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In March of 2011, The New York Times announced that it would start charging readers for digital content. The announcement came from the publisher of the Times, Arthur Sulzberger, Jr., who wrote that the shift away from offering all the Times’ online content at no cost was “an important step that we hope you will see as an investment in The Times.”
The decision to erect a paywall had come after long and sometimes difficult debate, one that was taking place in news organizations around the world. There were, of course, the business considerations: Charging for access meant an inevitable drop in traffic. And with that drop would come a loss in interest by advertisers, who had become accustomed to being able to reach tens of millions of potential customers at a fraction of the cost of a print ad. But beyond the debate about the potentially catastrophic loss of digital ad dollars, something else was at play: an existential debate about journalism’s future.
In one camp stood those who argued, passionately, that The Great Disruption had ushered in an exciting age in which information could be sent hurtling around the world at remarkable speed, reaching audiences never imagined. And if information was the lifeblood of an engaged citizenry, the implications for democracies around the world, and for people striving to achieve democracy, were thrilling.
But what of the news provided not through Facebook and Twitter by activists and citizens, but gathered and crafted and distilled by working journalists? Those journalists, went the countervailing argument, do not work as volunteers. They take risks and possess skills that separate professionals from “citizen journalists.” Professional journalists, the argument concluded, possess valuable skills that serve the very citizens who advocates of free and open information are committed to reaching.
The operative word is valuable. Because, the reasoning went, if news was valued, then people could pay for it, the way they paid for all the things in their lives they valued.
Therein, however, lay a problem. Cars, toaster ovens, wallpaper, steaks, and milk had never been free. Nor had printed newspaper and magazines. But news in digital form had. In the early days of the disruption, news organizations happily loaded their content onto websites that they made available at no cost. They were confident that while it was important to have a “digital presence,” print was where the advertisers had always come and spent their money.
Until they didn’t. Or, more precisely, until they began directing more of their display advertising away from print and network television, and toward digital, where the rates were perhaps a seventh the cost. Which, in turn, made it imperative to have as many people as possible visiting a website, which meant doing nothing to impede that rush of digital traffic. Like imposing a paywall.
The loss of that display and, with the coming of Craigslist, classified advertising, meant a drop in revenue, which meant growing impatience among investors who had bought shares in the belief that news organizations would continue showing steady growth and profit margins approaching 30 percent. The only apparent solution that so many newspaper publishers and others in the news business could envision was to lower costs, quickly and dramatically, by cutting into the biggest share of the budget—payroll.
That strategy, of course, changed the nature of the products that news organizations were generating. For all that editors talked about doing “more with less,” this mantra—heard often in the early days of the disruption—flew in the face of the laws of physics. Less does not equal more; less equals less. If customers grow used to a product that arrives meeting certain expectations and that product begins to feel like something less, the customer may well stop valuing that product, be it a dishwasher, a take-out dinner, or a newspaper and its website.
Yet publishers and owners believed they had no choice. No amount of warning could dissuade them from diminishing the value of what they were trying so hard to keep selling, and which readers, in distressingly growing numbers, were not buying.
So it was that by March of 2011, the Times signaled that it would take the considerable risk of altering the unwritten compact with its readers and charge them for access. The Times was by no means the first news organization to do this, but because it remained the nation’s premier newspaper, the implications were enormous.
The Wall Street Journal, had been charging for access since 1996—a decision that had opened its publisher at the time, Peter Kann, to no end of in-house eye-rolling from his young, digitally oriented colleagues who thought him hopelessly un-webby. Still, it was one thing for the Journal to charge because the Journal was regarded as a special interest publication whose core readership—the business and political elite—could afford the subscription (and put it on an expense account). The Times, elite as many of its readers were, was still an omnibus, all-purpose newspaper.
By the winter of 2009, a particularly dark time in the news business—a period when part of every journalist’s workday was spent checking Jim Romenesko’s blog to see where the latest round of layoffs had struck—the debate took on extra urgency when Time published on its cover an essay by its former managing editor, Walter Isaacson, arguing in favor of instituting fees for access. While the advocates of free and open information insisted that paywalls were a losing proposition, and that the print newspaper was doomed, there was growing evidence that while a hard paywall was not necessarily wise, a hybrid model might work—say, give away 80 percent, and charge for 20 percent; or perhaps institute a “metered model,” where readers could read, say, 20 stories a month at no cost but would be charged for each subsequent piece.
The metered model was built on an intriguing conceit: that readers would so enjoy or admire those free-of-charge stories that they’d willingly hand over their credit card information and allow themselves to be charged for more. The paradigm, after all, had worked for, among others, Netflix and Hulu, to say nothing of premium cable TV.
