How Much Would You Pay for Internet News?
News Corp. to charge for news online and expects other media sites to follow.
Aug. 7, 2009— -- A price tag is about to accompany more of the news you read online.
In a call with investors Wednesday, media magnate Rupert Murdoch signaled that his company, News Corp., is preparing to charge for some news content provided by all its Web sites, from the Wall Street Journal, which already charges customers, to Fox News, the New York Post and newspapers in the U.K. and Australia.
"The digital revolution has opened many new and inexpensive methods of distribution," he said. "But it has not made content free. Accordingly, we intend to charge for all our news Web sites."
And he didn't stop there. Assuming the strategy works, Murdoch predicted other companies would fall in line.
"I believe that if we're successful, we will be followed by all the media," he said later, adding that the company was thinking about making the changes by next summer.
Although Murdoch has raised the possibility before, and isn't the only one to consider a paid approach, his comments sent ripples across the Web, as industry watchers pondered the implications of the media giant's decision.
But although they said News Corp.'s move could herald a shift in Internet news, media experts caution that the issue is hardly black and white. There are many degrees in the spectrum from free to paid content, they say, and news Web sites are expected to experiment with many of them in pursuit of the Holy Grail.
News Corp. did not immediately respond to requests for comment from ABCNews.com, but David C. Joyce, a media equity analyst for investment firm Miller Tabak & Co. LLC, said that if the company didn't start charging for content, the quality of the news would diminish over time.
As media companies see that revenue from advertising isn't following them online, he said, they need to find other revenue streams, like those from paid subscriptions.
And although it won't be easy at first, he said, it's better to retrain customers sooner rather than later. "They're trying to put the free genie back in the bottle," he said. "It's tough to get the consumer to pay for something that they're used to getting for free."
But as customers continue to see quality decrease at sites that are free or watch the pool of free sites slowly decrease altogether, they could come around, he said.
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