The Spotify for news! I like this solution.
Andy Meyer
11

Thank you for your comment Andy.

One of the most difficult aspect of the newspaper business is that it requires a lot of money to run. I’m not advocating a 10 dollars Spotify or Netflix-like subscription in price as it would never be enough to produce significant revenue for the industry.

If we take the Swiss market as an example, the amount of money the print news and magazine industry is used to receive directly from consumers (not counting ad revenue) is about 2 billions CHF per year for around 3.5M households.

It means that on average, an households in Switzerland spends close to CHF 50.- per month on news and magazine which is a significant amount. The problem is that print circulation has been falling which reduce both distribution and advertising revenue while the cost to run the business stays the same.

It’s not possible to replace the lost revenue with online advertisement as the publisher do not control the prices and cannot increase the amount of advertisement without putting off the consumers. The only way to increase revenue is to take more money from the consumers through subscriptions or micro-transactions.

For a subscription to bring meaningful revenue, the amount has to be significant, probably more than CHF 35.- / month. For that amount, you need to offer some serious value to the consumers if you want people to subscribe. Incidentally, 35.- is the mean price for current digital news subscription in Switzerland but at this price level for a single digital paper, it is too much for too little and those offers have few subscribers.

What I’m advocating is that the same 35.- should give you access to many newspaper from many publishers and that a Spotify-like revenue sharing mechanisms allow for publisher to receive their fair share of revenue.

Since most people will not subscribe to more than 1 newspaper, it would not change industry revenue as a whole. It would just give more value to consumers and incentive more of them to actually subscribe to digital news subscription hence bringing more revenue for everybody.

Show your support

Clapping shows how much you appreciated Guillaume Michalag’s story.