The National Business Review's publisher said it was "moving into a new phase of electronic publishing". No, I'm not referring to Barry Colman's letter last week announcing the NBR' website's embarking on "The Great New Journalism Adventure" -- it is introducing paid-subscriber-only content -- but to the last time Barry declared a sea-change: 10 years ago when he announced that the NBR website was being closed down because it wasn't making enough money.
In 1999, Chris Barton wrote an excellent post-mortem of NBR's first foray on the Web , listing the errors of its conception, and noting nonetheless that even Colman admitted the site was actually making money:
"Even on the week it closed, the advertising more than covered the cost of the operation. On the day of the announcement, Saatchi rang to book a new campaign. It wasn't a financially driven decision at all - it was a strategic one based on whether we could ever sell information on the Net."
After two-and-half years Colman now knows he can't. "We were expecting at least 2000 subscribers by now - we've ended up with 200."
And now Barry's hot new thing is to … sell subscriptions.
In making the announcement, he railed against:
… a huge band of amateur, untrained, unqualified bloggers who have swarmed over the internet pouring out columns of unsubstantiated “facts” and hysterical opinion.
Most of these “citizen journalists” don’t have access to decision makers and are infamous for their biased and inaccurate reporting on almost any subject under the sun (while invariably criticising professional news coverage whose original material they depend on to base their diatribes).
And as if that weren't enough, the editorial page column by "The Scribbler" in last week's NBR lays into Twitter and, quite personally, into Bernard Hickey of interest.co.nz. Barry needs to careful lest people think he has a chip on his shoulder …
The responses have been swift and generally savaging. Lance Wiggs ventured with The NBR is in trouble – what should they do?. And Bernard Hickey himself has a post headed How to profitably publish financial news online for free, with which I largely agree.
Interest.co.nz is part of Trade Me's advertising network (meaning Trade Me sells ad impressions on interest.co.nz) and also, I think, still sells advertising direct. It is in the happy position of targeting readers who want information and analysis on finance and investment -- the same market a big chunk of the internet advertising dollar is also trying to reach. But advertising still isn't what makes it profitable. Says Bernard:
5. Donate the news and sell the data
This is at the core of how we make a profit. We collect an awful lot of data about interest rates, the housing market, the economy, financial markets and commodity prices. We display these in charts and tables for free and use them in free news and commentary on our website.
A major source of traffic to our site is to our rates comparison pages (mortgages, term deposits under one year, term deposits over one year, and credit cards) and that’s where many advertisers want to be for obvious reasons.
We then collect and store the data for these pages and sell that in various concentrated forms and formats to banks, regulators and other media. We mine these data sets constantly for story ideas and new ways to profit from them.
That's not only great work: it's the kind of work NBR half-pie got underway the first time it tried. The first version of nbr.co.nz was rich with data -- property, company, credit and vehicle registration databases..
It was bloody hard to find though, even after the site was redesigned. It was the classic Cold Fusion mess. Yet if NBR had worked on better ways of packaging and selling data online, it might created a whole new market for itself. It's not like Barry hasn't found mechanical, profitable ways to sell data in the past. And it wasn't like they didn't have time. The site was making money.
So what's NBR selling this time? Says Barry:
What we will be introducing will not make the mistake of providing journalism as usual and charging for it. We know that we will have to provide a consistently superior news service and I believe you will quickly see we are up to the challenge.
I expect about 20 per cent of our web news to be Subscriber Only Content. The exact ratio will vary as we will be using the category for only the best news stories, scoops and commentary pieces that we post on any one day. Besides the serious issues of the moment the content will include large doses of satire and goings on uncovered by our nosey Private Bin reporters.
One might debate the wisdom of making your "best" stories the very ones that no one can link to. But why also slap a price on the very genre in demonstrable oversupply on the internet -- commentary? Who is really going to pay to read last week's ruminations on climate change sceptic Chris de Freitas, when so much of the same is free online?
To be fair -- and Barry's critics seem to be missing this -- most of his subscriber content, from lead news stories to most of the columns weren't online anyway (only The Listener more diligently protects its opinion-formers from the dangers of conversation). So he seems so far to largely be selling stuff that wasn't previously for sale in web format.
And yet, while Bernard is brilliant at what he does -- he's smart, prolific, quotable and agile, and he loves the data -- the news is not all made of that. The reporter who spends a month (or even a week) nailing an important story doesn't fit the pulsing, real-time environment of blog-cultured online news. I don't think it's a coincidence that the model Bernard lauds looks exactly like his own. It works for him.
But even here, the difference isn't what readers pay to get that reporting in print form -- that money is largely eaten up by production and distribution -- but in what advertisers will pay to be on a print page rather than in the banner at the top of a web page, and in the massive oversupply of advertising inventory in a world where anyone may publish.
Advertising is supposed to be supporting a brave new world of news, views, sound and vision. But there simply isn't enough money around to make everyone's dreams come true. Music rights holders complain they're not getting enough from YouTube, but it's not like YouTube isn't costing Google half a billion dollars a year to run.
I suspect that hardware may come to the publishers' rescue, by which I mean that a really good post-Kindle mobile information product could work. Mobile communications services have always been able to sell the contents of their walled gardens, but the experience has largely sucked.
Maybe what my iPhone does changes that a bit. I use my traffic camera app and my Twitter app. And guess what? I paid for all of them, once. I paid for the applications to get the content. And it was cheap. That seems to have worked for all concerned.
In his recent smoochfest of an interview with Fox News from the Allen and Company media conference in Sun Valley, Rupert Murdoch confirmed his plans to "lead the newspaper industry into monetising what it has", and confirms that he's in conversation with hardware makers and "we're all working on wireless readers for newspapers, or for books and magazines".
You may now be thinking that if Murdoch could manipulate his digital pages with the same ease with which Amazon can delete 1984 from your kindle, that's a bit scary.
But there is no avoiding the fact that this is a networked world, that a big news story with popular currency will always beat a big news story behind a paywall. There will be places where openness gives way to utility (hey, I'm a Mac user, I did that), but I can't see Murdoch or Colman's adventures in monetisation turning out quite as planned.
NB This is all a very long way of saying that we'll be featuring both Bernard Hickey (at his place of work) and Barry Colman (in the studio) on Media7 this week. It should be lively. This is the first show to be recorded in Studio 3 at TVNZ, rather than at The Classic. Not our choice, but a good new challenge. Our audience space is somewhat constrained, so we'll have to be a bit less relaxed about people just strolling in. On the upside, we will still be serving drinks. If you'd like to join us from 5pm on Wednesday, hit the Reply button and let me know.