TL;DR : No….and Yes.
Since the time i started working to solve the issues plaguing the ever important News Media industry, i have been planning to write a blog on the same. Today, Harsha Bhogle put out a tweet asking the above question and that acted as the catalyst.
I don’t know if i know more than him, but here are my learnings from a year of trying to fix the broken business model of the News Media Industry.
Let me know what you think in the comments, i’d love to start conversations!
People, including myself, have been attributing the TV News Media rapidly losing their integrity to their broken, advertisement based, business model. Although that does play a role, solving that shall not eliminate the issue. I say this because there are other channels which host sensible debates and broadcast uncolored information to citizens along with Advertisements. This is a complex issue with many angles and aspects to it. There cannot be one silver bullet, but every bronze bullet is welcome.
Advertisements are not evil, they are just difficult to sustain a business on, especially the business of journalism which has massive overheads. This does lead to alot of issues like
1. An unending race to get more eyeballs,
2. The unattractive ratio of ads to insights,
3. An unsustainable dependence on a revenue source which changes its favourite medium every decade (print to radio to tv to online to who knows what next)
and yes, reduction in quality.
Reduction in the quality of content is however, an indirect result of basing your business model on advertisements. In a time where advertisers prefer Online ads over TV and other mediums, any advertisement based business in these mediums, shall experience a revenue drop, which leads these businesses to reduce costs, which might lead to reduction in quality of content/product. However, that’s not a necessity, businesses can reduce the overheads and still continue to produce unbiased and civilised journalism.
The channels/brands that choose to air ‘Shouting Matches’ aren’t doing it just to get more advertisements but with other ulterior motives, they are acting as loudspeakers of an individual or party’s ideologies because they believe in their mission or their bank accounts.
They sensationalise news not ONLY to cash in on our human behaviour that loves drama but also to gain more eyeballs and thus more advertisers, which is just an added bonus to spreading the selected ideology more effectively.
So, if people start paying for quality content, will these loudspeakers go mute?
Well, No, they are not short of money and they aren’t doing it to get more advertisers. They CHOOSE to spread that ideology to fulfil a mission.
There is however a silver lining to people paying for content.
Firstly, let me clarify that people shall pay for Quality Content ONLINE, Television is a different ball game altogether. There is no infrastructure or medium for people to pay for quality content on TV. DTH Set Top boxes are mandated by the government and although people can choose the channels they want, they end up selecting all as a bundle because most News channels are FREE. On TATA SKY excepting 4 news channels (NDTV 24X7, TIMES NOW, TIMESNOW HD and CNN News 1) all other news channels are priced at <₹3 a Month , Hindi News Channels are <₹2 a month. 90% of all news channles offered are FREE. Even the above mentioned 4 are priced at just<₹6 a month.
So when people say that we should pay for quality content, they usually mean we should pay for Quality content ONLINE. Paying for content online shall not make a difference in the integrity of content on a completely different medium (TV). At least, not in the short term.
Then why should i pay for Content?
Paying for content can lead to kickstarting of a change in the mindset of consumers and the creators. Paying for any product does 2 things:
1. It adds value to the product.
2. It ensures value addition in the life of the user
And in journalism’s case there shall be a third benefit, ‘Merging of the Consumer & Customer’
Let me explain all 3.
- Paying for a product adds value to the product.
Something that Mr. Piyush Kankaria, Co-Founder, The Yellow Straw once shared with me, stuck as a life learing,
Never give your product out for free, it makes people feel its not valuable, charge a Rupee for all that matter, but always charge!
This is something that the news media industry has completely been ignoring under the pretence of making their product reach a larger mass and deepest corner of the country. When the business was being subsidised by advertisements, it was a logical plan to provide content/service for free (Facebook, Google do the same) but the media companies at the same time were creating a mindset of their product actually being a freely available commodity and therefore completely eroded any chance of viewers paying for news, an option, in hindsight, they should’ve kept alive and infact should’ve used earlier, to secure their businesses (Something that Facebook & Google are doing by diversifying and creating other revenue streams). If people paid for content, they would value it and would have a completely different mindset towards it.
2. Paying for a product ensures it adds value in the user’s life.
If people paid for the product, they would hold the producer accountable. They would treat it as a purchase decision and as a choose the one producer(s) they want to be associated with. This makes sure that there is healthy competition among publishers to better their product (in our case, CONTENT) and not just fight for more eyeballs. This competition shall make sure that the content adds value in the life of the audience, else the user shall stop paying and the producer shall lose a customer. Paying for a product shall keep the producer on their toes and protect the integrity of the content they distribute.
3. Paying for ‘Quality Content’ shall merge the customer & consumer.
This is a special case in a few industries, including News Media. The broken advertisement based model for News Media has led to the fission of the customer (one who pays for the product) and the consumer (one who uses the product). In today’s scenario, the advertisers are the customers and the viewers are the consumers. As advertisers are the customers, the business of news media runs to serve them, they discuss how can they get more advertisers and ad money in their sales meetings and not how they can get more viewers. If viewers or readers start paying for quality content, the customers and consumers will fuse and then the business goal shall come back to providing the best content and in turn getting more PAYING users.
These points and the business opportunity makes sense, but would this be the case in a country like India? Again, No…and Yes.
Yes the results would still be the same if people start paying but in a country where:
1. Per capita income is about $2,100 as compared to EU ($34,000), UK ($32,000), US ($64,000);
2. Privacy concerns are non-existent; and
3. English penetration is abysmal (Why English? Because most of the quality content and the internet is in English)
It is difficult to say that the masses would pay for quality content. If the situation stays the same, we are looking at maybe a replica of the Online Gaming industry where a small percentage of the users are paying users who spend enough to cover the costs of all free users.
However, with internet penetration increasing rapidly and India recognising that it needs innovating products and content in its Native Tongues, there is a silver lining. Companies like Newslaundry, The Ken and EXTRA! INSIGHTS (Disclosure: The author is the FOudner & CEO of EXTRA! INSIGHTS) are working to build products that can achieve the common goal of leading to a mindset change in people and to make them understand that quality is tied to a price and if something’s not worth your money, its not worth your time!
About the author: Anuj Agarwal is the Founder and CEO of EXTRA! INSIGHTS, A new age journalism aggregator & curator that curates credible and in-depth journalism from the most reputable publishers across the world under one subscription.