Sunday, March 18, 2012

Some of us knew the "free" Internet thing was a problem from the start

Financial Times has put together an article (thanks to reader Jeff for the link - also a free registration is required to read the whole article) about the future of newspapers. Among other research the article confirms a suspicion that many of the "dinosaurs" like me had from the beginning. That giving away the product for free online was a huge mistake when you were trying to sell the print product.

Here's an excerpt  from the article:

"Even the business magnate Warren Buffett, a long-time investor in the Washington Post – which does not charge online – has backed digital payments. Sitting in front of the printing presses at the Omaha World-Herald, a local paper he bought last year, he told CNBC last month: “You shouldn’t be giving away a product that you’re trying to sell.”

By putting the same content online for free that they were charging for in print, Berkshire Hathaway’s chairman said newspapers had been competing against themselves. Now, he added, “you’re seeing throughout the industry a reaction to that problem and an answer to it”.

At the time (as I have reported several times before) we were brushed off about our concerns, me personally by the genius that helps run, who told me that a free presence online was necessary and that we would see its benefit in the long run. Yes, I guess we have all seen the benefit in the long run.

The funny thing, not in a ha-ha way, is that the same people who totally screwed up the business by giving the product away for free are still there and those of us who questioned the free model are now mostly gone. The Peter Principle is alive and well.


Anonymous said...

It never made any sense to give it away free.. How many times does a customer stopping the paper have to tell you they can get it free online before you change the way you do things?

Headlines and a taste? Sure..

Pay for a subscription, and get the whole show, with extra things online they didn't put in the paper, extra photos, videos, links to related stories on your site and others etc..

I wouldn't have sold them separate, I'd make them take the print product if they wanted in.

They could have put in new single copy passwords in the paper every day to let those buyers online for 24 hours if they picked up a paper in the stores that day.

There was lot of things they could have done, going to morning delivery ten years before they finally did, pulling back the circulation area they way they kept pushing it out from 1985 and on etc..

Instead they cut the head off, and the body is laying there rotting today.

RIP Flint Journal 1876 - 2012

Jeff T

Anonymous said...

As a former Boothie who took pride in his job, gosh it drives me crazy when time after time my local newspaper likes one story so much they want to print it TWICE

Anonymous said...

As a former Boothie, I have always been dumbfounded by the idea of giving the product away for free.

By doing so, you are only competing with yourself. This is especially true for the smaller papers like Muskegon and Jackson. If readers don't want to pay for a print or online subcsription, fine. The won't get the local news. Where else can they get it? Radio and TV in small markets certainly can't provide the same quantity and quality of local coverage.

Giving your news product away for free online is like a pizza restaurant requiring dine in customers to pay but giving pizzas free to customers who want it delivered. Obviously, you'll soon find that your restaurant is empty.

Anonymous said...

I'm curious about how much charging for online content is going to help. I've always understood that subscription payments for the print paper was a break-even situation at best, to cover the paper and the delivery. What paid the bills were the ads. It seems to me that the way to make money online is figure out how to increase the ads.

Anonymous said...

I think it was a year or two after MLive was formed. A former colleague of mine at The Journal told me he no longer bought the paper because, "I can get it for free online." That comment stuck with me at the time. I'm not a business genius, but what sense does it make to give away your product for free? What successful business model does that follow?

And, yes, it still galls me to no end that the people who have been running this ship into the rocks not only continue to be employed, but get promotions - while those of us whose work was appreciated by readers have been tossed to the curb, often for kids who have no clue what they're doing.

Ty Schalter said...

Well, the problem with "why give it away for free when you can charge for it" nobody will pay.

Does anyone here really think that putting a paywall up on Mlive will drive everyone back to newspapers?


Anonymous said...

Well, the cat's out of the bag now. The powers that be in this industry - and more so at Booth than most places - made the decision to give away their product for free. It's what people are accustomed to now. Hard to say if making the site a pay site will make it profitable. The entire business model is just a disaster - and those leading the way continue to get promotions with each restructuring of the company. What other business rewards such utter incompetence?

Anonymous said...


It's not about driving people back to newspapers, it's about asking that people pay for the product whether it's in print form or on the Internet.

Reporters are producing a product -- local news stories that are not available from any other source. Newspapers and should want their readers, i.e. customers, to pay for that product.

What other industry would pay employees to produce a product and then give it away?

The problem with the "free Internet thing" is that the Mlive bigwigs believed that web advertising eventually would bring in big bucks. That has not been the case, and probably never will be.

Anonymous said...

got to agree with ty. the point is to get as many eyes on the product as possible so advertisers will feel it's worth paying for.

Larry OConnor said...

Due to my wife being in the hospital, I plunked down a buck for the Monday and Tuesday print editions of the Jackson Citizen Patriot that was being sold in the gift shop.

What a ripoff!

On Monday, there was only a couple of soft local features in the news section ("brights" I think it what the Booth editors called them) and no local stories in the sports section.

OK, I figured, maybe it was a slow news day.

So I buy the Tuesday edition and find a smattering of local news buried amid state and wire stories. Sports was marginally better with a local story or two.

Here is the rub: On the mlive website, there is a nice selection of local news and sports stories. As a news consumer, I get more by paying nothing.

What kind whacked business plan is that?!

Anonymous said...

I looked at the top of the fold of the Tuesday paper today and saw that I had already read each story they featured there online free.. Thanks Flint Journal!

Anonymous said...

I stopped buying the local newspaper when they went to three day a week delivery. I do still get it in my email, but in the last week I have been getting something in my email called Flint Real Time News, rather than the Flint Journal and this morning I started getting something called the Flint Morning Update.
It annoys me to know end that they are packaging and delivering to my email this stuff with the suggestion that it is fresh. There are a couple of new things....but nothing that can't wait until my regular email later in the day.
And on top of that, it all link back to the same old crap.

Somebody please put a fork in this state's MLive system, it's done. It's overdone. It's unedible. Untenable. Useless. As of this morning, I have now unsubscribed to the digital version as well. I will now see how long before I feel like I miss it.

Anonymous said...

Only in the rarest of circumstances do I even look at an article on MLive anymore. I, like many veterans of the business, were screwed over by that company and had our careers ruined, while people with no discernible talent or accomplishments kept getting promoted at each stage of the company's ultimate demise.

I know that MLive equates "hits" to success, so they won't get mine. I'm not missing much. The Web site was a disaster when I worked there and, from the sound of things, hasn't improved one bit. With inexperienced kids providing the content and reader comments serving as news, it's probably even worse than when I worked there.