Gannett paywalls: suicide or savior?

Edited at 11:48 AM on 25 February to add a reference to the hiring of digital staff. Thanks to @HenryHoward for pointing out that omisssion.

Full disclosure: I am on the Reader Advisory Panel for, and am an uncompensated contributor to, my local Gannett property. While I have several friends at the Journal and Courier, I do not claim any particular inside knowledge of the workings of that paper, nor of Gannett in general. My opinions are my own and stem from my observations as a subscriber and once-monthly visitor to the conference room. I am no expert on the business of journalism.

Earlier this week, the Journal and Courier set up a paywall for online content. It is an early adopter of what appears to be a Gannett-wide initiative to limit online access to subscribers. There are several fairly trivial tricks available to circumvent this paywall, not to mention the simple use of multiple devices/browsers, which suggests to me that they’re not super-serious about enforcing access. Technological workarounds aside, there has been some heated discussion locally.

To some degree, I feel bad for the staff at the J&C. The staff have worked diligently in the face of layoffs, furloughs, and budget cuts. Locally, at least, the realization was made that they can no longer be a newspaper, but a newsoutlet. To that end, they’ve embraced (some more than others) real-time reporting via Twitter and additional analysis in blog posts. Online databases have been added, including public salaries, property tax information, and even pet registrations. The local staff get it, even if they’ve been hamstrung by corporate mandates.

For years I’ve been saying “give me a full version of the paper that I can read on my phone, and I’ll stop making you print a dead-tree version for me.” Of course, the local staff had no control over that, but Gannett finally decided it was time to make that available. They even have an iPhone app. The Android app is “coming soon.” (As a sidebar, I think it’s pretty stupid to not have an app ready for Android at release, considering Android’s market share is fairly close to that of iOS.) A generic tablet version, which isn’t quite as responsive is also available via a dedicated URL.

Given the financial difficulties, it’s no surprise that the staff seem to mostly support the paywall (or are at least unwilling to publicly speak against the company line). They really want to get paid for their work, and I don’t blame them. The real problem, in my opinion, is taking something that was once free and making it no longer free. There seems to be general agreement that local news is useful, but the amount people are willing to pay is less unanimous. Some options, like local news stations, remain free.

Over-the-air TV is free because it is paid for by advertisers (i.e. viewers are the product, not the customer). With newspaper historically, and newswhatever-Gannett-becomes in the future, the model is a little bit different. Ad sales help subsidize the cost, but do not cover the entirety. (I’ve heard, but cannot verify, that ads cover most of the cost of producing the content and that newsstand and subscription fees cover the delivery costs. It certainly makes sense, especially considering that there is an increased distribution cost per subscriber, whereas a TV antenna only gets cheaper on a per-viewer basis as more people tune in.) There is unquestionably value in original, professional local reporting and providing that content is not free.

I do believe this will be a risk for Gannett’s bottom line. Will enough people pick up online subscriptions to make up for lost page views? For myself, the day I can no longer read the Louisville Courier-Journal’s [paltry] Indiana section is the day I go instead to TV websites for news from my homeland. Gannett’s real problem is that they’ve tried for too long to remain a newspaper company and have slashed costs instead of investing in 21st century reporting. What if, instead of laying off staff, they added people to generate more unique online content? What if people could go to their local newspaper website during severe weather for uninterrupted streaming coverage instead of waiting for a TV station to break in?

After years of falling subscription rates and stock prices (down over 75% in the last five years), Gannett finally seems to be embracing the modern world. But unless they can create the impression that the paywall-protected content is better than what they used to offer for free, the move may be too late. The Journal and Courier is preparing to add four staff members focused on digital content. Hopefully, this will allow them to create that value-add before too many potential subscribers give up.

2 thoughts on “Gannett paywalls: suicide or savior?

  1. My wife uses advertisements, coupons, and special deals—not all from the J&C but that’s the only source we pay for—to save ~$4000/year. She claims tree-paper is more convenient than e-paper for this and won’t change to e-coupons unless they can be printed multiple coupons per page and there expiration dates are lengthened to be comparable to tree-coupons. It took me years to get her to try email and online bill paying, now she’ll never go back. If the J&C could somehow integrate local coupons with smart phones (and publicize it so people hear of it) that might help people convert over.

    For us, adding people to produce more online content probably won’t make it more likely to want to get the J&C. For severe weather, I find the emergercy sirens, Weather Channel and my employers web page (do we work today?) sufficient.

    (We get the J&C seven days a week. My wife reads it and does the crossword puzzle on the day received usually. I have her save them for me and every few months will read the entire pile—that goes fast because for many things I already have heard what happened via local TV news (e.g, State Fair stage collapse), Purdue University’s _The Exponent_ (Area Plan Commission voted no on Northwestern Ave development proposal), or Post Office considering discontinuing Saturday Delivery (MSNBC TV), or paying attention while walking (Borders Bookstore closed).)

  2. Mark, you make some excellent points. I certainly don’t represent the entirety of the newspaper demographic. Actually, I’d suggest that I represent only a minority of newspaper subscribers — which is part of their problem.

    As for coupons, the new digital versions are exact replicas of the print version, including some of the coupons (but not all of the ad/coupon inserts). With sufficient feedback, that could probably be included.

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