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It should be noted that the internet is not overthrowing the newspaper business model. Newspapers have historically derived almost all of their revenue from ad

It should be noted that the internet is not overthrowing the newspaper business model. Newspapers have historically derived almost all of their revenue from advertising. Subscription prices didn't even cover all the costs of printing the physical paper, let alone the cost of producing the content. The problem, then, is that for whatever reason, advertising isn't as effective online as it is in print. I can't remember where I heard this from originally, but Matthee Yglesias makes similar remarks: http://yglesias.thinkprogress.org/archives/2009/02/what_to_do_with_the_newspaper.php http://yglesias.thinkprogress.org/archives/2009/02/what_to_d...

jyothi 18y ago
Absolutely to the point: Advertising isn't as effective online as it is in print. One possible reasoning is a web page is transient as opposed to a news paper ads, most of us involuntarily would have stared at the first page ad at least 2 times in a day. The conversion path has been made short and efficient online but a lot of branding aspect is taken away from these ads. Additionally one should also note that there is a small guaranteed price we all pay to read that daily newspaper. Which probably does ensure that journalism doesn't go completely bust in leaner times. Which is exactly what NYT is proposing and I agree with Matt Maroon's opinion completely.
erik 18y ago
"Advertising isn't as effective online as it is in print." Is the effectiveness of online advertising the problem? Or is it the relative price? I have the impression that advertising in print is vastly more expensive than advertising online. Does anyone have any insight as to why this is the case?
timr 18y ago
"Newspapers have historically derived almost all of their revenue from advertising" That's actually not true. As recently as the 1960s, big newspapers made nearly half of their revenue from subscriptions: http://onthemedia.org/transcripts/2009/02/06/03 http://onthemedia.org/transcripts/2009/02/06/03 As far as ad revenue goes, I don't know if it's true that online ads are less effective than print, but I know that there are a heck of a lot more of them to compete for advertising dollars. Advertisers still pay for reach into a target market (which is why you can get crazy high CPM rates for things like travel forums), but today there are simply a lot more sources for undifferentiated eyeballs than there were in the 60s.

jyothi 18y ago

Absolutely to the point: Advertising isn't as effective online as it is in print. One possible reasoning is a web page is transient as opposed to a news paper ads, most of us involuntarily would have stared at the first page ad at least 2 times in a day. The conversion path has been made short and efficient online but a lot of branding aspect is taken away from these ads. Additionally one should also note that there is a small guaranteed price we all pay to read that daily newspaper. Which probably does ensure that journalism doesn't go completely bust in leaner times. Which is exactly what NYT is proposing and I agree with Matt Maroon's opinion completely.

erik 18y ago

"Advertising isn't as effective online as it is in print." Is the effectiveness of online advertising the problem? Or is it the relative price? I have the impression that advertising in print is vastly more expensive than advertising online. Does anyone have any insight as to why this is the case?

timr 18y ago

"Newspapers have historically derived almost all of their revenue from advertising" That's actually not true. As recently as the 1960s, big newspapers made nearly half of their revenue from subscriptions: http://onthemedia.org/transcripts/2009/02/06/03 http://onthemedia.org/transcripts/2009/02/06/03 As far as ad revenue goes, I don't know if it's true that online ads are less effective than print, but I know that there are a heck of a lot more of them to compete for advertising dollars. Advertisers still pay for reach into a target market (which is why you can get crazy high CPM rates for things like travel forums), but today there are simply a lot more sources for undifferentiated eyeballs than there were in the 60s.