This suggested a certain irrationality on the part of consumers, an argument endorsed by Peter Fader, a professor of marketing at the Wharton School at the University of Pennsylvania. Economists, Fader believed, often make the mistake of building projections upon the supposition that people are rational beings. But people, he explained, will commit the irrational act of paying for all kinds of things that they can otherwise get for nothing. This brought to mind people choosing iTunes, in favor of a bootleg, free download. Why? Because for 99 cents Apple made the experience a nice one, easy and convenient (and yes, legal). Such qualities, Fader argued, can supersede price.
Passionate as was the argument for free content, there was growing evidence to support the idea that people not only would pay, but already did. They paid for the Journal. But they also paid a lot of money—as much as $10,000 a year—for access to Congressional Quarterly’s bill tracking databases. They paid for Cook’s Illustrated. They paid for…Orangebloods.com.
Orangebloods is a website that covers all known thought about the University of Texas football team, and in 2009 when I checked in, some 8,000 subscribers paid $100 a year not for game coverage—which they could find lots of places, at no cost—but for access to behind-the-scenes news (scouting, spring practices, everything) as well as to something perhaps even more important: membership in a network of kindred spirits. Orangebloods’ success was predicated on never being beaten on a story (which is why it employed professional journalists) and maintaining its position as a gathering point for all those fans who saw value in what Orangebloods.com offered.
In a lot of ways readers don’t know what they want. They think they want all local news. But that’s not what they want. They’re looking for information. They’re looking for a story.
Like Orangebloods, all those other examples of walled-off destinations had one of two things in common: Either they were the only source of information around—for instance, the Arizona Republic, that state’s dominant news source—or they were built to satisfy the needs of an engaged and specific community, be they investors, amateur chefs, lobbyists, or college football fans.
In reversing the decision it had made four years earlier, the Times was essentially telling its readers, and advertisers: We believe what we produce is valuable; if you value it, too, it is yours at a cost. Publishers held their breath, wondering what this would mean for everyone else? What if the plan failed and readers so used to free balked at paying? What might this portend for the future of a business desperate to find new ways to support itself?
The news business had never been forced to confront so directly the question of its value. Journalism had long enjoyed Thomas Jefferson’s blessings and the First Amendment’s protection. The industry, once populated by men who had not graduated from high school, had become a discipline taught in graduate programs. Journalists saved lives, gave voice to the voiceless, and toppled heads of state, and though people may not necessarily have liked how reporters nosily went about their business, they nonetheless found them useful when problems arose and were reminded, once again, of journalism’s societal value.
Of course, there had always been a lot of bad journalism—sleazy, conniving, dishonest, manipulative, tawdry journalism. And while those sorts of publications were deemed of little social or journalistic value they nonetheless possessed what in business school is called a “value proposition.” People paid for them.
As disruption unmoored the basic operating tenet of the news business—simply put: that advertising, not readers, pays most of the bills—editors and publishers were confronted with a question that few, if any, of their predecessors had ever felt compelled to ask, let alone answer: Is what we produce and sell still valuable? Not “important.” Not “worthy.” Valuable.
The question brought to mind my conversation in December of 2005 at the annual media analysts gathering in New York with Eugene Gardner, Jr. Gardner was an analyst who lived and worked in Lancaster, Pennsylvania, on the far reaches of the Philadelphia Inquirer’s circulation zone. We spoke about the newspapers he read—the Journal, the Times, two Lancaster dailies—and the one he did not, the Inquirer, which, he explained, offered him little. I asked what the Inquirer might do to lure him. The answer did not come quickly. Perhaps, he finally suggested, the Inquirer might project what in his view it lacked: a voice.
He raised an intriguing point. All publications, of course, believe they possess a voice, just as all people believe they have a personality. But not all voices and personalities are compelling. Some people spend a lot of time and a lot of money working to become someone new and thereby more pleasing in the eyes of more people. Sometimes this works, for a little while. It does not feel too much of a stretch to suggest that news organizations, like men and women saddled with self-doubt, had spent a lot of time in recent years asking people what they wanted.
As the Inquirer learned though its focus group research, readers typically will say they want everything, which led to such decisions as doubling down on local coverage because a slightly higher percentage of readers preferred local stories to stories from overseas. This was a rational decision. But perhaps a bit too rational. As it is with a failing relationship, an accumulation of admirable personal qualities do not a love match make.
So it is that a defining “voice” does not, by its nature, reflect a consensus. It reflects risk—the risk that that voice will fail to be heard, or appreciated. The risk of failure, of course, can be diminished by asking, “What do you want?” The act of asking—in matters of business as well as of the heart—is safe and prudent, but it is not compelling. A “voice” does not ask, “Does this work?” It dares to say, “I know.”
