Free content isn’t killing journalism

Another one of our clients — a Wall Street newspaper — shut down publication this month.

A couple of staffers were reassigned, the rest laid-off. We lost our anchor client, the client we launched our company with.

In the journalism community, it’s common to hear that the problem is with our readers, that they’ve gotten used to getting news for free on the Internet, and these readers need to be re-educated, marketed to, manipulated into somehow paying for content again.

Before the Internet, the story goes, people paid for their news. The Internet spoiled them, turned them into free-riding leeches drinking our nation’s media dry.

When the media are all dead, they’ll be sorry. Readers will be stuck with shallow blogs that refer to one another in an endless cycle of navel-gazing, without any hard news to give them meaning or substance.

The attractiveness of this argument is that it puts the blame squarely with the people who deserve it least — with the public. And lets the folks who are to blame, who are running the media into the ground, off the hook.


One issue — which should be completely clear to anyone who’s read The Innovators Dilemma — is that there is a fundamental difference in the cost structure between producing Web news and producing print news. Newspapers spend more than half of their budgets on printing and distribution — and a third on editorial and administration.

This means that every new reader has almost linear impact on costs for a newspaper.

For the Web, the incremental costs of adding new readers is minute. In fact, the Web is more like radio or television than print.

Oh, and there’s no way I’m paying extra to get my stories on the iPad, when those same stories are available for free, unless the iPad stories offer a significantly better experience. And I’m having a hard time imagining what the iPad could do that would be valuable and useful that the Web doesn’t already offer. Ad-free news? Google News has that. Videos? Every site has those.

Newspapers have repeatedly tried ways to get people to pay for content by packaging it differently, in PDF files, or those annoying online magazines that are almost impossible to read, and completely impossible to link to.

And even if Apple did create a way in which the iPad was significantly better than the standard Web experience, the Internet cost equation would still come into play.

Electronic distribution is cheaper than print. Even distribution on an iPad. And as long as its cheaper, one of your competitors will find a way to undercut you and deliver the same news product for free. And I’ll get their App instead of yours.


It took 35 years after cable television was introduced in 1950 before half of the US population was paying for a cable subscription. Today, a third of all Americans still get their television for free, over the airwaves.

The situation with radio is even more illustrative. Only 6% of the US population currently pays for radio, through satellite radio subscriptions. More than 93% of us get our music and news for free, over advertising-supported airwaves. And we’ve had commercial radio available since 1920.

Clearly, there’s a way to deliver content without charging for subscriptions.


I do admit — I pay for cable television and cable Internet in my house. There are free alternatives — I could watch the three or four channels I get for free, and use public WiFi at the local library for my Internet.

I pay for cable and Internet because I get a substantial advantage by doing so. I get to watch Comedy Central, for example. The kids get nature documentaries and cartoons. I like watching USA and TNT. I don’t bother with any of the premium channels. I’m not alone — only a third of cable subscribers pay for premium channels.

When we pay for something, we expect to get something significantly better than what we could get for free. With basic cable, I get significantly more channels, and much better picture quality. With premium cable, I would get newer movies and show likes the Sopranos and True Blood. And I hear you can get sports.

With my broadband connection, I get high-speed access to funny pictures of cats whenever I want. My kids get online encyclopedias — not to mention Google, Skype video chats with their friends in China, MIT’s online classes, recipes, weather — pretty much anything they want to find out, they can. We live in miraculous times. I’m willing to pay a chunk of cash every month for that miracle.

With satellite radio, the difference is less obvious, and probably ephemeral. I can pull in Internet radio for free on my iPhone while I drive cross-country (I assume other phones can do the same thing these days, or are about to). Pandora is also a great — and free — source of music both at home and on the road. Internet radio quality is high — much better than Internet video, since it requires less bandwidth. And the old-fashioned radio is pretty good, too. We get NPR news when we need it — commuting to and from work. Prairie Home Companion on the weekends. And I’m always scanning past other radio stations as well, that deliver news, and sports, and commentary, and various musical genres.

Unless I was a rabid fan of talk shows only available via satellite — like Howard Stern — satellite radio doesn’t offer much in the way of improvement over what I already get for free.

I’m not a bad person for preferring free radio. I’m not mooching off of anyone — I listen to the commercials. Occasionally I fork over some dough to NPR. And the system works. Broadcast radio and television have found a balance between what they can afford to produce, and how much they are able to earn from advertising and donations. This balance has worked for decades.

The Internet media just need to find their own balance.


Yes, I get paid to report on things. And I firmly believe that a well-educated public is the cornerstone of democracy, and that a free market of ideas is a necessary precondition for all other kinds of free markets.

But we used to have a lot of duplication of effort in the old pre-Internet days.

Say a big story was breaking in Moscow. The newspaper from Boise would send a guy to cover it. So would the newspaper from Pittsburg. The Pittsburg readers wouldn’t see the Boise paper, and vice versa. The fact that two reporters were paid to write almost the same story wasn’t obvious to the readers, and there were plenty of columnists and journalists who were turning in the same exact stuff as someone else at a newspaper a few towns down the line. After all, how many different ways are there to say the same thing?

To some degree, the wire services cut down on this duplication of effort. And radio and television were quick to roll out centralized news bureaus, since the costs of sending local television crews around to all the big international stories would have been prohibitively expensive.

But still — you can only watch one television channel at a time. If one station airs the same exact story as another station that’s not surprising — it’s too be expected. After all, no station would want to miss covering the big story of the day.

