The New Newspaper Business Model

With the sudden closure of Denver’s Rocky Mountain News Friday and the publication of its epitaph video, the past week has been filled with speculation on the future of newspapers. David Cohn, of Spot.us, a collaborative funding source for journalist assignments, is chronicling topical articles on his Google Reader shared items. Recommended.

In sum, the future existence of newpapers must always return to the revenue model. The most radical being proposed is paradoxically a return to the old model of paid content. Walter Isaacson proposed the return of walled subscription services on February 5 in Time Magazine, and newspaper publishing company Hearst and Cablevision, owner of Newsday both just announced walled content initiatives.

The fifth estate’s laments focus on the value of their trade as monetizable, i.e. news is worth paying for. The problem with their argument is “free” news will always exist – through newspapers and journalists that won’t wall their content, through CNN, and via the bloggers and Twitterers who will distribute the free content. What else could a Newsday or SF Chronicle, or your local paper, add to the news that someone will pay for? Think about that.

The return of walled subscription services will put journalist value in a “put up or shut up” position that could threaten their entire value proposition. Duncan Riley dares newspapers to wall in content:

Why? because it will drive their readers to other sites, including blogs, and that’s good for business if you’re in the web publishing business.

It might also once and for all prove that the blogosphere doesn’t need newspapers as a primary source of news

Turning back the clock to the old world business model in which “we, the media, own the content” makes little sense. There’s a hint of disintermediation frustration behind the media’s stance. We know many citizen journalists already write about ideas and topics they know much better (through their life experience) than the beat reporter, and it remains to be seen what really will be called “news” in the future.