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March 9, 2012, 10 a.m.

This Week in Review: Newspapers’ culture clash, and paywalls pick up momentum

Plus: Good news and bad news for Apple, James Murdoch’s move at News Corp., the value of linking, and the rest of the week’s media and tech news.

[After a week off last week, this week's review covers the past two weeks.]

Cultural roots of news’ revenue problems: Pew’s Project for Excellence in Journalism released this week one of the more interesting of its recent studies on the financial state of newspapers: It used (anonymized) private data from 38 newspapers and numerous interviews to paint a picture of how newspapers are fitting together the revenue puzzle online. The news, as usual, wasn’t good. The big takeaway stat is that for every dollar newspapers are gaining in digital revenue, they’re losing $7 in print revenue.

The Lab’s Justin Ellis pulled together some of the other highlights from the report: Mobile isn’t big money yet, digital revenue is still dominated by classified and display ads, and most newspapers have adopted Groupon or one of its daily-deal clones, with mixed results. PaidContent’s Staci Kramer critiqued the study for not touching on paid-content plans, but came up with a good (though depressing summary): “some papers are less screwed than others right now; all of them face a reckoning but some will postpone it longer than others; some papers have lots of room to grow with digital revenue because they’re so far behind; and some view running a modern newspaper as the equivalent of strip mining.”

Based on those dispiriting findings, Gawker’s Hamilton Nolan offered a few predictions for the next several years of the newspaper business: Newspapers will survive and eventually stabilize, but with much smaller staffs, ubiquitous paywalls, and a few mid-sized metro closings.

Another area of the study that got a lot of attention was its emphasis on “culture wars” between print and the web as a persistent obstacle to change. Poynter’s Rick Edmonds said a faster culture-change approach seems to be working at previously struggling properties like the Journal Register Co., but outfits that still have strong print operations need to strike a tougher balance. GigaOM’s Mathew Ingram said the best way to fight cultural inertia is to put the digital folks in charge, and Michele McLellan of the Knight Digital Media Center advised news orgs to stop ostracizing the innovators and start ostracizing the curmudgeons.

More momentum for paywalls: A year after The New York Times launched its influential paid-content plan, newspaper paywalls may be reaching critical mass. The Los Angeles Times announced a new paywall that launched this week, and like just about everyone else right now, it’s following the Times’ metered model: 15 free articles each month, then an initial charge of 99 cents a week that goes up to $1.99 a week (with a Sunday newspaper thrown in). The Times is calling its plan not a paywall, but a “membership program,” which Spot.Us’ David Cohn saw as an important rhetorical shift.

Several other papers announced moves into paid content, too: As Poynter’s Jeff Sonderman noted, the Washington Post’s new politics iPad app charges users $2.99 a month for its full features, the paper’s deepest foray yet into charging for digital content. Rhode Island’s Providence Journal launched a paywall built around a digital replica of the print edition. Gannett also announced its coming company-wide paywalls last month, which, as the Lab’s Justin Ellis reported, may be banking on the success of its smaller papers. And at News Corp., the hard-paywalled Times of London is watching The New York Times’ metered model closely, and Search Engine Land’s Danny Sullivan noticed the paywalled Wall Street Journal is pulling back on what Google readers can see for free.

All these varied developments, of course, make what the news industry calls a Trend™, so we had features on the rise of newspaper paywalls in the Wall Street Journal, Christian Science Monitor, and The Wrap. The (paywalled) Journal was pretty bullish on their prospect, while the (mostly non-paywalled) Monitor and Wrap emphasized the continued skepticism. Several small-newspaper execs chimed in supporting paywalls, including Keith Foutz at Editor & Publisher and others covered by NetNewsCheck, as did Warren Buffett, new owner of the newly paywalled Omaha World-Herald. GigaOM’s Mathew Ingram pushed back against Buffett in particular.

The Lab’s Ken Doctor took on some of the fears regarding paywalls, and Poynter’s Rick Edmonds pointed out an interesting element of the paywall rush—many of these regional newspapers are developing their plans in close consultation with one another. He focused on the Milwaukee Journal Sentinel and Boston Globe’s roles as models for other regional newspapers. Poynter’s Mallary Jean Tenore, meanwhile, looked at a practical aspect of paywall implementation—how those newspapers’ social media efforts work with (and around) their paywall plans.

Apple’s new iPad and new warning: Apple unveiled the newest version of its iPad this week, as well as an update to Apple TV. Bloomberg and The New York Times have the best summaries of what exactly Apple announced and how it differs from what came before: As the Times’ Sam Grobart wrote, this was a “plumbing event,” where the biggest innovations were under the hood with the infrastructure of Apple’s products.

For Apple, the event was about trying to push the iPad as the gateway to the “post-PC” world: It pointed out that it sold more iPads last quarter than any PC manufacturer sold of their PCs. At TechCrunch, MG Siegler said that rhetoric (and those stats) need to be taken seriously, and ReadWriteWeb’s Dan Frommer said this could be Apple’s chance to build something bigger than the PC market ever was. Larry Dignan said it’s not just PCs that the new iPad is competing with, but pretty much everyone, and Slate’s Farhad Manjoo marveled at how thoroughly Apple is dominating the tablet market.

