Business model options for small local daily papers

Claudia Elliot, ex-Editor of the Porterville Recorder, our local paper, and current Editor and General Manager at Tehachapi News joined a facebook discussion on the Recorder’s page today. The discussion is regarding the usefulness, appropriateness, and value of online news delivery of news vs. sticking with traditional print distribution and she asked the insightful question:

Have to wonder, what would a person be willing to pay for such a service — people who go out and gather news and take photos and develop and maintain an infrastructure for others to be able to access? What would most people be willing to pay?

I responded:

One that has not been asked here before!

My own sense is that there are a couple of suppositions in that question that should be considered:

1) Do people in Porterville read local news at all? Clearly many don’t. That’s kind of a shame. I (and probably you) wish it was 100%. But it isn’t, and there are a lot of socio-econoimic reasons for that mostly beyond the control of the paper.

2) Whether people read local news or not, they increasingly get their news online, and the demographic of folks still wedded to the print edition are probably older and so it won’t last forever.

3) The idea that people have paid for “news” in the past is an open question in the industry, as you might know. Some posit that people paid for the ads, the gossip, the entertainment, the comics, the puzzles, and that the news was incidental. At least after say ~120 years ago when comics and modern advertising were invented.

4) So it may well be that adverting as a sustaining source of revenue may not ever support a news-only site. And as for those other categories of information online, it is already clear people won’t be looking ot newspaper sites for them in any appreciable amount.

5) The idea of paying a fixed subscription for online is not likely to work for small local sites. There is not enough material to justify what larger sites charge, and with a porous firewall, most people would figure out how to get it free anyway.

6) An online-only site not strictly tied to the rhythms of the sun might work, if the content was compelling enough to draw eyeballs and hence advertisers. Aside from the journalistic angle of it, this is what disappointed me the most about the Recorder’s decision to take down the “TCSO misbehaving” video: it was online only and drawing an audience that was engaged. By letting it go, there could have been some very interesting data collected about what types of stories people online would get excited about, and that could have guided both editorial and business decisions. It was just pure opportunity lost, eventually followed by an 800 word editorial attempting to justify the errors all around and only making it worse.

7) Because people do get their news and entertainment mix from a variety of sources online every day, we are seeing new classes of aggregators to handle the distribution. I referred to some of these earlier. My own sense is that I would not want to have to anticipate ll of my news sources in advance and pay for them individually whether I use them or not.

But I can imagine a future where I would pay for the aggregation services, either directly, or perhaps as part of my phone plan. Just like every film producer *could* put up their film online and charge for it to stream on an a la carte basis, but instead lets aggregators such as netflix and others handle the distribution and delivery, and take a snippet of the revenue when the material is viewed, I think news folks might look towards similar models.

8) In situations like that, the Recorder is wasting opportunities to explore what the real value of its material online is by not working to make it available under various schemes (whether they are the schemes I prefer or not), and instead making it difficult to access. The data that can be collected is lost forever every single day.

9) The new owners are almost certainly going to want to go in the direction of the future while capitalizing on the brand names of the past once they get settled. Maybe in the bigger scheme of things, post-sale, it is better to jut hang out because they will bring some business models and tech with them when they are ready.

But I am not clear why that precludes the making of material online promptly and broadly, because the data will be valuable in establishing a negotiating position later when cost to reader or aggregator questions are asked for real.

Claudia – guessing this is pretty similar in Tehachapi?

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