And, to some degree, it’s good that we have competition. Having three or four different takes on the news — or 30 or 40 different takes — is good for us. Competition helps news organizations improve. But there’s a point of diminishing returns, when additional eyes on the story are no longer adding value, but are just wasting money.

The Internet has accelerated this trend a hundred-fold.

If you want to know the latest news about any topic, just head over to your Yahoo or Google or Bing home page (or whatever aggregator you prefer) and you can compare the stories from Boise and Pittsburg, the wire stories, and even the stories from newspapers in Moscow itself. Geography — and language barriers — disappear, thanks to Google News and Google Translate.

Meanwhile, many international publications, especially those focused on business, are putting out English editions, specifically for the readers who find them via the Web.

And it’s not just the geography and language. In the business sector, publications used to be very narrowly focused on specific verticals. If you were interested in a story on Chinese manufacturing, for example, you might find a story one month in a magazine about semiconductors, and another month in a magazine about furniture distribution, and the next month in a magazine dedicated to the textile industry. Few people would have the time or money to subscribe to all these magazines. They would wait for the Wall Street Journal to get around to writing a broad overview story.

Today, with Google News, you can read about developments in a variety of industry verticals related to your area of interest.


There’s a lot of invective spewed against bloggers by professional journalists. Many forget the entire journalism professional started out — in a way — as bloggers. Journalism used to be a craft, not a profession, and newspapers were leaflets with plenty of point of view and less of solid reporting.

Newspapers do have editors, and this is nice. If you’re paying for a newspaper subscription, you don’t want the day’s edition to be full of unreadable twaddle. You’d be willing to pay extra to ensure a decent quality of output. And since individual readers usually had no way to check the facts of a story, it was nice to know that there was someone doing it for you.

With the Internet, if you don’t like a story, you just stop reading and go grab that story from another source. For any popular story there will be hundreds, perhaps thousands, of alternative takes. Pick one you like better, and the Internet as a whole will rearrange itself so that next time the better-written, more popular stories will come up first when you search.

Some of those nicely-written stories may be professionally edited. Others might not. Either way, it’s irrelevant. If you don’t like it, go on to the next one.

And if something in a story doesn’t ring true to you, Google it. The world’s best fact-checker is at your finger tips. And, honestly, its much better than the fact-checkers I used to have in the good old days of print. Though, to be honest, in around 20 years of writing, I was professionally fact-checked only a handful of times. Normally, if something seemed off, the copy editor would just send it back to me for confirmation or clarification. And there was rarely any way to independently verify my reporting, especially if I was filing from a far-off country.

Today, every reader is a potential fact-checker — and readers are quick to point out not only errors of fact, but also errors of grammar. A prime example of this is how well Wikipedia ranks against Encyclopedia Britannica when it comes to accuracy.

Professional fact-checkers aren’t all they’re cracked up to be.

But then again, neither are journalists.

Is a kid who just graduated from college with a communications degree better equipped to cover a topic than an expert who has been working in the industry for years? If a topic is controversial, or the expert has an ax to grind, then maybe the kid has an advantage.

But in many cases, the expert is a significant improvement. One of my favorite expert-written publications, for example, is the China Law Blog, written by Dan Harris of Harris & Moure. Readable enough for a casual visitor, informative enough to satisfy the most die-hard China expert, the blog does a great job of demystifying the Chinese legal system.

I can’t imagine any print publication dedicating this much print space to Chinese legal issue — unless it was a very narrowly-focused legal publication. Without the Internet, Harris may have occasionally contributed articles to a business newspaper or magazine, or produced a newsletter for his firm’s clients. The rest of the world would have to do without his insights. And we would be worse off.


At my fingertips, I’ve got access to almost all of the world’s English-language publications — and rough access to non-English pubs in languages covered by Google Translate. I have immediate access to the world’s top experts. Top thought leaders. Top gossip mongers. Top humorists. And — why not? — top liars, cheats and crooks. I can find out what the crazy guy living in his mom’s basement is thinking, and what his cat had for lunch.

But there are only so many hours in a day that I can spend reading the news, checking out LOL Cats, and watching funny YouTube videos.

Something’s got to give. I’ve got to do some work, some time.

What I’m probably going to cut out first is reading duplicates of news stories I’ve already read. Except for iPad stories — I can’t get enough of those. Or the oil spill. And I’m definitely keeping the LOL Cats. They get me through the day.


The one element of the doomsday scenario that I agree with is that of disaggregation.

In case you’re not up to speed on this, it’s where classified ads move over to Craig’s List. Help wanted ads move to Real estate ads move to and personal ads move to

Auto ads? Online. Supermarket ads? Direct mail.

These were all great, reliable streams for revenue for newspapers and magazines. All that’s left is lifestyle and retail ads.

But remember — radio existed for almost a century without classified, automotive, real estate or personal ads. Television survived for fifty years.

And neither radio nor television news is cheap to produce.

In the end, we’ll probably see a great restructuring of the news industry. Less redundancy, and more specialized, niche coverage. More breadth, and more depth, from a combination of professionals, amateurs, and everything in between. There will be government-backed organizations, and non-profits, and hobbyists, and for-profits.

And then they’ll figure out a way to beam the news directly into our heads, and we’ll have to figure out revenue models based on brain waves.

I might pay extra to keep Glenn Beck out of my brain — now there’s a business model.