Murdoch will charge for all online news

by Staff, Brand Republic 06-Aug-09, 08:30

LONDON - Rupert Murdoch has said News Corporation will charge users to access its news websites, which include The Sun, The Times and Sky News, from 2010.

As well as his UK papers, a move to paid content for news would also include his US properties The New York Post and Fox News, as well as his The Australian, The Daily Telegraph and News.com.au in Australia.

He made the announcement yesterday as News Corp reported revenues of $30bn for the year.

If Murdoch moves ahead with plans to charge for The Sun and The Times he would be the first newspaper owner to do so.

If successful, the rest if the industry would quickly follow. Murdoch made his comments following reports that French daily newspaper Le Figaro would begin charging for premium online content next year.

Financial Times editor, Lionel Barber, has also said that the move towards paid content was inexorable. The FT and Murdoch's Wall Street Journal are the only two newspapers that currently charge for content.

Murdoch used the occasion of News Corp's results to reiterate his displeasure with the deal in place with Amazon.com and its Kindle e-reader device, which gives the online retailer sole access to subscriber detailers and the majority of the revenues.

Murdoch said: "It will eventually cause a break between us."

In April, Murdoch said News Corp was investing in a mobile newspaper reading device that would allow it to generate revenues, control data and effectively cut out Amazon.

Murdoch said News Corp was in discussion with Sony, which yesterday announced it was launching two low-cost digital book readers in the US. Sony's Reader Pocket Edition will cost $199, undercutting Amazon's Kindle by $100.

Murdoch predicted that if News Corp's plans to charge for online journalism worked it would be followed by other media.

He said that the success of The Wall Street Journal's subscription model, which has taken it beyond one million subscribers, had convinced him that consumers will pay for online news.

"We'll get a better share of the revenue, but it's not a big number, and we're not encouraging it at all," he said, noting that Amazon would keep information about subscribers to itself.

However, there was bad news on other digital fronts for Murdoch as News Corp reported $680m in write downs and other charges mostly related to MySpace, which has seen its value and popularity plummet in recent months.

The charges pushed News Corp down to a $203m loss for the three months to June 30, while its full-year results were in line with its forecast.

For the full year, News Corp reported operating income of $3.6bn, down from the record $5.3bn a year ago. Revenues were down 8% to $30bn, from $33bn last time.

Overall News Corp said it expected revenues to grow by 4% in 2010, while ad revenue would be flat.

Murdoch said: "I think the worst may be behind us but there are no clear signs yet of a fast economic recovery."

Murdoch also hinted at cost cutting saying the company could do more at businesses like The Times.

More on Brand Republic

Gordon's Republic: Big and bold Murdoch takes the paid content gamble

Gordon's Republic: Welcome to planet FT or how you can charge for content like the pink'un.

Comments

Andy Levis - 06/08/2009

looks like BBC news will get more visitors then. He will have to think of a more intelligent way to monetize his site

Chris Wright - 06/08/2009

A pampered generational expectancy comes to a close. The "freeter" generation will have to rethink their evangelism over content access. The cost of admin, design and production should never have been gratis in the first place. The horse has bolted, but may be coralled nevertheless. This is a logical move to ensure our business holds on to monetization of IP. Managing the culture shift and subsequent brand backlash is a challenge, but not insurmountable. We'll get used to small financial contributions to keep our virtual habits alive. It might also stop our industry imploding upon itself as revenue grows.

Patrick Danaher at GyroHSR - 06/08/2009

It will be interesting to see if the Guardian Group uses this model to save the Observer...or is it too late to ring-fence its content!

Philippa Mathers - 06/08/2009

Hoorah for the BBC online

Wilf Maunoir - 06/08/2009

Will Murdoch charge for thelondonpaper online then?

TESS ALPS - 06/08/2009

Sadly, the genuine 'news' element is probably already too commoditised. People will go to free sources like bbc.co.uk. But the other exclusive content that newspapers produce - columnists, features, analysis, *cough* Page 3 - is capable of generating micro-payments online.

Gordon Macmillan - 06/08/2009

Thelondonpaper is interesting. It is free. It will never cost anything, but its website has a lot free news. How that will sit within a paid empire will be interesting. I think more than anything it comes down to quality. At the high end \(The Times/Sunday Times) i could imagine people pay. At the more popular end \(Sun/New York Post) it is much harder to conceive.

Dr Tea - 06/08/2009

BBC online is paid for content. Current price is £11.63 per month

Jonathan Keane - 07/08/2009

The BBC website is funded by license payers, but represents 3-4% of the annual license fee \(about £0.60 per month). It would be unfair to compare this with the 'Murdoch online model'. For niche, specialist titles, such as the FT as mentioned and dare I say industry news sites such as this, people may be willing to pay a small subscription. There are, not to forget, often tie in deals with magazine subscriptions that mean online content is included. However I can't see the same being true for red top titles, where similar info can be easily replicated elsewhere and for free. Internet audiences are far too used to gaining news instantaneously, with ease and without even a consideration that they would have to pay for it. To change to a subscription model where you're trading off the ideal of a steady subscription revenue with the potential to have a massive loss in site visits and advertising inventory is a very risky tactic indeed. I'm sure the all non-News International owned titles will be eying this up closely and be looking to cease greater market share if / when it all goes tits up.

Keith Geddes - 10/08/2009

I said before.. Murdoch must be living in cloud cuckooo land if he thinks everyone will want to pay for on line news.. they may as well buy the paper.. IF they want it.. er NO.. He is in his ivory tower.. being advised.. NOT A CLUE. Big business.. we already pay to BE on line.. we pay the BBC for all their services while they`ve sold off much of their assetts.. wheres that money gone. Savings? What about the money received? Should it have come back to US.. as the departments.. sort of belonged to us? These people.. not satisfied.. well.. I`m not paying for anything more than I have to.. I havent got unlimited funds anyway.. dont want pay per view and WONT pay for news on line either. Theres some pretty fancy phrases on some of these comments. Business jargon.. its business models that have got people INTO a state in the first place.. what they HOPE to achieve.. to impress.. and are believed? Sorry, not impressed..