Saturday, December 16, 2006

The future of newspapers -- will people be willing to pay?

By Jeff vonKaenel
( )

The author has published alternative weeklies since 1973. Presently he is CEO and majority owner of the Sacramento News & Review and weeklies serving Chico, Calif., and Reno, Nev. The following is an excerpt of a longer essay on the future of newspapers available at the website of the News & Review. Here's the

I believe by taking the long-term approach to business, daily newspapers should have been working much harder to move their newsgathering operations online. How will they pay for themselves? I think we all need to grab our shares of the advertising market. But I also believe that subscriptions eventually will play a big role in supporting strong, daily online newspapers.

The conventional wisdom today is that people won.t pay for information online. used to getting it for free. It.s a good argument, but I don.t think it holds up. Reliable information is extremely valuable. People need it to move through life.s difficult choices; they need it to be relieved of the difficulty of everyday life through entertainment.

That.s why I think it.s a myth that people won.t be willing to pay for credible information. Right now, only the Wall Street Journal and the New York Times (in part) have been successful in getting people to pay for online content. Not long ago, the Los Angeles Times quietly withdrew its requirement that users pay to view its entertainment news online after too few signed up. But I believe people will change their habits, and mechanisms that provide easy ways for people to pay for online content will be developed. It.s just a matter of time and effort.

Jeff vonKaenel published his predictions in November of 1996.

Not that long ago, the conventional wisdom held that no one would pay for television. Cable companies proved that wrong. Everyone also believed that people wouldn.t be willing to pay for software. Microsoft showed us all that wasn.t true.

With the demise of daily newspapers, some $50 billion worth of advertising money will be freed up. My hope is that this wealth will fertilize and support new advertising and circulation strategies as news operations move online.

Newspaper companies are struggling to try to keep their businesses alive. Just the other day, seven media giants representing 176 newspapers made a deal with Yahoo to provide news to the millions who use that service. But my fear is that as long as newspaper executives continue to manage their companies for short-term profits, their efforts are bound to fail as too little, too late.

Ten years ago, I predicted that the Internet meant the death of daily newspapers. Although it appears that prediction is becoming a reality, I see cause for optimism. I believe the economics of the Internet make it possible to finance strong, local journalism online through a combination of subscriptions and advertising revenue. Because of the way many of the major newspaper companies relentlessly have pursued profit at the expense of journalism, I believe they will not be the ones left standing.

I.m hoping for new leaders to emerge. Leaders who believe in the importance of journalism. Leaders who believe in the importance of telling stories that make a difference in people.s lives. Leaders of a rebirth of local online newspapers that operate 24-seven, with lower costs, greater immediacy and stronger impact. I.d like to imagine that we can return to the time when there was more than one local daily newspaper in a town. There are so many stories that need to be told.


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