Author: Daniel Graf
The subscription model, rendered obsolete a couple of decades ago, is making a comeback. The New York Times reported in early February that the company added 157,000 net digital-only subscriptions in the fourth quarter of 2017, capping off a strong year in subscriptions. It appears to be part of a trend. CNN reported that the Wall Street Journal (WSJ) added over 305,000 subscriptions the year ending March 31, 2017.
Subscription revenue for the New York Times accounted for more than $1 billion in 2017, or 60 per cent of the company’s total. Advertising is still a significant chunk of revenue and will remain so, but it’s an interesting picture into the possibilities for journalism in an ad-free zone.
“We still regard advertising as an important revenue stream,” said Mark Thompson, chief executive for the newspaper, but added during the earnings call that, “… our focus on establishing close and enduring relationships with paying, deeply engaged users, and the long-range revenues which flow from those relationships, is the best way of building a successful and sustainable news business.”
The Economist ran a report last October that describes a “paywall” model. In the article, which references several established press organizations, the Economist reports that, “The Post has settled on three site visits a month before hitting the paywall, which means 85% of visitors will not encounter it. The other 15% are asked to subscribe at the introductory rate of 99 cents for the first four weeks.” It’s an intriguing way to capture potential subscribers while not scaring away those not quite prepared to signup.
“Advertising has always been a ‘tax’ on our attention”, according to Bob Gilbreath in a Medium piece. “The ‘free media with advertising’ grand bargain seems more like a bad deal as the value of our attention spans rise. We have more media choices and distractions than ever before in our lives. We are multi-tasking and keeping up with many things at once. Pausing to watch an advertisement is a speed bump in our busy lives. And once we cut some of these interruptions out with subscriptions, the remaining ads we do see feel even more painful — thus shifting the value equation toward skipping and subscribing.”
The same article also references positive trends in ad-free radio, highlighting Spotify, SiriusXM, and Pandora. According to the piece, “Pandora is moving to a subscription because of profit pressure from public investors who are tired of subsidizing an ad business model that hasn’t materialized. The investor community in general has become enamored with Software as Service (SaaS) subscription business models because they bring predictable, recurring revenues.”
It doesn’t stop there. The Verge reported just this February that not only would Amazon Prime customers be available ad free to customers, but also that the company would stop displaying advertisements and offers on the lock screen of partner phones for Prime customers.
Concurrently, the Netflix business model for some time has been to push smart content out to subscribers, also without advertisements. SportsFacts featured a piece last June that Netflix will overtake ESPN in total broadcasting budget in 2018, another indication that demand for subscriptions is trending positively.
The growth in digital press subscriptions comes within the context of questionable and blatantly fake stories being shared across social media channels. Just prior to the 2016 election, a Washington Post analysis stated, “As part of a larger audit of Facebook’s Trending topics, the Intersect logged every news story that trended across four accounts during workdays from August 31 to September. 22. During that time, we uncovered five trending stories that were indisputably fake and three that were profoundly inaccurate.”
We all know what came next. A recent Vanity Fair piece reflects on a negative outlook for Facebook and speculates on scenarios for a regulatory breakup of the company.
In an attempt to address murky sources and fake news being spread on Facebook, Twitter, and even Google, those very same companies are endeavoring to launch programming changes that will inform readers of the trust level of a particular piece. The technology is a digital attempt to vet stories. Icons are to appear on screen to indicate to a reader the confidence levels regarding accuracy. The results are still unavailable. The effort will be complex — users with multiple accounts for one. Also, as the effort is likely to be driven by algorithms, how much material will fall through the cracks?
TechCrunch reports on the details of the Trust Project, an effort with the participation of 75 major news organizations, to bring back accountability and ethics to what we regard as news. Sally Lehrman, the founder of the project, stated: “An increasingly skeptical public wants to know the expertise, enterprise and ethics behind a news story. The Trust Indicators put tools into people’s hands, giving them the means to assess whether news comes from a credible source they can depend on.”
The initiative is funded by Craigslist founder Craig Newmark’s Philanthropic Fund, Google, and several other philanthropic organizations. They released eight indicators to help readers assess their own degree of confidence in content they encounter. These include a look into standards, a source’s mission, details about the journalist (such as their expertise or other stories), better access to references, as well as information about whether content is locally sourced. We shall see to what extent companies like Facebook and Twitter can or want to enforce such standards on a real-time basis. There’s been talk that efforts are too little too late as reported by the Guardian and elsewhere.
Interestingly, there are emerging ways of encouraging reader engagement. New methods of payment — perhaps micropayments done on the blockchain — could monetize articles while helping transparency. Voting on content choices and enforcing a rigorous set of standards could rest with the readers. This is a model the Decentralized News Network (DNN) is implementing.
The platform will not source revenue from display ads. DNN is run as a network, fueled by a token, which will motivate each action, including writing and reviewing of articles. DNN’s system is a self-sustaining and autonomous environment that leaves little room for bias. Compensation is derived from community’s engagement, rather than from external revenue streams such as native ads or even subscriptions.
About DNN
DNN is a news curation platform powered by the Ethereum blockchain. It’s our goal to encourage the dissemination of factual, unbiased political news by incentivizing accountability at all levels of the news consumption process.
We’re news for the people, by the people.
Read our latest stories on the DNN Medium channel. Visit the DNN website to learn more about our project. Stay up-to-date with the latest project news by following our social channels: Twitter, Facebook, and LinkedIn. You can also join our project conversation on Slack, Telegram, and Reddit. Our DNN token presale is currently live. To participate, contact presale@dnn.media.
We’re currently in need of journalists, writers, readers, and editors to test out our Alpha updates! Check out our website today, and let us know what you think. Participating in our Alpha will earn you bounty stakes for our DNN Token.
