Big Media Can't Paywall The Public Interest


The essence of journalism has always been to pursue truth and the public’s right to know. Given the fundamental shift that paywalls spell for media it’s worth asking whether, by locking down the news and denying open access to the public, paywalls are anti-journalism.

Buoyed by the success of the New York Times, hailed as the leader in digital subscription strategies, the commercial print media appears to have categorically decided in favor of paywalls.

In Australia, where the media is still playing out its most tumultuous year in history, the introduction of metered access at Fairfax yesterday marked the advent of paywalls, bringing it in line with similar initiatives at News Limited (recently rebranded to News Corp Australia).

Good journalism costs money. This is a fact, but paywalls are not fundamentally about creating revenue to support good journalism. It’s easy to forget that the form (news pages with ads for sale) and function (to get the news to the people) of media were never aligned.

Newspapers existed to sell advertising. Journalism was a by-product. This was a much easier fact to deny when money was flowing, because, quite frankly, it never needed discussing. But as print advertising has dried up and been drip-fed online, the uneasy relationship between what the media is and what the media does has been harder to deny.

So where does this lead paywalls in valuing journalism as opposed to adding value to news organisations? The implications are not as obvious or simple as media moguls would have us believe.

Paywalls suggest that revenues from advertising are not sufficient enough to keep news companies running as we’ve known them. But there is an important, and often overlooked distinction between news companies and journalism. News organisations need journalism, not the other way round. One does not necessarily lead to the other.

First, it’s important we understand the decision to put up paywalls as a purely an economic one, as New York Times CEO Mark Thompson told Harvard graduates recently:

“[T]he launch of the pay model is the most important and most successful business decision made by the New York Times in many years. We have around 700,000 paid digital subscribers across the company’s products so far and a new nine-figure revenue stream that is still growing.”

For now paywalls look the most likely way to breathe at least a few years into ailing media companies, but there is some evidence that profit margins are stabilising even for those who’ve made some success of them. Yes, even for the New York Times.

We’re told that content needs to be paid for, but in fact what has come to pass as the new norm, is not driven by the value of content (which is fundamental to the success of paywalls), but the value that large news organisations represent to their shareholders. It is of course a fallacy that we have always paid for content through the cover price of a newspaper, which in reality only helped cover the cost of distribution. Hindered by high overheads and the complexity of their structures, large news organisations (and we’re talking about mastheads here) remain labor-intensive empires with habits of a media past.

Clay Shirky best illustrates this in his 2010  post "The Collapse of Complex Business Models":

“To pick a couple of examples more or less at random, last year Barry Diller of IAC said, of content available on the web, "It is not free, and is not going to be," Steve Brill of Journalism Online said that users "just need to get back into the habit of doing so [paying for content]online", and Rupert Murdoch of News Corp said "Web users will have to pay for what they watch and use."

Diller, Brill, and Murdoch seem be stating a simple fact, that we will have to pay them, but this fact is not in fact, a fact. It is a choice, one its proponents often decline to spell out in full, because, spelled out in full, it would read something like this:

"Web users will have to pay for what they watch and use, or else we will have to stop making content in the costly and complex way we have grown accustomed to making it. And we don't know how to do that…"

News has always been judged on value. It’s a concept that dictates what is and what isn’t the news of the day. Stories with a higher news value, determined by different criteria depending on the organisation, but almost always fundamentally tied to audience relevance, traditionally got a better run in a newspaper. Contributing to this value is the notion of public interest: is it in the publics’ interest to know this? It’s basic J-school stuff.

The notion of a paywall inverts this. The theory behind a paywall, touted by parties with a vested interest, is that people will pay for good investigative pieces that are in the interests of the general population. But if information is in the interests of the general population, how is putting it behind a paywall fulfulling the role of journalism? News value no longer becomes about the importance of a story, but the monetary value that news organisations can use to justify their paywalls.

The flaw in this logic is best displayed by news organisations themselves when, at times of major breaking stories, they drop their paywalls. If important stories are free, what value does that place on those that are not?

When discussing the virtues of paywalls in relation to journalism (which is my specific concern), the most obvious is that professional journalists, that is people making a living out of the practice of journalism, need to be paid, and in order to be paid there needs to be a sustainable business model. It is mostly conceived of a notion that larger commercial news organisations will continue to be the major employers of journalists going forward, but media companies as we know them are hard to envisage into the future.

As Michael Wolff recently put it:, "the most pronounced and successful trend in online news is not adding paywalls, but providing more news with significantly fewer people".

One could argue, and many have, that paywalls only add to news organisations vulnerabilities. Revenues continue to drop and smaller independent media players (such as New Matilda and Crikey) have emerged. This is to say nothing for the ABC and now The Guardian (philanthropically supported) as viable alternatives to locked-down content.

The simple truth is, when it comes to generic news subscriptions, paywalls are about funding a very traditional way of doing things, that is supporting the economics of news companies. That we need to find a way to fund solid investigative reporting is not in dispute, but the reason we value those stories, because they are in the public interest, is at odds with locking that content behind a paywall.

We need to reframe paywalls as a journalist’s dilemma. It’s an illusion that the future of journalism is safe behind them.

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.