Can News Sell Online?

The popularity of logging on to read the news is growing, but with the advertising downturn squeezing revenues the pressure on publishers to turn their online investment into hard cash is growing. Derek Jones, managing director of MediaTel Group, asks: Can news sell online?

The question should be passé by now: that it’s not is only because so few appear to have found an answer. There must be a whirlwind of strategic reviews blowing around major publishers at the moment as they try to turn “serious brand” and major online investment into serious revenues. And nowhere is it more pressing and more competitive than amongst the UK’s national newspapers, and our own trade publishers (to a lesser degree).

Now, I have to admit that I’m writing this based on hearsay, hunch, and, well news stories, so if anyone wants to tell me I’ve got it all wrong then it would make a better article than this. Given I haven’t seen that anywhere yet, I’m sticking with this line.

What do newspapers, and weekly trade magazines for that matter, do best? News, features and jobs. So what do they do online? – Yep – news, features (often fewer) and jobs. So the jobs bring in extra revenues, the news (as long as its broken online and not bizarrely ‘saved’ for print) brings in readers and the features become scarce. And what’s most important in this mix – probably news. But is that the right focus?

Give it all away online (apart from The Times crossword oddly) or use it to drive magazine subscription sales (many of our own trade titles) and top up the revenues from banner ads, sponsors and those jobs. A simple model, but requiring significant resource and a tough one in tough times when all those revenues may be in decline.

So what’s missing? Well maybe its too simplistic, but perhaps a little nous.

What drives subscription revenues online and has done years before the net came along? Aggregated intelligence (sometimes a fancy name for masses of news stories); unique information; in-depth analysis.

If you look around there’s the Reed Elsevier empire, which does all of these things; Dialog; FT Profile (Pearson a clear exception in my analysis); and even minnows like our own products at MediaTel and AMMO, which is quite widely used.

All of these do little that is fancy – gather, collate, analyse and distribute in a timely and targeted fashion. But the targets are niche markets not mass markets – crucial point as all the “serious brands” can offer mass market distribution to advertisers, which maybe obscures the fact that niche can be more profitable online ultimately.

So why can’t more traditional publishers make money from their content (or maybe even from some of the information they have that never makes it into print or HTML). I would suggest that just maybe they can’t see the wood for the news.

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