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The California Journalism Preservation Act would do more harm than good. Here’s how the state might better help news
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Sept. 28, 2023, 11:56 a.m.
Business Models

A few years back, German publisher Spiegel decided to try something new: A cheaper Spiegel+ digital subscription just for readers under 30. It’s €2.99 per week, compared to €4.99 per week for readers over 30.

At around €12 a month, though, Spiegel+ for the young is still more expensive than the basic German Netflix subscription (€7.99 per month). A new study from Oxford’s Reuters Institute for the Study of Journalism examines how people in three countries are thinking about paying for news subscriptions, especially in the context of other entertainment they pay for. The study, by Nic Newman and Dr. Craig T. Robertson, draws on data from RISJ’s 2023 Digital News Report and also includes qualitative interviews with 110 participants from the U.S., U.K., and Germany.

Some interesting bits from the study:

— Across 20 countries, an average of 17% of people paid for any online news (via either subscription or donation) in 2023.

In 2014, the vast majority of subscriptions were for print — with digital sold as an added benefit — but today the biggest proportion are ongoing digital subscriptions of different types (46%), with around three in 10 (28%) paying for combined print and digital packages. A significant proportion (34%) have a subscription paid for by someone else, for example a parent or educational institution, or where news is bundled as part of a wider TV, broadband, or mobile deal. Just over one in 10 (12%) of those paying say they made a one-off or ongoing donation to a news service in the last year).

— Germany is unusual in having a tabloid newspaper, Bild, that successfully charges for content:

It is one of many publishers in Germany to use a “freemium (+)” model, charging €7.99 per month (or €1.99 for the first year) for exclusive news and entertainment content, packaged with video highlights from the Bundesliga.

BildPLUS has around 675,000 digital subscribers, which explains the higher-than-usual proportion of subscribers with lower income/education in our German data, when compared with the US and the UK.

(That 675,000 subscribers is significant in a country where only 11% of people pay for online news.)

— People think a lot about whether news subscriptions are “worth it” and whether they’re using them enough. Streaming subscriptions may not receive the same scrutiny:

“We have Disney+, Hulu, Netflix, Amazon Prime, currently HBO Max and Spotify, Kocowa, and BritBox. I used to have The Washington Post but it got too expensive to have all the subscriptions. We change our subscriptions up every so often to avoid paying for things we’re not using.” — F, 29, U.S., lapsed subscriber

“News is as important as anything, but if I were to cut one, I would first think of cutting my news subscription before any other.” — M, 29, U.S., new subscriber

The study’s authors note that, in addition to the “often negative and downbeat nature of news consumption,” people may consider how many members of their household benefit from each subscription: “News subscriptions sometimes compare unfavorably because they tend to be valuable to just one person in the household.”

— Younger people and older people may also simply have different reference points for what the price of news should be. Compared to a print newspaper subscription, a digital newspaper subscription is inexpensive; compared to a streaming subscription, a digital newspaper subscription is expensive.

Our sample is not large enough to come to definitive conclusions, but the role played by reference pricing from streaming services seems to be more important when it comes to younger subscribers. Some older consumers appear more influenced by the price of offline services they had paid for in the past, such as a print subscription. In that context, an online news subscription can often feel like a bargain.

“The print version [Arizona Republic], which used to be delivered to my house ‘almost’ every morning, costs over $50 a month. I consider the digital version a bargain. Also, my digital subscription isn’t killing any trees.” — M, 79, U.S, maintained subscriber

“If publishers could find a way to charge on the basis of perceived value,” the authors write, “many more people could become subscribers over time.”

You can read the full study, “Paying for news: Price-conscious consumers look for value amid cost-of-living crisis,” here.

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