There’s no doubt that the media industry has seen dramatic change in the last 15 years. Readership of traditional newspapers has plummeted. Compounding the issue, the traditional newspaper model where classifieds and ads were sold based on circulation (regardless if someone actually read the paper and saw your ad) has been absolutely decimated as advertisers have moved their dollars to more effective, more addressable advertising options.
With the rise of many quality blogs, online publications, and digital video and social media, we continue to see this content shift online faster than ever before, and the old school newspaper monetization model doesn’t work online. For instance, even if a newspaper sold all of their banners at the highest possible CPMs, it would never make up for what they have lost from their traditional model, and therefore will never be able to support the glory days of newspapers. Say a newspaper could sell four banner ads on a page for $10 CPM each (and that’s being generous). For every 1,000 page views, they would make $40. Applying Denver Post’s comScore stats for last month where they generated 45,000,000 page views, they would make $1,800,000 per month. ... Read more
There's been quite a bit of talk about whether newspapers can restrict content to subscriber's since Rupert Murdoch said he was going to restrict his news outlets online. Rupert never says anything unless it serves his business interests, so I doubt it was a co-incidence restricting Google access while signing a deal with Bing in which they will have complete access (for a fee) happened at the same time as he was publicly trying to "save the future of newspapers." Today Neilssen released a study into what people will pay for. The PDF is at http://blog.nielsen.com/nielsenwire/reports/paid-online-content.pdf The key findings are:
78% believe that if they already subscribe to a newspaper, magazine, radio or television service they should be able to use its online content for free.
71% say online content of any kind will have to be considerably better than what is currently free before they will pay for it.
79% would no longer use a web site that charges them, presuming they can find the same information at no cost.
People are ambivalent about whether the quality of online content would suffer if people could not charge for it —34% think so, 30% think not; 36% have no idea.
62% believe that once they purchase content,... Read more
Amazon.com announced the launch of Kindle DX, a larger version of its surprisingly successful (it's selling faster than the iPod did in its early days) e-reader today. (NY Times) Also announced, agreements between Kindle and major newspaper publishers like the NY Times, Washington Post and Boston Globe (yeah, they're still around). (Mashable)
Here's how the deals work. Subscribers can get the Kindle DX at a discount "in exchange for long-term subscription commitments." The idea, said the NY Times, is to reach readers "who live outside of our delivery areas." (Hm. Shouldn't the idea be to reach all of your readers and get rid of the print version? It would save them money. Something I know the Times Co. is interested in since the business lost $74.4 million in Q1 this year.)