Newsday erects a pay wall. 35 people subscribe. Newspaper editors collectively shudder. Total cost of Newsday’s failed experiment? A cool four million dollars.
Will
Will writes from Washington, D.C. (well, Arlington, Virginia). You can reach him at willblogcorrespondence at gmail dot com.
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I think the key word here is “collective.” The newspapers need to do more than shudder in that fashion. I wonder if even the NYT is big enough to do this on its own.
The fact of the matter is, no single entity is, in and of itself, indespensible. Not to cast aspersions, but especially Newsday. If the NYT goes behind a paywall and nobody else does, people will simply go to the WSJ, or the Guardian, or anyone else doing national or international news.
The perverse thing here appears to be that there is also an incentive to be the last player NOT to go behind a paywall. If the Wall Street Journal and the NYT and the LA Times are all pay-for-play sites, suddenly the Washington Post is getting a ton of traffic at its free site.
In short: collude.Report
In short: collude.
Price fixing is illegal. I mean, I suppose if we were really a free country, the constitutional right to peaceably assemble would apply to corporations too, but that’s tomorrow’s decision not yesterday’s.Report
What we need is legislation to raise the penalties for cracking a pay site.
In return, the media could promise better spin for the legislators responsible for protecting them.
Everybody wins. Well, everybody who is important enough to count wins.Report
But price collusion is not the only kind of collusion. And even then, we do allow certain industries to collude in lots of ways. MLB, anyone?Report
There are other kinds of collusion beyond price collusion, but colluding to erect paywalls is pretty clearly price collusion.
And really, I can’t imagine anyone arguing that the government’s various interventions in MLB should serve as a template for the future.Report
I am not saying that it should offer a template, only that the government does, in fact, allow some forms of collusion. And I don’t see simultaneously erecting paywalls as a form of price collusion. Let’s say there are five gas stations. The fact that they all have a cash registers does not amount to price collusion. Price collusion is getting together and agreeing to a price.
Erecting paywalls is no different than any number of businesses agreeing to, you know, charge people for what they produce. Being against price collusion does not mean we have to agree that Dominoes and Papa Johns will give pizza away for free. We accept that they will all charge. They all come up with different amounts, and occasionally see what the other is charging and adjust accordingly.
How is it that the WSJ and the NYT simultaneously agreeing not to give their product away for free amounts to price collusion? One can imagine them charging different amounts. Does the fact that all beef jerky manufacturers charge for their product point to proce collusion on their part?Report
The point isn’t that they all charge. The point is that there’d have to be some strong incentives in place to punish defectors, because the amount of traffic a defector could generate as the only big news brand not behind a paywall would be massive. Those incentives would amount to collusion. The absence of incentives would mean the whole scheme would collapse, as it is now every time someone tries it.Report