of generating revenue.

    When I wrote the piece you quote here, it wasn’t my intention to imply that the Times’ online subscription is more of a moral imperative where readers should do the right thing by paying for what the Times has to offer. Quite the opposite. I don’t think the readers have a moral imperative in the market to pay for anything that they don’t perceive to be worth the value requested in exchange for it. Neither does the Times have a moral imperative to distribute content for free. The leadership of the New York Times does, however, have a very real moral and legal obligation to work to return a profit to the owners of the New York Times, the shareholders. And they have to do this while navigating a very chaotic technological and business climate.

    What I was trying to get at is that the content on NYTimes.com has real value. And that value can be seen in monetary terms.

    At the time, the design of the Times’ paywall was not yet fully apparent. As that became more obvious, I took another look at the design within the context of the Times’ business climate. I explore that in a basic sense in my follow up post, seeking to understand the logic of the subscription strategy as it is explained by the New York Times’ own financial reports. This is certainly not a definitive analysis, but it gets closer to how I think about the process.

    http://aricmayer.blogspot.com/2011/03/further-thoughts-on-times-paywall

    Best,

    Aric

  12. Update on the cost of the NYT pay scheme …Arthur Sulzberger of the NYT told an interviewer the Bloomberg report citing $40 million plus (and linked to above) was wrong, and the cost was far less, but he declined to specify the amount. See the report at http://paidcontent.org/article/419-sulzberger-40-million-estimate-for-paywall-cost-is-vastly-wrong/

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