Thursday, July 23, 2009

Newspapers History: 180 years of not charging for content

By Jeff Sonderman on newsfuturist.com

"I have a history lesson worth reading for those who think news should or may have a price online:
... Newspapers haven't actually charged for news content since the 1830s.

Up until then, most newspapers were subscription-only and cost about 6 cents a day (or about $1.20 in today's dollars, adjusted for inflation).

By asking subscribers to bear the full cost of production, newspapers limited their audience to the few who could afford the luxury. That was actually OK for the time, because literacy rates were quite low anyway.

But compulsory education raised literacy rates as the 19th century progressed, and in the 1830s publishers realized a new model to reach the growing market - the penny press ..."
Jeff concludes:
So, newspaper folk, economics actually says the same thing about charging online that it has said for 180 years about charging for print: you must set consumer prices at or fractionally above the marginal cost. In print, that may be the 50-cent newsstand price. Online, with cheap bits, it's ~ zero.

If economics hasn't allowed total-cost subscription pricing in print newspapers, even with their market monopolies and other advantages, why would anyone think economics would allow such pricing in the ultra-competitive online market?
via / more

Later, Christie Silk on editorsweblog.org
Economic History: can we apply the same market principles of the penny press to online news?

As I wrote / said many time before, this digitalization is disruptive. But no way you should try to argue with the customer to pay for the news online as they have done before for news on their paper - they paid for (some) services and comfort! In a disruptive business you have to find new ways and, there is a good chance that advertisers will pay for the other half of the business.

So you've got to develop services user (readers and advertisers) want and make your idea of making money work. If not, Journalism will - find together with their clients - other ways to do the job.

Earlier postings
Abonnentenwerbung - wie eine Koalition gegen vom Kunden bezahlte Inhalte

Zeitungsgeschichte(n): Jubiläum 400 Jahre Zeitung

Zeitungsgeschichte(n) II.: Citizen Journalismus im Jahre 1690

Die Anfänge der Fachpresse in Deutschland
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