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A.H. Belo-owned Providence Journal considers charging for online access
Nov 26, 2009 (The Dallas Morning News - McClatchy-Tribune Information Services via COMTEX) --
The Providence Journal, a sister newspaper of The Dallas Morning News, might start charging for some content on its Web site early next year, executives at both newspapers said Wednesday.
Charging for online access would amount to a significant shift at a time when most U.S. newspapers face plunging revenue, declining print readership and difficulties making money from online traffic.
"It is not a done deal, but it is under serious investigation," said Howard Sutton, publisher of the Rhode Island daily. "The main objective is to protect our core print business and to insulate us from circulation losses. Projo.com is a very robust Web site, and it's becoming evident to us that it's a very strong competitor to our print product."
The Providence Journal belongs to Dallas-based A.H. Belo Corporation, which also owns The News; The Press-Enterprise in Riverside, Calif.; the Denton Record-Chronicle; and other specialty publications.
Jim Moroney, executive vice president of A.H. Belo, confirmed that the Providence paper might start charging for some online content.
Moroney, who is also publisher and chief executive of The News, said the Dallas newspaper has a task force exploring whether to charge for online content, and what form such charges might take.
"From a Dallas Morning News perspective, we're going to learn some things from what will probably eventually be a test in Providence, assuming they do one," he said. "You're going to need to find a way to monetize the value of the news and information that you publish -- or, if you will, of the audiences that you attract for that news and information."
A.H. Belo is one of many U.S. publishers reassessing its Web strategy.
According to reports this week, media conglomerate News Corp. has held talks with Microsoft Corp. about a possible deal in which the software giant might pay News Corp. to display links to its news stories only on Microsoft's search engine, Bing. As part of the agreement, News Corp., which is led by media baron Rupert Murdoch, would remove links to its news stories from Google.
Separately, leading magazine publishers including Time Inc. and Conde Nast Publications are reportedly close to launching a joint company that would sell print and digital products from magazines such as Time, Vanity Fair, The New Yorker and Sports Illustrated.
With print circulation waning and advertising revenue falling, the search is on throughout the media industry for online profits, said Porter Bibb, a longtime investment banker specializing in media, entertainment and technology.
"Many, many advocates of the Internet say the Internet equals free, and you can't break that model," said Bibb, managing partner of corporate finance at Mediatech Capital Partners, a merchant bank and advisory firm. "The fact of life is you simply cannot afford to produce quality content, real professional content, if you're not getting paid."
But it remains uncertain how much consumers would be willing to pay, analysts said.
The Newport Daily News, a newspaper in Newport, R.I., began charging for online access earlier this year. For print subscribers, online access ranges from $11 for four weeks to $100 a year. Prices for non-subscribers range from $5 a day to $345 a year.
At The Providence Journal, publisher Sutton said the newspaper could start charging as soon as March.
He declined to discuss possible pricing plans. But he said seven-day home delivery subscribers probably would be given full access to the Web site. Weekend-only subscribers might be offered a reduced price for online access.
"I think it's a model that's going to help us protect our product, grow the business and also allow us to continue to invest not only in print journalism but online journalism," Sutton said. "I think people realize that newspapers with excellent journalism cannot continue to give away their product for free."
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