Lionel Barber, the FT editor is a thoughtful man and has certainly had success with building a partial pay wall around FT online content — you pay if you want to access more than a handful of articles a month. The FT has 110,000 subscribers and over a million who make do with a few reads every month. But he may be a tad over-optimistic when he forecasts that within a year most authoritative news will be protected by pay walls.
As is clear now, the current business model for news organizations in the online age doesn’t work. Free access and advertising is not paying the bills. But throwing up pay walls will reduce the number of readers and turn off advertisers. Will subscriptions make up the difference and provide the income for expensive news-gathering operations? Well it didn’t when newspapers really were newspapers. Back in the old days most top newspapers made only a fraction of their income from news-stand sales and deliveries. The big bucks came from advertising. Why should it be any different online?
Another point worth making. Pay walls may undermine news aggregators but the middle ranking newspapers — and further down the line, the bottom feeders — may well be prepared to pay the price of subscriptions in order to re-write the material. This is what newspapers have been doing for years with AP, Reuters, AFP and PA and slapping a false by-line on the results.
Barber and the pay-wallers will have to take into account the news organizations that don’t have pressing need for advertising and subscriber revenue — namely, public broadcasters like the BBC and NPR.
A sour point. Barber should stop being snooty about bloggers: some are former journalists, others are developing their craft and evolving much as Grub Street did in the 18th century.