Technology has become a catalyst of change and the internet has given everyone a voice and to many, a sizeable audience to boot.
“These days, when you’re talking to one person, you’re talking to a thousand,” in the words of Zoe Barnes, the tenacious journalist from House of Cards. So simply put yet so accurately reflective of the times we live in. Technology has become a catalyst of change and the internet has given everyone a voice and to many, a sizeable audience to boot. Fiction is nothing but real life overlayed with a dramatic background score and truly, adding vast swathes of digital audiences at sonic speed to their traditional reach is the reality that most news houses are now grappling with.
Avenue for revenue
Managing a news-based business is no mean feat; especially since both news and business many-a-times contradict the other’s purpose.
The newspaper industry has, for long, operated on a model where advertising brings in the money while readers pay a token amount to cover printing costs. Yet if you dig deeper, publishers have long been taking a hit as the cost of publishing escalated, but the price of the newspaper didn’t. So, what we are paying a rupee-and-a-half for, costs more than double to print and distribute. Not really a viable business proposition but there is a whole advertising piece that also brings in the revenue.
However, anyone who has worked in the advertising space knows how unpredictable and sentiment-dependent it is as a business. With the digital evolution underway, monetising content has now become a matter of survival for the media industry and it can’t afford to bank on only advertising like it did with print. For years, media houses have been giving great content out for free. Newspapers have not only been bearing the brunt of producing the content, but also distributing it for virtually ha’penny’s worth.
Sustainable business model
Great quality requires investment and only a sustainable business model based on multiple revenue streams can ensure this. There are tons of options that the industry is playing with now and the entire paywall trend that’s making headlines is just one of the routes several renowned publishers are going with. Financial Times in fact has been the very first to buck this trend since the early 2000s and sticking to its guns has paid off; it has exceeded nine lakh paying subscriptions as of last year (print and digital combined) — up from 780,000 in 2015.
More recently, there has been a horde of takers when it comes to putting up paywalls, be it The Times, The New York Times, The Wall Street Journal, Wired or most recently Bloomberg. This trend is being widely discussed right now and many are divided about how it will pan out for both the consumer and the editorial teams.
However, one thing is for certain — a change must take place. Digital cannot, or rather should not, go down the same path that print did. It can’t sustain on advertisement revenues alone, especially with the dynamics that Facebook and Google bring into the ecosystem. While the tech behemoths have been tapping into the news distribution channel, they are not concentrating on curating content. A media company must manage both sides of the charter and do so in collaboration with new competitors to not forfeit the reach and brand equity they have built over the years and more importantly, to monetise the unique content they bring to the table.
As the Chinese say, “When the winds of change blow, some people build walls and others build windmills”. Right now, it may seem like we are building walls, but we may just uncover a few windmills in the process.
-Apurva Purohit is president, Jagran Prakashan