Pay Walls, Old Media and Fair Wages

A while back David Simon, creator of the only two TV shows set in Baltimore ever, said that “the whole [newspaper] industry will continue to collapse until everyone swallows hard and goes behind a paywall.”

Why and how he’s hilariously wrong despite spending 13 years working at the Baltimore Sun nearly two decades ago has already been gone over better than I could so I’m not going to beat that dead horse.

(Ok, maybe just a little:  A newspaper’s subscription revenue doesn’t even pay for ink, paper and delivery costs.  The actual newsroom operation was ad supported before the Internet was a twinkle in Prodigy’s eye.  Newspapers don’t have to invent a new revenue model, we just need to get better at using the one the rest of the Internet stole from us in the first place.)

Instead I’m going to propose that there’s an actual reason newspapers are getting their lunch eaten by Internet startups:  Consistency of quality.  You can’t be a jack of all trades online like you have to be in print and that’s where very few newspapers have made progress.

First some economic background.  Everything has an intrinsic psychological value in addition to its monetary value.  The simplest example is sentimentality.  My grandpa’s cane is worthless in monetary value but priceless to me in psychological value.  In addition psychological value can vary based on usefulness; a barbecue bacon cheeseburger and garlic fries from Digger’s Diner is worth way more than its monetary value to me and way less to a vegan.

Of course one can affect the other.  My dad tells a story about a company that gave out free cans of soda in its lunchroom but got frustrated by finding half-empty soda cans all over the office.  All they had to do to stop the waste was to impose some token price, a dime or quarter.  Suddenly they’d given up something for that soda so, even though the actual cost was negligible, it had a psychological value above zero and they didn’t want to waste it.

Simon’s entire thesis is that the only way for something to have a psychological value is to impose a monetary value like the cans of soda but that’s clearly untrue.  Things can have no sentimental value and no monetary value but still hold psychological value.  Birthday parties hand out slices of cake just as freely as the office handed out cans of soda but how much unfinished cake have you ever seen thrown away?

And what’s the difference between a can of soda and a slice of cake?  Quality.

Daily newspapers have always had an imposed cost that kept customers coming back.  That subscription fee, the lack of competition and the relative hassle of canceling chained customers to the product.  Basically, they’d paid for it so they might as well read it, and when the bill comes they always read it so they might as well renew.  As long as there was the occasional gem and one or two beloved columnists that was enough to keep the ad revenue rolling in.  If someone subscribes for Gary Bogue they’re gonna get Sports and Business, and the ads within, whether they really read it or not.  If someone subscribes for the occasional investigative piece they get the editions without one as well.

Aside from that hook the quality had always been more or less irrelevant.  It had to be pretty good, granted, or else you’d never suck a subscriber into the cycle, but it didn’t have to be consistent through each edition or over time.

Then the Internet happened.  Now you can just read Gary’s column or his blog and leave and the organization gets only the ad revenue for the hook.  The best investigative project in the world could bring a million people to the site, but if the rest of the site isn’t exactly as good they’re not gonna stay.  You can’t just pour all your money into one section and pay bargain basement wages to everyone else and expect to coast to profitability anymore.

So, you may ask, how does that make David Simon wrong?  Doesn’t the soda story still hold?  Wouldn’t people keep coming back to the site if they paid $5/mo just to get the money’s worth?  No, because you wouldn’t pay $0.10 for a can of Coke when you could get a bottle of delicious grape Nehi for free.

Blogs – or really any news source born and raised online – grew up in that coldly Darwinian environment.  From their inception they’ve known that if every article, story or post didn’t live up to a minimum standard of quality or usefulness to their readers they wouldn’t last six months.  So they have no cookie-cutter weather stories or 12-inch briefs about City Council meetings where nothing happened, because then they’re paying for something nobody reads, and if nobody reads it you’re throwing money into the fire.  They don’t become a jack of all trades and master of none because every trade they practice but don’t master costs money and earns nothing.

So how do I propose newspapers fix it without resorting to cheap tricks that won’t work? It’s a two-step process:

Step 1: Focus on a limited number of things you can do very well and do them, which Digital First has the right idea about but is slow to actually go to practice.  Sports should cover local teams and preps, Features should cover local arts and entertainment, Metro should deeply cover things that matter to locals, a quality investigative team should fulfill their Constitutional role as watchdogs for the community.  Will that mean web site visitors go to ESPN for national sports and Politico for national news?  Yes.  But they do already and under my system, like all the limited-topic blogs, you’re not paying to produce content that doesn’t make any money.

Step 2: Pay your reporters well.  Right now BANG-EB pays its reporters somewhere around prevailing wage for a dump truck driver.  The reporters in the East Bay work hard and do their job exceptionally well, but there’s an undeniable subconscious link between wage and output.  Just like things one consumes have a psychological value, so too do things one produces.  If you’re worried about making your car payment or having to short sell your house it’s hard to work at peak efficiency, especially if you’re giving what your employer is paying for.

And that’s just for the people who stay.  If BANG-EB reporters were paid even close to median wage for a Bay Area worker with a college degree maybe Mike Taugher wouldn’t be with DFG.  Maybe Jonathan Morales wouldn’t be at SF State.  Maybe John Simerman wouldn’t be in New Orleans.  Maybe Hannah Dreier wouldn’t be with the AP.  They may have still left, sure, but more money would have improved BANG’s case for them to stay, and quality journalists are everything when every single story is important.

Of course it’s easier to take the David Simon route and just try to refasten the chain to your customer’s ankle.  Restructuring a newsroom to narrow their focus is a major shift in philosophy, treating every story like an A1 centerpiece is a major change in the old guard’s mindset, paying reporters grown-up wages worthy of highly skilled and highly trained professionals is expensive.

But if an organization’s management chooses to gamble on the Simon route – hope enough readers take the bait and enough hooks get set so they can keep paying good journalists less than they would a cement mason – they better understand just what’s on the table.  A talented journalist can write for Politico just as easy as easily as they can write for the Oakland Tribune.  Who’s going to hire the Captain of the Exxon Valdez?

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