Murdoch Pay Model: All Talk?

by Glynnis MacNicol | 8:17 am, August 10th, 2009

» 1 comment

rupert_murdoch The New York Times David Carr is weighing in on Rupert Murdoch‘s announcement last week that he plans to start charging for every last bit of information his company puts on the Internet. Carr says that Rupe’s “shouting from the top of a pay wall is a bit of a head scratcher” and speculates that may be all it is — shouting.

Setting aside the execution risk of such a plan, it’s difficult to tell how serious Mr. Murdoch is, given his history of grand statements that were only that. Perhaps he was making an unsubtle effort to change the subject during a bleak earnings call for News Corporation: fourth-quarter operating income, adjusted for certain items, dropped more than 30 percent and after taking $680 million in charges, mainly from the unit that houses MySpace, the company reported a net loss of $203 million.

If that was Murdoch’s plan it certainly worked! (Perhaps it was the media equivalent to “get off my lawn!”) It also makes a whole lot more sense than Murdoch actually believing that financial success can be found in a blanket pay wall plan. That said, regardless of whether or not it all pans out, it’s hard not to conclude that our days as freeloading readers will be coming to a closer sooner than later.

David Carr, New York Post, New York Times, rupert murdoch

b.j.

A few questions:

1. How bad is this company at economies of scale and successfully integrating operations? There’s definitely value in having more than one voice covering a particular area, but is it possible it could use The WSJ to allow the Post to focus purely on New York City? I just wonder if, with such a sprawling operation, there isn’t more of a chance for specialization within each publication but then use the content from the other operations to allow for the appearance of more depth. By this, I mean, let the Post focus purely on New York, and use content from other sources about international and national news. I know the papers probably do this already to some extent, but is it enough?

2. To what extent does Murdoch think all of his papers are equally special? It makes sense to assume that The Times could charge, but is anything so special about the New York Post that it can charge? Perhaps it could turn into something like that, but right now, I don’t think it could. But then, why would it want to? Are its operations so expensive that it can’t exist by having a free site? You’d think that for a fairly regular site like the New York Post’s, he want it to stay free while others try to charge so it can pick up the traffic that could come its way. Carr nails this point very well, by the way.

3. Why do so many people act like it’s an either or proposition? Carr doesn’t, and not all do, but enough do that it’s almost as if a lot of people don’t realize a lot of these sites could use a “freemium” model of offering some content for free to keep up page views and locking other stuff behind a wall. If this works even slightly, and the papers use the money to make themselves more unique, it could be a very, very smart move, even if it isn’t permanent.