By now, there’s a very good chance that most of my readers are quite bored
with my explanations of why it’s a Really Good Idea for WSJ.com to go free.
But when I read Marek
Fuchs yesterday, I couldn’t just let his final question go unanswered. So
instead I turned to someone with a much greater knowledge of the (new) media
business than I have: Chris Anderson, the editor of Wired, and author of an
book called "Free".
Here’s Marek’s question:
By about 10 to one, the articles I’ve seen have not examined this central
point: When you charge $500 or so for your product under one form of distribution
and give it away free as air on the other … how many people eventually switch?
The question is tantamount to the survival of these companies, since, any
way you slice it or cross your fingers, newspaper readers are worth so much
more (to advertisers) than online readers. Has anyone ever prospered by giving
away the same product they were selling for a lot of money at another place?
I can’t conjure one up … but since the business media failed, maybe you
can educate me.
And here’s Chris’s answer:
Marek asks a good question: "Has anyone ever prospered by giving away
the same product they were selling for a lot of money at another place?"
Although I’m sure someone has, somewhere, his point is generally well taken.
But he’s phrased the question wrong. Nobody that I can think of wants to give
away in one domain what they sell in another. They want to give away something
different.
For example, we at Wired give away what’s basically a stripped-down version
of the magazine online. We also sell a premium version–an immersive, integrated
package of photography, long-form journalism and design, all delivered on
a high-resolution medium with infinite battery life and equal indoor/outdoor
readability (we call it "glossy paper").
The online version incorporates multimedia, user comments and other contribution,
and links elsewhere. The print version, on the other hand, is a visual feast
and the only good way to read our longer stories, which don’t translate well
online at all.
In short, the two products are not the same. The free one is optimized for
a medium with near-zero marginal costs. The non-free one is optimized for
an immersive visual medium that computer technology still can’t touch.
The problem with daily newspapers is that paper doesn’t add much value to
short-form, non-visual news. Indeed, I think of it as a "value subtract"
medium–you get the same news as online, just 18 hours later and with smudges
on your fingers. Shifting the audience to a free online version is not such
a radical step–after all, most broadcast is "free to air" because
the marginal cost of reaching each additional audience member is zero, and
it’s often said that if you can understand why they sell newspapers on the
street in boxes that don’t limit how many copies you take, you’ll really understand
the newspaper business. They’re not selling papers, they’re selling audiences
to advertisers. Online does that just as well.
Anyway, they don’t have a choice. The web is a conversational medium, and
if you’re behind a subscriber wall you’re not in the conversation.
I basically agree with Chris here, except I see more value in newsprint than
he does. I probably consume more news online than 99% of the population; I subscribe
to 348 RSS feeds just for starters. Yet I also subscribe, with my own money,
to the print version of the WSJ.
Every morning I leaf through the dead-tree version of the WSJ while drinking
my coffee, and I get valuable information that way which I wouldn’t get around
to reading once I sit down at my computer, check my emails, and jump in to all
the different demands of the workday.
The print version of the WSJ is a commuter medium, a morning ritual. People
read it on their way in to the office, even if their office is only a few feet
from their kitchen counter. Once the day is up and running, no one ever finds
the time to sit down and read the paper. For that reason, the paper can’t really
be replaced by anything online, since almost by definition once you get online
you’re in that "up and running" state.
In any case, I’d like to take this opportunity to ask my readers a question.
Often, here, I link to WSJ articles. Is this an annoying habit which should
cease, as much as practicable, because those articles are behind a subscriber
firewall? Or do most of you have access to them?