By Matthew Rocco
When it comes to the newspaper industry, Kevin Coyne said, “Someone has to be Bradley Beach.”
Coyne, a journalism professor at Columbia University and former writer for The New York Times, explained that New Jersey shore towns once made money by charging people who wanted access to beach houses that were used to change clothes. When the Holland Tunnel opened in 1927, more visitors started driving, and they no longer needed to use beach houses. Bradley Beach was the first shore town to charge beach goers, and other towns followed suit.
In an age of digital technology, the printed newspaper is overshadowed by the computer screen. Tangible news is not valued as highly as it used to be, especially when it comes to the technologically savvy.
The newspaper industry has been in flux for a number of years, but recent developments may prove to be the most significant changes yet. USA Today announced that the print edition will be scaled back to allow the newspaper to focus its resources more on digital content. The paper recently cut 35 newsroom positions, some of which were already vacant.
Both The Philadelphia Inquirer and the Philadelphia Daily News emerged from Chapter 11 bankruptcy Friday after the purchase of the two newspapers was finalized. According to the Inquirer, the newly-formed Philadelphia Media Network immediately made its mark when the owners told the executive editor of the paper, Bill Marimow, that he would not be able to retain his position due to his lack of experience in digital media.
The evolution of the internet has long been considered the industry’s kryptonite. When the internet first became part of the mainstream news cycle, the newspaper industry slowly adapted to this new medium. News on the internet was typically free, so most newspapers decided that the only way to compete on the internet was to provide journalism free of charge.
“The mistake was to rush to put news online for free. The Wall Street Journal did not go off that cliff. It was never free,” Coyne said. “No one said, ‘Maybe The Wall Street Journal is right?’”
Owned by Dow Jones & Company at the time, The Wall Street Journal was the only prominent newspaper to require its readers to pay for online content. It is now enjoying a one-year increase of 17 percent in print and online revenue, according to a memo sent to the newspaper’s employees.
Such an increase in profit is uncommon in the newspaper industry, considering the lack of online ad revenue. “I’m thrilled that The Wall Street Journal is doing well in print, but they are an anomaly,” Coyne said. “It is owned by a guy with extraordinarily deep pockets who believes in newspapers.”
Rupert Murdoch’s News Corporation purchased Dow Jones in 2007, signaling the first ownership change for The Wall Street Journal in 105 years. Murdoch has made it clear he intends to compete with The New York Times, a plan that has led the Journal to provide more coverage of general interest stories. The paper has always been a prominent source for business news with a targeted audience of business professionals.
The first major change to The Wall Street Journal was the addition of a “Greater New York” section that includes local news and sports. On September 25, the paper unveiled an expanded weekend edition that includes two new sections.
While The Wall Street Journal has always required its online readers to pay for content, other newspapers are just getting around to instituting what is commonly referred to as a paywall. The Boston Globe, for example, recently announced it will have a website with free news in addition to a subscription-based website starting next. The New York Times plans on charging readers in early 2011.
“The model was always built on ad revenue, and online ad revenue doesn’t come close” to replacing lost ad revenue from print editions, Coyne said. “The trick will be whether newspapers can make people pay. Gathering information is costly. They need to figure out how journalists and editors and everyone else will get paid. Everyone has a different strategy.”
The Times announced last January that the site’s paywall will be metered, a system that allows readers a certain number of free articles before a fee is necessary. In 2005, the paper launched a paywall called “Times Select,” which charged readers for access to an archive of stories in addition to articles written by the newspaper’s columnists. The New York Times Company decided to eliminate the paywall two years later.
According to Diane McNulty, Executive Director of Media Relations for The New York Times, the paper’s original paywall generated $10 million in its first year and attracted 227,000 subscribers.
“Our research suggests that our users are willing to pay for our high-quality digital content,” McNulty said in an email. “The tools and technologies have now emerged to enable a truly frictionless consumer experience, and the metered model approach is one that will allow for significant sampling of quality content through search, social networks and the real-time web.”
“We believe there is and will continue to be a demand for quality journalism. And that demand is what has made and continues to make newspapers relevant, either in print or online,” she added.
Although new technology may provide newspapers with a potential source of revenue, there are still obstacles that the news industry must overcome. “The iPad was considered the savior. Apple and the news industry will be in the same battle that Apple and the recording industry was in. They had to figure out who got what,” Coyne said.
Other portable technologies such as smartphones and e-book readers can also be fertile ground for newspapers. Many newspapers offer separate subscription plans for e-reader editions. Smartphone and tablet applications deliver news in a usable format, sometimes for a price.
Readers will remain interested as long as newspapers can provide quality journalism that separates itself from other online news sources. People still need the press to deliver information, a promising point for the newspaper industry.
“The question is whether people will be satisfied with free offerings or willing to pay for premium news,” Coyne said. “Newspapers can stay alive as long as people are paying.”
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