I suspect this post is going to come off disjointed and somewhat scatter-brained – because that’s the way my morning is going. However I’ve wanted to comment on this since first reading about it yesterday and haven’t managed to find the time, so here goes.
Recently Rupert Murdoch announced that he is now looking to implement charging models for News Corps’ online news publications, arguing that it’s been costing them a fortune to give away the content for free.
According to CNN, Murdoch added:
“We have been at the forefront of that debate and you can confidently presume that we are leading the way in finding a model that maximizes revenues in return for our shareholders… The current days of the Internet will soon be over.”
My view on this, in short, is that it’s an incredibly stupid and arrogant idea that is destined to fail. First and foremost, as Michael Tomasky from the Guardian points out:
“You can charge global financial elites to read a tailored product of financial news….But can you do the same with regular readers, to get them to read general-interest news? The universal experience has been that you can’t.”
My theory on this can be attributed to a couple of arguments.
First and foremost is the availability of substitutes. Prior to the explosion of the internet people had access to relatively few sources of information. The primary media were TV, radio, books, newspapers. Of course these streams of content and news still remain intact, but to downplay the impact and opportunities that the internet now afford readers and users is a fool’s errand.
The way people interact with news and information is different than it once was. As an article that I read recently (but unfortunately can’t find) suggested, people now largely read individual stories, not entire newspapers. When you combine this with the power and speed with which search engines, and peer-based recommendations enable the location of alternative sources of content – you have a landscape where readers and users now wield more control than providers of content.
So for Murdoch to go even further and say “The current days of the Internet will soon be over” as CNN quoted is an incredible overestimation of his influence and importance – but more than that it’s a glaring symbol of how little he understands the web and the people who use it.
It is a clear indication of a man who is stuck in an old paradigm, where media monopolies and a reader’s role as passive receivers of information meant that media moguls had a tremendous amount of control over supply and therefore price. We’re in a very different media landscape now; the rules, realities and expectations are different.
Point number two is free access to content and services becomes the assumed and defacto norm for most people. Start-ups face this issue constantly. Unless they come up with a compelling reason to subscribe to paid content, most people don’t and won’t. For sites that attempt to move from free models to paid ones this is an even more trecherous path.
The Guardian’s point about the experiences of the New York Times is particularly relevant here:
“The New York Times tried it and got hammered. It charged for so-called “Times Select” content – most prominently the paper’s famous opinion columnists like Paul Krugman and David Brooks – for a little while, hoping to crowbar $50 a year out of saps like me.”
Basically, Murdoch’s error results from several failures and incorrect assumptions – failure to consider the significance and scope of available substitutes, failure to consider the experiences of other media providers, a lack of awareness of contemporary trends in media consumption, and a total cluelessness about the dynamics of the digital culture.
The current days of the Internet *will* soon be over if we lose net neutrality and are subject to tailored ISP content packages or deep packet inspection. Rupert might have little trouble charging if such moves restrict what we can read and write.
Very good point Jim – all the more reason to ensure the internet caters to the needs of the many in a democratic way that’s not influenced by the financial interests of corporations, ISPs or specific countries. The internet is here for everyone and shouldn’t be subjected to the whims and self-interests of the few.
I fully agree, Mike: an open Internet is vital for participatory culture and democracy. But the struggle to save it is not going well at present. See http://bit.ly/5e3aM for a summary of recent European Parliament votes which could allow net discrimination.
I just read the article you mentioned. That is really bad news; and I find it both surprising and incredibly disappointing. The logic and motives that drive policy makers to consciously implement decisions that will undoubtedly lead to restrictions on freedom and opportunity for citizens is unfathomable and just deplorable.
Even when giving these politicians the benefit of the doubt, they are still putting the interests of business ahead of those of the wider population. That’s just shocking.
Thanks for bringing this to my attention. I’ve got some reading and research to do now.
This is an interesting take on the discussion from an Australian perspective:
ZDNet – Net neutrality is an ‘American problem’
The gist according to the article is that the issue in the US originates from a flaw in the ISP business model where internet subscribers are given unlimited download options, whereas Australians have distinct caps. What is downloaded is irrelevant, however if and when you do reach the cap, you either drop down to dial-up speed (56K in my case), or you pay extra.
It seems to me that this is a fair compromise. Users are free to access whatever information or content they choose to so long as they adhere to their cap. So they retain their freedom to participate and consume, while ISPs don’t take it on the chin when download rates spiral out of control and well beyond what they’re earning.