Unfortunately for Apple, there was other news about the company this week. The Wall Street Journal reported that the U.S. Department of Justice has warned Apple and five of the nation’s largest book publishers that it’s planning to sue them for antitrust violations regarding Apple’s model for iPad ebook prices that allows wholesalers to dictate prices directly. PaidContent has a handy Q&A on the issue, and Wired’s Tim Carmody looked at the uphill battle the DOJ may be facing.

News Corp.’s culture of corruption: The developments in News Corp.’s ongoing scandal are still coming fast and furious. The biggest of those in the past two weeks was the news that Rupert Murdoch’s son, James, was stepping down as head of News International, the company’s British newspaper arm that’s been at the center of the scandal.

As The New York Times reported, the company portrayed the move as a routine jump across the Atlantic to work on its international TV properties, but others saw it as an attempt to protect James Murdoch from the scandal’s fallout. Disgruntled shareholders are still working to oust James from the company altogether, and the BBC’s Robert Preston pointed out that rather than receding from the spotlight in the wake of the scandal, the 80-year-old Rupert is actually taking on even more control.

James Murdoch’s move came after some new allegations last week from a top police investigator that News Corp.’s Sun had a “culture of illegal payments” to a broad network of government officials from the paper’s highest levels. According to the Guardian, those new allegations increased the chance of a possible U.S. prosecution of News Corp., and an 11th Sun reporter was arrested in Britain for illegal payments last week. Meanwhile, we’re finding out the phone hacking may have extended to competing British newspapers, and Britain’s judicial Leveson Inquiry, which is investigating News Corp., is also preparing to call top News Corp. execs, including Rupert Murdoch, for testimony later this spring.

The public and professional value of linking: The intermittent debate over the relative value of linking in journalism flared up again last week, leading to some particularly thoughtful pieces on the subject. It started after the Wall Street Journal didn’t credit tech blogger MG Siegler for a scoop he had, prompting a lengthy discussion on Twitter, Storified by Mathew Ingram, over whether news orgs should link to competitors who beat them to a story.

Ingram argued in a subsequent post that even if scoops aren’t as important as journalists think they are, the failure to link to a competitor’s scoop is a dishonest suggestion that they came by the information independently. Reuters’ Felix Salmon responded with an insightful piece on journalistic sourcing that concluded that such linking is usually more of a courtesy: “commodity news is a commodity: facts are in the public domain, and don’t belong to anybody.”

Mother Jones’ Kevin Drum and Poynter’s Steve Myers agreed with Salmon, while Digital First’s Steve Buttry and web philosopher David Weinberger echoed some of Ingram’s points. Weinberger argued that places like the Journal are failing to link based on a need to protect their authority over knowledge, rather than sharing it with the public, and that “Links are a public good. They create a web that is increasingly rich, useful, diverse, and trustworthy. We should all feel an obligation to be caretakers of and contributors to this new linked public.”

WikiLeaks’ Anonymous partnership: WikiLeaks made its latest document release last week with five million emails from the private global intelligence firm Stratfor, acquired by hackers from the group Anonymous who breached the company’s servers late last year. WikiLeaks worked with 25 media partners on this release, including McClatchy and Rolling Stone in the U.S. Wired’s Quinn Norton reported on the connection between Anonymous and WikiLeaks, which Gawker called the most interesting thing to come out of this leak.

Others seemed to agree — mostly on the boredom of the rest of the leak. Reuters’ Jack Shafer and Foreign Policy’s Daniel Drezner gave it a yawn, while the Atlantic’s Max Fisher called WikiLeaks a “joke” for taking Stratfor seriously. Yossi Melman of the Israeli newspaper Haaretz told the story of how he became an enemy of WikiLeaks’ Julian Assange by getting his hands on the diplomatic cables, and with WikiLeaks on the wane, GigaOM’s Mathew Ingram asked what the organization means in the long run.

Reading roundup: I’ve tried to cram a ton of news into this week’s review, so I’ll run through the miscellaneous bits pretty quickly:

— Conservative digital media mogul Andrew Breitbart died suddenly last week at 43. His imprint on the online news environment was sizable — he helped launch the Huffington Post, helped undermine the traditional media’s gatekeeping authority, and made it his career goal to “go out and create our media.”

— It’s been two weeks now, but I wanted to note that NPR put out a new ethics policy focusing on balance, transparency, and clarification, among other principles. J-prof Jay Rosen loved the changes, calling them a win for truth-seeking over “he said, she said” journalism.

— The discussion of Google+ as a “virtual ghost town” continues, with the Wall Street Journal reporting on the social network’s struggles and Google countering that image by reframing Google+’s purpose. TechCrunch’s Josh Constine explained why Google may not care if people stick around at Google+.

— Last week’s monthly Carnival of Journalism focused on the digital trends that are likely to shape journalism over the next few years, and Steve Outing’s Storified list of the predictions is a great array of thoughts about what’s next in the field.

— Finally, a couple of cool resources: One from the Columbia Journalism Review on countering misinformation in the news, and another huge set of tools and tutorials for journalists and programmers from last month’s NICAR conference.

Rupert Murdoch photo by World Economic Forum, chain link photo by Cayusa, and Anonymous mask photo by Luciano Castillo used under a Creative Commons license.

POSTED     March 9, 2012, 10 a.m.
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