In the spring of 2005, several months before that conversation about voice with Eugene Gardner, I went in search of a newspaper that possessed just such a voice. I found one in a journalism backwater, Virginia, Minnesota, where Bill Hanna ran the Mesabi Daily News.
I had flown to Duluth and then driven an hour north in the hope of finding a newspaper that people felt compelled to read, edited by someone who insisted that the romance and excitement that brought him—and me, back in 1976—into this business was not dead. For weeks, I had asked everyone I knew whether such a place existed. Then someone sent me a note from someone from a Minnesota newspaper association who said she had heard of, but knew little about, a small paper in the middle of nowhere that was said to do good things.
I went to the paper’s website and found myself in the middle of the contretemps surrounding the firing, after 17 years, of the director of the town’s animal shelter. The more I read—and there was a lot to read—the more my heart soared. The Mesabi Daily News had decided to own this story. Or, rather, Bill Hanna, the paper’s editor, had decided it would. If the coverage made readers angry, they were free to complain, and they did. After 10 days of relentless coverage he published their letters. Then he replied:
“It does no good for any of us in this business to urge readers, ‘Hey, don’t shoot the messenger.’ It comes with the territory,” he wrote in a column. We will, “continue to be the messenger on the issue when warranted—in other words when there is something new to report. And I’m sure there will also continue to be more firing directed at the messenger. That’s fine, we can take it.”
Bill Hanna was from Northeast Minneapolis, and in the region known as the Mesabi Iron Range this made him an outsider. No matter that he had been in town for 20 years. He was 54, divorced, lived in a rented apartment in downtown Virginia, and spent so much time in the office that it was pointless for any of his staff of four reporters, two editors, two sports writers, and one photographer to try to arrive before or leave after him. His office was too small to be anything but a mess. The paper had won so many national and state journalism awards that the crowded walls of the claustrophobic newsroom could fit only the first-place citations. The Daily News’ circulation had been falling by 1 to 2 percent a year but still hovered at about 10,000, which was remarkable when you considered that the population of Virginia, Minnesota was 9,000.
The pay was lousy—reporters made between $17,000 and $30,000 a year. But in return Hanna gave them the freedom to report on most anything they wanted. He did not have story quotas. He did not send them to night meetings, or remand them to take obits—he took some himself. He wanted big stories, and if his reporters wanted to write columns he encouraged them. The Daily News was nothing if not inconsistent; it would devote a quarter of the front page and half an inside page to a four-part, two story-a-day series on drugs and violence on the Iron Range, only to be followed by stories sorely in need of a copy editor. It could be, at turns, bold and goofy. People loved the paper and hated the paper.
Hanna was easy to find. He might be at Popper’s, one of the 16 remaining bars on Virginia’s main street, where people were free to come by and tell him what they thought of his paper. He had a feel for his adopted town. His editorial approach was decidedly old school: strictly by the gut. The animal-shelter firing had everything he could ask for in a story: animals, a sympathetic character, and an unresponsive bureaucracy. It also, in Hanna’s view, represented a wrong, and part of editing a newspaper meant correcting what he believed was wrong. Bill Hanna had his favorites, and those who were not among them had unkind things to say about him. He had, for instance, missed arguably the biggest story to hit the Iron Range in years—the sexual harassment lawsuit brought by women miners that became the basis for the book Class Action, which was adapted into the Charlize Theron movie, North Country. He had let that story go; he knew it and regretted it. But that did not alter his approach of making the editing of a newspaper a personal matter, which in turn allowed him to violate the received wisdom of what a local paper should be.
The Daily News was filled with political stories—and not only local politics, but dispatches from stringers in Saint Paul and from the wires in Washington. Hanna believed that limiting the scope of stories he offered his readers was insulting. His view was confirmed by the paper’s marketing director, a lifelong “Iron Ranger,” Shelly Lindberg, who told me that, “In a lot of ways readers don’t know what they want. They think they want all local news. But that’s not what they want. They’re looking for information. They’re looking for a story. It’s a subconscious thing. They think they want local, local, local. But they don’t feel good about buying it. They’d say it was a hick, marginal paper.” Her view, heretical in the newspaper business of the time, was echoed by a local advertiser, the marketing director of a local bank, Rhoda Steblay, who said that as someone competing for business with larger banks she did not want to advertise in a paper that was small-town in its thinking.
By contrast, nearby Hibbing had a population of 18,000 and a daily paper with a circulation far below that of the Daily News. The Hibbing Daily Tribune was not a bad paper when I read it in 2005. It was safe. The experience of reading it was akin to a first date, one that was not going to lead to a second; no spark. Bill Hanna—cluttered, contentious Bill Hanna—offered a paper that was anything but safe.
