The Times Charges Ahead

New online business model will help the press serve the public good
Early next year, when the New York Times begins to enforce a metered system in order to charge for its online content, millions of readers will have to decide if that content is worth the price. For a few short years, the Times has been available at no cost online, even as it and the entire journalism sector have suffered major financial difficulties. The new online business model may help put the ailing newspaper industry back on course, and without hurting access to information.
The Times has given itself a year before it implements the recently announced change, and it provided few details in its announcement, in part because the “logistics are being worked out and decisions are still being made,” as Richard L. Berke, the national editor, told the HPR. What is clear is that there will be a metered system, meaning that a user’s first few articles up to a monthly limit will be free, after which the user will have to pay. Such a system is more similar to that of the Financial Times than to the pay-wall of the Wall Street Journal, which makes some articles free and requires subscriptions for others. The number of free articles and the price of additional articles or subscriptions may change over time, but the metered system should not be considered experimental. As Berke told the HPR, “This isn’t something I think we’d turn back on anytime soon.”
CHANGING WHAT YOU READ

Naturally, a price on access to the Times website will decrease its readership among those least willing and able to pay. But this does not necessarily mark the end of equal access to information. Although many news organizations are expected to charge for online content if the Times’ restructuring proves profitable, not all will. Maralee Schwartz, national political editor of the Washington Post, told the HPR that Katherine Weymouth, the Post’s publisher and CEO, “does not believe in charging for online content.” Schwartz also said that the Times’ decision to charge may be “an advantage for the Post.” Indeed, some online news sources may stay free precisely because they are looking to pick up traffic from metered sites.
The Post’s decision not to charge for online content should quell any fears that we are headed into an era in which independent bloggers will be the only free online news sources. Professor Nolan Bowie of the Harvard Kennedy School explained the dangers of such a scenario: “Journalists, not newspapers, are the essential public goods, and we can’t rely on unpaid professionals.” Opinions may differ on just how necessary paid, old-school journalists remain, but in any case there is no reason to think that the Times is spelling the end of accessible and credentialed journalism.
For these reasons, access to broadband Internet, rather than access to the New York Times’ online articles, will remain the main obstacle to equal access to information. As Walter Isaacson, President and CEO of the Aspen Institute, told the HPR, “Online newspapers, even if they charge, will be much less expensive than paper. … The main issue is getting broadband Internet access to all levels of society.” Free online content is not actually free; it just has no marginal cost. As more of our press moves online—for example, the Detroit Free Press has limited home deliveries and shrunk the size of its physical paper—broadband access will become ever more important for staying well-informed, and a subscription to the New York Times’ website, compared to broadband, will cost relatively little.
CHANGING WHAT THEY WRITE?

As newspaper readerships and revenue sources change, it is important to consider whether and how content may change. The newspaper industry insists that readership and revenue do not affect content; as Berke said, “[We] want an audience, but our basic journalistic decisions are based on journalism.” Even if business considerations actually do affect content decisions, the shift to new revenue streams could actually improve the quality of news coverage. Isaacson explained that a shift towards dependence on users—rather than on advertisers—could lead to an increase in the number of sites serving “an audience that wanted straight and credible news” instead of an audience seeking articles “telling [them] where the best golf course is.” Advertisers like rich people, and so news outlets that want advertisers often need to cater, at least in certain sections, to the tastes of the wealthy.
If the Times‘ online business model proves profitable, it may even subsidize the paper’s primary public service: investigative reporting. For decades, newspapers’ advertising and subscription revenues supported such services, but recent financial troubles have led to cutbacks. For example, the San Diego Union-Tribune closed its Washington bureau shortly after winning a Pulitzer Prize for its investigations into former congressman Randy “Duke” Cunningham. Now,  if new sources of revenue are effective, news organizations may be able to afford their investigative bureaus. As Schwartz explained, “Every news organization has to do what’s going to support its own type of journalism best.”
JOURNALISTIC DIVERSITY
But each organization defines its type of journalism differently, and that diversity is important to ensuring that information is widespread, accurate, and not subject to control by a few. Big media corporations, Bowie explained, have large professional staffs and “safety nets through litigation insurance,” and thus maintain a comparative advantage in investigative reporting. Small media outlets help ensure that the flow of information is not controlled by a select few. If different sources of revenue do not lead to different journalistic decisions, then a profitable new business model will help support the existing types of journalism. But if the source of revenue does affect content, then, according to Isaacson, “a mix of models—some free, some ad-supported, some user-supported, and some a mix—will give us the greatest diversity [of content].”
In the history of America’s press, free access to an elite newspaper is an unusual phenomenon to say the least. And the experiment with free access has severely hurt the journalism industry; for the past few years, it has become increasingly clear that newspapers must either change their revenue tactics or face extinction. Now the New York Times’ new online business model may give us the best of both worlds: the diversity of the Internet, and the trustworthiness of the old media.
Jeff Kalmus ’12 is the Webmaster.
Photo Credit: jphilipq (Flickr), Funky Tee (Flickr)