Free online content ensures readers, but not money. Paid content might snag some money, but not many readers are willing to pay. It’s a tough scenario, and as we speak the print industry is trying to decide on the best way to monetize the changing nature of consumer news consumption. The debate between paid versus free, if it ever really faded away, has been brought back to the forefront by developments such as the iPad and the highly publicized decisions of publications like The New York Times to erect pay walls. I’m not going to jump into that brawl in this post, but I did want to share a very interesting view on the situation and one that hasn’t received much attention.
Howard Gossage was an advertising executive in the 1950s and 60s (yes, like Don Draper), and he wrote a very interesting essay on the basis of print journalism. In the early days of the industry, newspapers and magazines relied on readers for funding. If a consumer believed that the content was worth it, he paid. As advertising came of age, the publications all of a sudden found a new source of income, and as circulation grew so did ad revenue.
Eventually, Gossage writes, “Two opposing economic spoilsports – rising production costs and competition – started to ruin the whole lovely thing.” To keep readers the papers had to keep prices down, but costs were driving the price up. The industry “committed itself to an increasingly irreversible course,” and chose to sell the content for less and pander to the advertiser.