August 31, 2016
ASU professor Eric Newton responds to recent study that says news organizations are dropping paywalls
An Arizona State University journalism professor has said “there’s no such thing as one model” for the future of digital journalism, responding to a newly published study that shows dozens of newspaper companies are abandoning paywalls as a way to drive profits.
The review, published in the International Journal of Communication, shows that 69 publications have either suspended or removed paywalls, which can devastate online traffic and divide audiences.
“These findings suggest openings for reformers aiming to create the next generations of public, freely circulating media,” wrote study authors Mike Ananny and Leila Bighash, of the University of Southern California.
ASU professor of practice Eric Newton, the innovation chief in charge of change and experimentation at Cronkite News, agrees that opportunity abounds.
“Now we’re in the digital age, there’s no such thing as one model,” Newton said. “There are a thousand models, a million models, a trillion models and one must find the right model for the right place and the right time to reach the people that one is concerned about in the community, through the right means.”
The paywall model came in response to circulation declines at the start of the digital era. News organizations went to paywalls to recoup print-based losses in ad revenue and subscriptions, but the move fell short. According to the study, paywalls generate only 1 to 10 percent of industry revenue.
Part of the problem, Newton said, was in the name.
“Whoever started calling [digital subscriptions] paywalls is the stupidest marketer in the world,” he said. “You know, you look up the definition of paywall, and it says it’s a subscription. And newspapers have sold subscriptions for more than a century. So all they’re doing is creating a digital subscription. But they just decided to join in with everyone else in calling it a wall. So that can’t help, that’s poor execution.”
Large, established publications like The New York Times and The Boston Globe have had success in establishing and maintaining their digital subscriptions. But Newton said digital subscriptions have also done well in small markets.
“Digital subscriptions were very successful in Little Rock, Arkansas, where they never offered the local news for free on the web. From the very beginning they offered that their print subscription also covered their digital subscription,” he said. “In places like Placerville, the gold country in California, there was no other source of local news. You had to pay the paper to have the local news, so people didn’t have a problem paying the paper for local news on the web, there was no alternative.”
Newton said there will always be “a future for news because people always will have a need to know.”
The format, however, might change. When newspapers “were monopolies they made a lot of people angry. Many newspapers were not engaged with their communities.”
“You see that America is very polarized right now, and newspapers, their attitude was always, ‘We’re in the middle, and if the people who are on the left don’t like us and the people who are on the right don’t like us then we’re doing a good job,’” Newton said. “The problem with that is that you might be doing a bad job and the people on the left don’t like you and the people on the right don’t like you because nobody likes you, and you’re fooling yourself.”
Newton pointed to Philip Meyer’s 2004 book “The Vanishing Newspaper: Saving Journalism in the Information Age” as a source outlining the decline in household newspaper penetration. Meyer outlines the peak of newspaper daily publications occurring in the 1920s, when there were 1.3 papers in every American household. That dipped to 0.54 in 2004, and is now below 0.3. According to projections, by April of 2040, that number will be zero.
“We do need a new model,” Meyer wrote.
That new model may mean that newspapers of the future may become flexible as they adjust to the needs of the community. The necessity for “department store” news where stories cover a broad selection of topics with little depth could give way to niche subjects tailored to specific communities, Newton said.
Publications could turn to the public access model provided by some radio stations and look to the communities they serve for philanthropy, or they could closely pair with business and sell software or services, he said.
Still, Newton said, “news provides the information about events and issues that helps people run their lives and govern themselves in a better way. They’ll always need that information. We’re just entering a period where we’re not exactly sure which economic mechanisms are going to support which kinds of information.”
The most recent findings simply confirm the opportunity for innovation, he said.