FT Digital Media & Broadcasting Conference: Book publishers show newspapers the way
In a morning where book publishers seemed to be getting on with it, whilst newspapers and web companies are still trying to work it out, it was a presentation by John Makinson, CEO of Penguin Group, that delegates at the FT Digital Media & Broadcasting Conference were discussing over lunch.
Makinson showed how his Penguin and Dorling Kindersley brands accepted there will be significant switching from print to e-readers, and were ready to embrace it, with clever and innovative interactivity. The new world would mean less revenue per title for the publisher but a greater share of that revenue than in the retail market; and Makinson celebrated the chance to try different models and to analyse customer data in detail as a result.
The demonstrations appeared to take us away from books into entertainment – video, applications, innovations become part of the “book” online; and a world where Makinson saw Kindle, Sony and Apple all competing – with no dominant Google!
Conversely the newspaper world is still unsure of which models to test. On the platform were the FT and the New York Times – both ahead of the pack; neither adopting any luddite tendencies, but both moving rather slowly it seemed. Looking at the planned and active models to date:
Arthur Sulzberger Jr, chairman and publisher, New York Times said –
NYT has announced a metered model, but this wont start until 2011. This means a set number of free articles then you pay, which keeps traffic relatively high. Newspaper print subscribers, meanwhile, will get everything online for free.
A paid-for app on Apple’s iPad device will probably also go live from 2011. However, the NYT is not investigating micro-payments currently.
The average NYT reader looks at the paper for 45 minutes per day in print and 45 minutes per month online, so the focus is on the loyal reader.
NYT has just appointed a social media editor in a bid to integrate social media into the paper.
He also said that “Denouncing Google is like denouncing oxygen”.
John Ridding, CEO of the Financial Times added –
The FT is using a frequency model now and will be adding micro-payments soon – a trial with Paypal, which will work by story, or on a daily or weekly basis.
“Micro-payments can support a subscription model,” he said. The FT is keen that as many publishers as possible start charging.
Ridding is open-minded to the idea of one central subs site BUT says it is essential to retain pricing power and the direct relationship with reader.
He said the reader data offsets some of the digital “challenges”. “Triggered upsells” using this data are 1/100th the cost of direct mail, according to Ridding.
In terms of payment systems, Ridding believes they must be easy, especially around micro-payments.
The FT’s current aim is no more than holding the online CPM level, not increasing it.
Finally, “The newspaper industry should be more confident”, Ridding said.
Matt Britten, MD of Google UK, was alongside the newspaper bosses, but aside from suggesting they should “leap and learn”, he was unable to add to this particular debate, and was hardly challenged by the chair or either publisher.
He stated that Google was “working with many publishers”, and he suggested that Google’s “first click free” policy empowered publishers to experiment more.