"For more than a century, magazines and newspapers were what’s known as a “two-sided market”: We sold subscriptions to you, our readers, and once you’d subscribed, we sold your eyeballs to our advertisers. That was necessary because, unbeknownst to you, your subscription dollars often didn’t even cover the cost of printing and delivering the physical pieces of paper. They rarely covered much, if any, of the cost of actually reporting and writing the stories printed on those pages. And you’d probably be astonished at how expensive it is to report a single, relatively simple story.
But that was okay, because we controlled a valuable pipeline to reader eyeballs — a pipeline advertisers wanted to fill with information about their products. You guys got your journalism on the cheap, and advertisers got the opportunity to tell you about the fantastic incentive package available to qualified buyers on the brand-new 1985 Chevy Impala.
Then the Internet came along, and suddenly, we didn’t own the only pipeline anymore. Anyone can throw up a Web page. And over the past 20 years, anyone did — far more than could support actual advertiser demand.""Free on the Internet" isn't a viable business model for corporate-level content creators. And as Ms. McArdle notes, the presence of so many online "pipelines" has diluted the market for advertising space.
This means that readers will increasingly be asked to pay for any content that isn't a personal blog, or some variety of "infomercial".
But will this work? There are issues of perceived value to consider. I still have some copies of paper magazines that I purchased in 1997. Once you buy a print copy of something, it is yours forever.
When you purchase an online subscription, on the other hand, you're purchasing access. And that access can be revoked at any time. There is less perceived value.
Let me give you a concrete example: In the mid-1990s, I was an avid reader of Mangajin, a monthly magazine for enthusiasts of the Japanese language.
Mangajin published its last edition in December 1997, as the Japanese language learning boom of the 1990s was coming to an end.
But I still have all of those old issues of Mangajin that I purchased from 1995 through 1997!
Had I purchased mere access to digital content on a server, I would now have...
So the question is: Will readers, who have spent the last 20 years reading news online for free, suddenly be willing to pay for it?
And if not, what then? Might we see the day when magazines and newspapers abandon the Internet en masse, and go back to focusing on paper-based delivery systems?
Impossible, you say? Nothing is impossible. There is no iron law which says that the Internet must be the primary publishing platform of all these publications.
If no economically viable business is found for online publishing, the future of newspaper and magazine publishing may come to resemble the past.