Nick Carr: Who will pay for the news?

The newspaper industry is going to be severely disrupted, but that doesn't mean all news will be free. Will a lower supply of news translate into a greater ability to monetize it?

As someone who dearly loves reading The Wall Street Journal every day, it was gratifying to see Nick Carr blast a hole in the "everything will be free" utopian arguments from Clay Shirky and others that suggest newspapers are dead.

While the newspaper industry is certainly reeling, Carr's suggestion that a lower supply of news will translate into a greater ability to monetize it rings true:

Shirky claims we're "in a media environment with low barriers to entry for competition." But that's an illusion born of the current supply-demand imbalance.

The capital requirements for an online news operation are certainly lower than for a print one, but the labor costs remain high...It's a fantasy to believe that the production of all the kinds of news that people value, particularly hard news, can be shifted over to amateurs or journeymen working for peanuts or some newfangled journo-syndicalist communes...Whatever the Internet dreamers might tell you, [newspapers] ain't going to a purely social production model...Once you radically reduce supply in the industry, the demand picture changes radically as well. Ad inventory goes down, and ad rates go up.

And things that seem unthinkable now--online subscription fees--suddenly become feasible. We also, at that point, get disabused of the fantasy that there's no such thing as news consumers. We see that providing fodder for "conversations" is not the primary value of the news; it's an important value, but it's a secondary value.

Amen. I do believe that how newspapers structure their operations, including how they charge for their services, will change, but it seems like a gullible fantasy to believe that the Web will magically create quality content via a ready pool of amateurs.

I'm one of those amateurs. I think I'm capable of writing great commentary, but I'm not the one out there doing real journalism. That's what CNET and other news organizations create.

I'm confident that the Web will reset the way in which media gets created and consumed. It already has. But the idea that content will get created in the absence of effective payment models for that content is absurd. While the creative destruction of the newspaper industry continues apace, let's be sure to focus on the "creative" and not revel in the "destruction."


Follow me on Twitter at mjasay.

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About the author

    Matt Asay is chief operating officer at Canonical, the company behind the Ubuntu Linux operating system. Prior to Canonical, Matt was general manager of the Americas division and vice president of business development at Alfresco, an open-source applications company. Matt brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. He is a member of the CNET Blog Network and is not an employee of CNET. You can follow Matt on Twitter @mjasay.

     

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