Micropayments are not the answer
This is my first post to this blog, so allow me to preface it with a brief introduction. My name is Jay Balagna, I’m a 19-year-old freshman studying journalism at the University of Nevada, Reno. I’m also the Assisstant News Editor for The Nevada Sagebrush. I’m originally from Denver, Colo. but I grew up in Winnemucca, Nev. But that’s enough of that. Lately, Mike Higdon has dominated this blog with arguments for the idea of charging micropayments for online news content (like iTunes for news).
While I like that an idea to save the industry I hope to enter is finally gaining speed, I fundamentally disagree with it. Don’t get me wrong, journalism needs to be fixed, it’s very broken and I am a firm believer that the status quo is NEVER the best option. That being said, I feel that journalism is a public service, and forcing people to pay for the news they consume does a grave disservice to the public sphere.
“What are you talking about, stupid kid?” some of you may be asking. “We’ve always paid for news. 75 cents a paper. $1.50 on Sundays!”
Now now, don’t fall off your wheelchair, gramps. You were never paying for the news, you were paying for a pile of cheap paper and bad ink. The coupons advertising your buy-one-get-one-free laxatives paid for the news. Since the advent of the Internet, people have been given the option of skipping the paper fee, making news not only more accessible, but arguably more convenient.
I know nobody’s arguing the advantages of the Internet here, I just have to preface things a little. Ok, so picture a scenario with me. We have Joe. Joe is a poor college kid in Topeka, Kansas. Now, despite Topeka’s status as a bustling international port city, it’s a little hard for Joe to get international and national news. The national news he does get is often from either the local paper, which only takes Kansas-related stories off the AP wire or from The New York Times, the only other paper in town. I’m discounting TV news because it sucks. Anyway, Joe hardly has comprehensive information due to the lack of sources. Even then, we established he is poor, so he probably can’t afford to buy The New York Times with his Venti latte at Starbucks every morning.
But then the Internet comes to town.
Suddenly, Joe has access to a thousand different newspapers absolutely free. Joe can make informed decisions about life. Joe can be a responsible citizen, not only of Topeka (as I’m sure he was before the Internet man rolled into town), but of all of Kansas, the United States and most importantly the world.
This world citizenship is, in my opinion, the most important thing the rise of the Internet has brought humanity. The free flow of information has expedited the understanding, free trade and border less interactions that are requirements of a true global economy. Like it or not, globalization is being fueled by cheap infrastructure (fiber optic cables everywhere) and the free flow of information. If you doubt me here, read Thomas Friedman’s The World is Flat.
The effects of the free flow of information are much more valuable than the information itself. Basic economics teaches us that price rises, even the most minute, cause a drop in consumption. Making free information cost even a few cents has the potential to reduce its consumption by millions on a global scale. The resulting drop in education on current events and world issues sets the formation of the peaceful, productive global community back years. The poorest lose all access to the news that technology may gain for them in the future. The Joes of the world are robbed of the opportunity to become world citizens. Politics and issues that affect the entire global population remain localized.
That being said, the same basic economics lesson teaches that low priced goods have high price elasticity, meaning price changes have little effect on consumption. However, any rise from free is a big one. For example, eEditions of the Reno Gazette-Journal are only 25 cents cheaper on weekdays than printed editions and the same price on Sundays. Readers have absolutely no incentive to pay for the stories in the eEdition of the paper when on the same website that content is available for free. If the RGJ shut down its main site and made people pay for the eEditon of their newspaper, people would simply leave the site for another that offered free content.
In a city like Reno, if the RGJ, and to a lesser note the Sparks Daily Tribune, start charging for content, the only reliable sources of local news of any real depth are gone. While people like Joe can go to other sites to get national news for free, he suddenly lacks the only news he started with. This creates an all-new set of problems.
Prof. Donica Mensing mentioned to me earlier, after reading the first draft of this piece, the possibility that news organizations could charge for premium content and give basic content away for free. She used the metaphor of water access: tap water is provided free to all citizens, yet those able can pay extra for bottled water or filters. While this idea could easily be applied to content on a news site, I don’t think it should. Such a system would create a hierarchy of knowledge among the public. Those able to pay for better content would theoretically be better informed while those that couldn’t pay would be less informed. This creates the same problem I have already discussed, only to a lesser degree.
We as journalists have a public duty to educate the public on what is happening around them. A free press is essential to survival of democracy, but just as important is access to that free press. A solution needs to be found to save the journalism industry, but I cannot morally support any solution that denies access to even the smallest of minorities. Our goal as public servants should be to educate as many people as possible, not just those who can afford to pay.
I believe in what I’m doing, but am not naive enough to think I or anyone else can deserve to do it for free. The idea of micropayments for news content fundamentally compromises what I view as the very core idea of our profession. The business model of the news industry is broken, but this is not the way to fix it.
This is an important point. I hadn’t thought of it from the poor vs. affluent perspective.
However, it should be noted that the poor are often uneducated and uninterested in the news. That is obviously a broad sweeping generalization but I think it’s important to note demographically.
Also, the prices we charge for news would be fairly low. Many of the people you speak of pay for car insurance, cell phones (see my post after yours) and other luxury items. An extra $5 a week worth of news (on a simple payment plan that’s 5 stories or more not including free national/breaking content) is not that much to ask in comparison to the other public goods people buy.
Your most important point (they are all important) to me is the global citizen. If micropayments are a software, it must be able to stay integrated into the Internet so people will continue conversations and networking. Separating the news from everything else, I think definitely damages the global network and even the local networks as well as the information (by making it unappealing).
I think you’re arguments are fairly weak. You can make that same point for any number of things. You dismissed TV news because it sucks even thought an overwhelming majority of people get their news from TV. You’re theory that news should be a public good is not supported by any valid arguments. Journalists should strive to serve the public good, however, the finished product of that labor does not need to be free in order for the public to benefit, it simply needs to be known. People who want to know can spare some change. Also, you mentioned globalization and Thomas Friedman. What you fail to mention (or understand) is that Friedman is arguing that the world is flat because more people than ever around the globe can compete in a global economy. He is also arguing that it is a knowledge/information economy. Increasingly we are selling information and services, not manufactured goods. If everything on the internet should be free just so a lot of people look at it, the knowledge economy is not viable anymore. Those are just some of my random thoughts for now. Check the blog post below for another way to look at micropayments.
http://www.amirkurtovic.com/?p=71
“If you doubt me here, read Thomas Friedman’s The World is Flat.”
Garbage in, garbage out.
We’ve already subsidizing an information delivery agency which delivers a letter for about the cost of downloading a song from the iTunesMusicStore.
I imagine that they love to be able to handle subscription services via RSS and, when you’ve paid, give access to the content files at a news agency (calling them newspaper is just an anachronism)
The files can be .pdf, audio, video or zip’ed joint files.
The information in the RSS feed can be Google-able (so write the RSS description well,) while keeping the actual file within the news agency’s server.