Wednesday, January 14, 2009

The Newspaper iPod

This week David Carr writing in the New York Times discusses the need for newspapers to generate a new revenue stream since print advertising is declining. Circulation is down and with it goes the ad buyers; of course, it doesn’t help that the two biggest sources of advertising in newspapers, car dealerships and department stores, aren’t having banner years. Since the idea of online subscription services to newspapers hasn’t met with much success, especially with the failed Times Select which I actually subscribed to, the revenue for online advertising has got to grow somehow.

Carr invokes the model of iTunes and the music industry, claiming that newspaper publishers would love for someone like Steve Jobs to show up and convince people to pay for new that they now can read for free. Of course, what do you need for that to happen? A newspaper iPod.

The thing is, Carr doesn’t realize that there already is a newspaper iPod called the Amazon Kindle. Now for a dozen reasons that I’ve been over before, I don’t think that the Kindle in its current form is going to revolutionize the way we read news. The design looks clunky and unimpressive. I have no idea what the interface is like because without shelling out $360 for my own, I don’t know how I could just test it out. Having the ability to demo a Kindle at a consumer electronic store would do wonders for the device, if it’s any good that is.

However, Carr overlooks the most troubling aspect of the newspaper/iPod analogy. The iPod only allows one to download songs from iTunes, which is owned by Apple and from which the computer company takes a cut from each sale. Amazon’s Kindle would essentially be the same model, with low subscription prices from which Amazon would take a healthy cut. Since one can only download content onto the Kindle from Amazon, the choices are limited. I recently read that the monthly take from Kindle sales of a major west coast newspaper was only a few thousand dollars; as of yet, this is not a viable answer.

I think a big issue with this model is the question of what newspapers can offer that a person couldn’t get from other news sources online for free. Imagine that no newspaper sites were free tomorrow. Why couldn’t I just check out Google News or CBS News or any other site that pays for AP stories and disseminates them? There has to be a local/regional appeal for coverage that just isn’t available many other places. Despite the fact that the Austin American-Statesman is a shitty newspaper, it’s the only game in town for local coverage. And by town here I pretty much mean universe. Without being able to persuade readers that local coverage is essential and a commitment to take some or all of their content offline without a subscription, the local newspaper is in a bad place.

The cost of real news gathering is increasing as revenue sources are headed the other way. Though the newspaper iPod is not without promise, I just don’t see the business model to make such a device succeed. The more and more I think about it, the more sure I am that the only good news reporting that will be done in twenty years will involve the support of nonprofit foundations to some extent. It’s just the only viable model I see out there.

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