FT editor spells out how the industry can charge for content

by Staff, Brand Republic 05-Aug-09, 09:10

LONDON - Financial Times editor Lionel Barber has said that the newspaper industry must charge for online content and has explained how rival news organisations can follow the FT.

In an interview for Channel 4 News, Barber, whose paper has opened up its service with more free content in recent years, said the biggest mistake the industry made in the past ten years was not to charge users.

Barber told C4 News: "We thought that as news organisations we could put our material out on aggregators like Google, attract a big audience and sell advertising on the back of it.

"In fact what we should have said is: 'No, information actually has a price -- it's valuable and therefore we should charge for it'."

He said the way forward was to follow the FT model and he argued rival news organisations could adapt to what the financial paper had done.

"In order to adapt to the FT process news organisations will need to have a unique selling proposition -- what is it that makes some news organisations special?

"We think we've been a pioneer in the way we've established a frequency model charging online," Barber said.

Barber said he believed the momentum behind a move to paid content was unstoppable although he said news organisation still had to make the case for paid content.

"I think people are beginning to change but it's up to us news providers, the content providers, to make that case. I think there is an inexorable momentum behind charging for content.

"For the simple reason, that (1), the advertising that we relied upon isn't going to come back in the same way, and (2), that everybody is simply just realising in this new internet age, that they need to actually charge for content and establish content as something valuable.

"What I would say to the competition and to the rest of the world is that it's getting late. If we move now we can assure ourselves of a prosperous future."

Barber added that the FT was looking at micro payments as a possible option like many newspapers.

The FT currently has 117,000 paying web subscribers, which represents 10% of those registered on FT.com.

It currently gives away 30 free articles a month to registered users on its site, which was something it introduced in October 2007.

Previously articles had only been available to subscribers. It introduced that move swiftly after the New York Times said it was ending subscription charges for its website and after News Corporation chairman Rupert Murdoch said that he was considering ending subscription charges on The Wall Street Journal.

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Comments

eskimon - 05/08/2009

It's interesting that newspapers continue to try to reinvent an existing model, rather than investigating alternative approaches to profitably delivering the benefit that they offer people. Physical newspapers are struggling to survive because they no longer deliver value - i.e. the price they charge readers and advertisers can no longer be justified when compared with alternative options. The benefit is still there, but the cost is too high. I admire the FT's online success, but it still feels like they're replicating old context in a new setting, and I wonder how long this evolved model will succeed. Perhaps news providers would have more luck if they explored radically different revenue streams, like the music industry is exploring with licensing.

Harry H Palmer - 05/08/2009

The fact that the FT subscriptions are probably all paid for by companies for their employees, and their demographic is aimed at the A, B groups with far more disposable income is one of the major reasons that the FT has been able to charge for content. I can't see, or could ever have seen an organisation with a less well off demographic ever being able to charge for content in the way he suggests.

Ally Scott - 05/08/2009

The online publishing model obviously needs to evolve to stay relevant to readers, and to continue to be able to generate revenue to fund ongoing operations. Perhaps what is most interesting for brands like FT.com are the opportunities to replace traditional advertising revenue with other income streams. Specifically building up a detailed picture of subscribers by dynamically serving them questions as they interact with the site can deliver a wealth of usable and valuable information. Content and offers can be better targeted, advertisers and partners can access data on relevant customers and target them accordingly, and the brand itself can enrich the experience each individual subscriber has, while simultaneously monetising the data it collects.

Gerard Babitts - 05/08/2009

It will be impossible for them to begin charging once they have given it away for free. It's like putting the toothpaste back in the tube. Jeff Jarvis and NPR/NYTimes' Vivian Schiller break down why this will never work -- http://www.buzzmachine.com/2009/07/28/pay-insanity/

Kevin Gordon - 06/08/2009

The FT is a successful business model. People will happily buy the information they provide. Whenit comes to the tabloids it's more a matter of micropayments because people like to switch papers. what you really need is an Oystercard for press where you can choose and pick which paper you want when you want, but you had better hurry-up and agree between yourselves before your circulation completely disappears. The press have to get together and offer tye public something they can all get their hands on. Its simple. It just works like a tube ticket. you buy x credits and invest in whichever paper youy want. That way competition is still rife. I get a little frustrated coming up with theses ideas and still being out of work. Surely someone who is being paid to sort this sort of thing out should come up with the answers, but if it keeps others off the dole queue, I'm all for it.