The survival of news in the digital world
Judged by the ubiquity of content and the abundant availability of formats, the news business appears to be in rude heath, but the funding of quality journalism is becoming an increasingly urgent issue. Most media businesses still derive the majority of their revenue from traditional formats, but consumption of print and TV news is in decline, especially among young people, while burgeoning digital advertising revenues are being captured by the technology giants.
News organisations therefore need to develop new business models, fuelled by innovation in the monetisation of their offer. They also need to persuade consumers to pay for online news. Yet, with so much online content available free of charge, news as a product has been commoditised.
Where then does consumer value exist in online news? There are six areas that may be leveraged.
1. Unique content – People are more likely to pay for exclusive and specialist content because there is value in scarcity. There is also value in evergreen content that remains relevant beyond the ebb and flow of the daily news cycle, as well as in variety, which allows serendipitous content discovery.
2. Content experience – There may be value in providing a superior consumer experience: online news that is incisive and offers deeper analysis of macro issues, while being digestible and compellingly composed by writers of repute.
3. Functional experience – Apps provide convenience and should be customisable for a frictionless experience. Superior functionality also promises potential for premium options that offer added value to consumers.
4. Easy availability – Technology allows seamless use across platforms and devices. Furthermore, payment and other funding options could enable stratified access, while reach could be extended through bundled offers.
5. Brand – A reputable brand signals trustworthiness. It promises quality journalism: superior writers with refined storytelling skills, distinctive tone and style, and authoritative voice.
6. Plurality – The different views and perspectives that come from multiple sources and brands, which online news facilitates, is one further way in which consumer value might be realised. A subscription aggregator could deliver plurality and put news on the trajectory of evolving technology, while keeping payment decision-making simple.
Although the increased salience of fake news and concerns about online echo chambers have helped some reputable news organisations over the past year, a persistent glut of free content is likely to continue to deter many people from paying for online news. Commercial revenue will therefore continue to have an important albeit diminishing role.
This funding needs to balance the friction imposed by assorted advertising formats with the blurring of editorial-commercial boundaries that characterises sponsorship in its various guises, allowing consumers smooth navigation of editorial and commercial space without confusion.
Jason Vir, Director, Kantar Media
For a longer read, the full paper is here. This piece is based on a PDRF conference paper and research on Attitudes to Paying for Online News conducted by Kantar Media for the Reuters Institute for the Study of Journalism, University of Oxford.