Tuesday, July 13, 2010

WJEC 2010 - Journalism Business at Crossroads

By David Moepeng, PDMM student


The business of journalism has been under threat since the advent of internet-supported digital media which gives audiences free access to content. This has resulted in loss of potential revenue for the news media, especially print publishers who are now scouting all over in search of business models through which they can retain audiences, continue to generate revenue and thereby protect the business of journalism from becoming unfeasible.

While digital technology is hailed as a major leap forward for the traditional news media, it has proved to be suicidal and unsustainable for most publishers due to the little revenue that online publications can generate.

As online technology continues to tear apart traditional business models for news media, there is a greater need for viable revenue generating models in digital platforms such as online and mobile.

It remains unclear as to what models the news media will adopt; although, currently, the introduction of access charges for online content seems to be the most favoured.

Speaking in an interview on the sidelines of the recently-ended Highway Africa 2010 conference and the 2nd World Journalism Educators Congress in Grahamstown, South Africa, Joe Foote, Dean of the Gaylord College of Journalism and Mass Communication at the University of Oklahoma, US, advised the news media to be experimental with multiple models.

Foote said the media industry is currently unclear about what business models to adopt as no one knows exactly what will work.

“Whatever business models are adopted, they will be a risk to anyone who tries them so perhaps a couple of years from now we will have had winners and losers and we will know more,” he said.

Foote observed that the simplest model is one that involves paywalls for subscription-based access to news sites, adding that multiple models would need to be applied simultaneously to generate revenue from multiple sources, including through news aggregators such as Yahoo and Google.

He advised that news organisations will have to be more innovative to attract advertisers and consider more reader-tailored advertising. Foote said despite being used by online advertisers already, this model is yet to be adopted by the news media.

Adam Clayton Powell III, vice provost for globalization at University of California believes that mobile applications such as Apple Iphone news applications will also provide a revenue stream for the news media in the future, although currently the pricing for such gadgets and applications limits access.

Powell III also sees the emergence of non-advertising supported news media organisations which will be funded by entities such as non-governmental organizations, governments and other interest groups.

Whatever business model works will, however, depend on the type of publication and the quality and exclusivity of its content.

The internet could therefore become a measurement tool for demand as publications that carry content that is readily available in free platforms may lose readers and go out of business if they introduced pay walls.

Foote gave an example of financial publications in the US such as The Economist, Financial Times, Wall Street Journal and Bloomberg News, which he says are making significant profits.

He also sees small town newspapers surviving the tide due to little competition, but added that this will also depend on quality and relevance of the content.

Click here to listen to a podcast in which Joe Foote spells out his "Tips for New Business Models in the Digital Age":

video

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