In spring of 2005 the Mesabi Daily News’ profit margin exceeded 25 percent. In the view of its 10,000 readers, it was fair to say, the paper Bill Hanna gave them offered value.
The Great Disruption is not the first time journalism has been upended, and it is worth pausing in the midst of this ongoing disruption to look back. The last great disruption in the news business began in 1918, with the debut of the New York Daily News, which redefined news and the way people consumed it. Its founders, Joseph Patterson, and his cousin, Robert McCormick, the publisher of the Chicago Tribune, had modeled the Daily News after Lord Northcliffe’s London Daily Mirror, the world’s first tabloid (the word “tabloid” derived from medicine that now came not in powdered form, but in little tablets).
At the Daily News, news meant lots of photos. It meant “society news” on page six, five-dollar “stranger than fiction” stories from readers (“no attention will be paid to literary style”), advice columns (“Keep Kids Well”), and all sorts of contests—“Bright Sayings,” “My Funniest Motor Experience” (neither of which proved a keeper), and “Most Beautiful Girl,” which did.
The idea was to make the experience fun, and easier. Gone was the broadsheet. In its place came a newspaper half the size. But something far more significant was taking place than merely choosing “Gasoline Alley” as a comic strip. The business side of the News had dispatched to Manhattan’s Lower East Side a scout. Enter into the journalistic Hall of Fame the name Sinclair Dakin, who returned from her scouting with news akin to the true discovery of the Lost City of Gold: a vast and untapped market of readers. The neighborhood, she reported, was no longer the downtrodden immigrant district of the past. There were, by dint of more restrictive laws, fewer immigrants. But those immigrants who remained had, over the past 20 years, steadily made their way up the income ladder. They had money to spend. And they had children who had emulated them in the race to assimilate. They worked. And they read.
That reader was given a name: Sweeney. And at the paper, a guiding maxim evolved: “Tell it to Sweeney.” The Daily covered stories of interest to Sweeney, like organized labor and a lot of sports, too. It gave him newsier photos. It provided him with “Help Wanted” ads. And, perhaps most importantly, it gave him a voice—from the “Vox Pop” column to the Love Story Plot Contest. It worked. In time, the Daily News became the most widely read newspaper in the country.
The Daily News lives on as a diminished version of its once big, proud self. Its world, like the world of so many of its competitors has been upended. As it was for the News almost 100 years ago, new publications have discovered new markets where people see value in what’s being produced. There are still newspaper men and women of a certain generation—read: mine—who see nothing less than the devil in Craig Newmark for having created a business that eviscerated newspaper’s monopoly on classified ads. They decry the rise of BuzzFeed, and all its many cat photos and “listicles.” They forget that in 1990 the behemoth that would become Bloomberg News consisted of six employees who thought that there might well be a business in selling exclusive financial news to wealthy clients through $20,000 terminals.
The mistake in trying to make sense of the seemingly relentless waves of disruption is in looking only at the technology itself. The technology is the means, not the end. The end, now as it ever was, is understanding that which never changes, and never will: the subtleties of human nature. The Great Disruption did not change people. It gave them new ways to do what they had always done. To read faster. To learn things more quickly. To tell their friends. To speak their minds. Before it was said that Apple produced products that people did not know they needed, the same was said of Sony. It might well have been said of IBM and before that General Electric.
To that end, I can think of no better distillation of what exists at the heart of the relationship between journalism and its audiences than the phrase that Lisa Gubernick, a wonderful journalist at Forbes and the Journal, used to open every single conversation, professional and personal. She would ask, “What’s new and interesting?”
In a way, it really is that simple. We, the readers, listeners, and viewers, want both. We will settle for one: new for what we need to know right now; interesting for the delight we experience in surprise, in discovery, in knowing. The question that Bill Hanna is forever trying to answer, and which, at its core, every news organization is trying to resolve most every day is: What can we offer our audience that they will value because it is new and/or interesting?
The Great Disruption has not created a new species. It simply allows people to act in ways they may not have thought possible, but which, when they are presented with the opportunity, make all the sense in the world.
In the spring of 2015, four years after it imposed its “metered model” paywall, The New York Times had more than 900,000 digital subscribers, and seemed on the road to a million of them. The Los Angeles Times has a paywall now. So, too, do The Dallas Morning News, Newsday, the Houston Chronicle, the Orange County Register, the Star Tribune of Minneapolis, the Philadelphia Inquirer, and hundreds more.
This is not to conclude that paywalls are the answer to what ails the still ailing and reeling news business. They are, however, a way of thinking in the face of cataclysmic change. They are a statement, a marker thrown. They say: We are committed to producing a publication of value and if you value it, it comes at a cost.
Sadly, but perhaps inevitably, it took the pain of The Great Disruption to see that. Or, perhaps, to be reminded.
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