For newspapers, the future is now

January 3, 2011

Let’s just put it this way: This wasn’t exactly the decade of the newspaper.

Newspapers got a pretty good thrashing by the internet in the first 10 years of the millennium — call it karma for shrugging off web site startups and doing little to replace their cash cow, classified ads. The headline, though, is that after years of implosion and pontifications about the future of media, we’ll finally get some real answers in 2011. The future is now.

The fun begins this month, when the New York Times takes a second, and more sophisticated stab at a paywall on its web site, and when News Corp. is expected to launch its iPad-only “Daily” on a $100 million rocket.

Paywalls and the proliferation of tablets will define 2011 as the most significant year for mainstream media in a decade at least — a decade which has seen print circulation shrivel, an explosion in alternate news sources and Google-bashing in lieu of innovation.

Paywalls have been around for a while, of course. The Wall Street Journal and Financial Times have always had subscription services. The U.K. Times built a paywall last July, and last month research disclosed that the site had lost 99 percent of casual readers and 86 percent of its audience, with the remaining 14 percent comprised in part of print subscribers who aren’t paying extra to access the site.

Lots of smart people think paywalls are not sustainable, others think they are absolutely necessary. But mostly the discussion has been in a vacuum as no newspaper on the scale of the New York Times has tried to go from charging zero to something.

Which brings us to walled gardens, tablet style.

Apple upset the cart on April 3 with the introduction of the iPad. It wasn’t the world’s first tablet but it was the first one anyone cared about. It solved the chicken and egg problem, just as the iPhone had: Lots of people had to have one, so it profited third parties to build things for it. Apps became a new medium: downloadable paywalls.

It’s no secret that magazine publishers are drooling over tablets. Even without iTunes store subscriptions — most periodicals still charge the newsstand, single cover price for each copy — it’s clear their advertisers are so far finding tablet editions a fertile playground.

Why is that a potential boon to newspapers? In print they’ve only had the cheap canvas of newsprint. Now they have the same rich multimedia environment as their glossy counterparts. Newspapers shrugged off the dial-up 90s and forgot to monetize the broadband revolution. But apps give them a third bite.

So will these interlaced factors be enough to turn the tide? Probably not for everyone. Your local paper still has to deal with Patch and Yahoo Local — and Facebook and Twitter. There are still many moving parts. Tablets may tank. The Times — both of them — may find paywalls unsatisfying.

But there is no doubt that by this time next year we will know much more about what is possible, and what is not. And knowledge is power.


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On the net there are two kinds of users. Analog users and Digital users. Analog users are like the author of this article and most of the “big shots” on the planet today. They came from the print reading, television watching, radio listening time period and they have no idea what this Digital business is all about. Digital users have an Ethernet connection on the side of their heads and information flows into it at high speed. Analogs believe they could make money by erecting a paywall so they can charge admission to information. That is not how the flow of the internet works. When there is a blockage in the flow of information (that is what a paywall is) the net simply patches around the blockage leaving wall out of the network.

Posted by arcoknuti | Report as abusive

@arcoknuti That’s an apt description of the architecture, but not of the vast majority of digital people. I know this because iTunes is a billion-dollar business, because Netflix streams are the predominant traffic in prime time and because Hulu has arrived — all in spite of pedestrian pirating and P2P networks anyone can use to get anything they want.

So, the real dynamic is that the vast majority of people are willing to pay what they think something is worth, not that they expect a free lunch.

What publishers have failed to do is to enter areas where they can win, co-opt areas where they would lose, provide an experience enough customers are willing to pay for and, most importantly, gather and sustain the correct crowd, not necessarily huge, to attract advertisers — where nearly all their money is made, not $5 subscriptions.

I think you are selling people short and misunderstanding the value of both format and content. People will pay for ease of use and for elegance (why they pay Apple premium prices). We’ll see in a year whether apps are a significant publishing platform, but I wouldn’t bet against them.

Posted by johncabell | Report as abusive

“hey came from the print reading, television watching, radio listening time period and they have no idea what this Digital business is all about. ”

You automatically lose the argument for assuming that all terrestrial radio stations are commercial.

Considering we don’t have true net neutrality I suggest you support your local not for profit station. 😉

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