1 December, 2009
So the multi-billionaire Rupert Murdoch reckons that all his ‘news’ is being stolen by Google and it follows, the rest of us, so next year he plans to start charging for access to his ‘news’.
My first reaction is to say hooray! Aside from research and references, I never read anything News Corp. produces, so let him charge. So for many of us, not being able to read Murdoch’s rubbish online will not a be loss, if anything it might declutter the online world somewhat.
But the issue is much more complex and important than Murdoch wanting to get his pint of blood many times over.
I think the first thing to do is to look at the content News Corp. produces/owns/distributes: where does it come from and how is it paid for?
The bulk of News Corp’s content starts life in print, radio and video, some of which makes it online either edited or ‘massaged’ in some way. This is called ‘refreezing’ the product, so essentially the same content can be used over and over again. This is what ‘convergence’ is really all about from the business perspective.
So the bulk of the ‘news’ allegedly stolen by Google et al, has already been paid for and made a profit through some other revenue source such as advertizing or sales (depending on the content’s source). And let’s not forget that Murdoch owns the Sky satellite network, the source of much of News Corp’s revenue as well as radio stations, and the critical distribution networks and supply chains eg, TNT.
The other aspect to bear in mind is that Murdoch treats the Web as if it’s his property, but News Corp. didn’t pay for the infrastructure, it uses the same networks as you or I do. It ‘steals’ content just like Google and pretty much everyone else including the BBC. The BBC does it every time it puts an external link onto a page that leads to a News Corp site.
Some years ago I got involved in doing research on how much it actually costs to produce a typical news item for a newspaper. The news company in question had no idea what it cost to produce x column inches of story and they needed to know in order to figure out how to charge for the online news version of their print product.
But aside from the actual cost of putting it online, the startup costs and that the transfer process is automated, is virtually nothing, pick your own figure… what difference does it make what you charge, whatever revenue it generates is icing on the cake. Hopefully there’s enough advertizing revenue to make up whatever ‘losses’ the online content makes. As the head of one world’s largest media conglomerates put it to me in 1994 when I explained to him what the Web was all about, replied that it “sounded like a licence to print money”.
So the issue isn’t really about Murdoch losing revenue, that’s pure bullshit. No, Murdoch is engaged in an ideological battle for our minds. He wants to put an end to the idea that online information is essentially free. In other words, he wants to commodify information just like everything else capital gets its dirty hands on.
The ethos that powered the Web, ‘All information is free’, is an anathema to Murdoch and his ilk, so what he’s trying to do is set a precedent about paying for access to information. He’s betting that if he does it the rest of the media corps will follow.
But let’s assume News Corp makes us all pay for its online content, is it practical? Will it work? To be effective, it needs something like London’s Oyster Card for the transport network. You charge it up with cash and swipe it as you go. What they call a micro-payment system. But for this to work enough of us have to literally buy into it.
News Corp. claims that it’s done the research and enough will pay to make it profitable.
This is from the aptly-named Website paidcontent.co.uk:
‘Sure, some readers will pay for online news content via single-article micropayments, but only if the price tag is very low. That’s according to a report from analysts at Continental Research, which found that 63 percent of a 500-person survey ruled out paying for online news content. Of those that would consider getting their wallets out to pay for Times Online and the rest, three quarters agreed their upper price limit was a measly 10p.
‘Continental’s head of research James Myring says some paid content is better than none: “The amounts may sound small, but it is better to get a lot of people making small one-off payments than virtually no one paying a higher subscription.” But is 10p an article from a minority of the public enough on which to base a digital-business model?
‘Our own research series on paywall attitudes in September found that even fewer readers would be prepared to pay—just five percent—and that 96 percent of readers would pay no more than 10p for a single article.
‘—Continental’s survey uncovers a sceptical attitude to the long-term deal News International and others hope to sell: just five percent would buy such a subscription. Our research found that over half of online readers preferred monthly or yearly subscription deals to other models. — Research: Readers Favour News Micropayments—But They’ll Only Pay Pennies. paidcontent.co.uk
Of course if the pay-for content became prevalent, I wouldn’t have been able to do this—quote from an online source—without paying first, even though I’ve just grabbed a small piece of the entire article. You see the problem, pay-for has to be ubiquitous for it work effectively, in other words the bastards want us to pay to go online (that’s on top of our bandwidth/connection/download charges)!
10p a view, max? Today (30 Nov), Creative-i had 306 articles read, but of course most are not copyright by Creative-i, so how do I share around the thirty quid (most are not even copyrighted)? And this assumes that the same number would be read if they had to pay 10p per item.
The very nature of the medium transforms the meaning of the word ownership, this is why the capitalists are having such a hard time getting their heads around the idea, that is to say, how do you make money out of the damn thing? In the early days of the Web (the early 90s) it was the numero uno question being asked by what was then mostly print and TV businesses.
Back then, the prevailing view was that advertizing would pay for the content (content which for the most part had already made a profit in some other form). But most print media companies viewed the Web as a threat to their print products– if they took them online. Why buy the product if you can get it online for free?
But think also about the infrastructure that’s in place, the bulk of it paid for by the public through their taxes over the decades that it took to construct the global network, virtually all of which still devolves down to the thin copper cable that comes into your house or apartment.
In order to make the Web ‘pay’ an entirely new approach is needed, for not only is it about what we ‘consume’, it’s also about what we contribute.
If Murdoch wants to charge for News Corp’s content then it makes sense that News Corp should pay for all the content it takes, for free, from all kinds of sources including its ‘citizen journalist’ sources whether it be video footage or eyewitness reports.
In other words, the Web needs some kind of universal ‘credit-debit’ sharing system along the lines of text messaging, where revenue is shared between the telco and the company that owns the messaging product.
But is such a system practical? To put it in place would mean the entire restructuring the Web’s technology. Forget Web 2.0!
Some years ago along with a friend of mine, we devized a system called MIMO (More In, More Out) that would track every transaction, that is, access to content or contributed content and put debits or credits into the user’s account. Such a system would use what we called an Anonymous Information Server.
MIMO was actually a method for creating entirely new ‘currency’, the MIMO, whose value would be based on usage. Over time it would measure access to content and value it accordingly. MIMOs could then be used to purchase content, services or even products along the lines of the LETS system.
“MIMO is a ‘work in progress’, that starts from the point where use value is transformed into cultural capital and, over time (as with the evolution of money from being a portable form of barter, to being a commodity) establishes a mechanism for measuring value generation that has meaning in the real world, insofar as it can compete on ‘equal terms’ with the world of traditional, commodity-based use values determined by (in part) production costs.
“Financial value is no longer a sufficient indicator of real value – there are too many unaccounted for characteristics – everything from environmental impact value to sentimental value – and crucially, we have no way of accounting for these ‘intangibles’ in the present economic system. Moreover, as value is now increasingly held in intellectual processes which can be used over and over again and with use, either lose or gain in value, a method is needed that measures this new, variable value.
“We are calling this variable (dynamic) value, Cultural Capital and its unit of value, a MIMO.
“Cultural Capital also reflects the increasingly collectivized nature of all wealth production – that is, wealth that is the product of an entire array of globally inter-linked intellectual and physical production processes, which when taken in isolation have no value that can be effectively measured in their relation to the whole. It is only when we measure intellectual wealth collectively that these values can be measured and importantly, shared by the individual producers.
“But in order to measure Cultural Capital, we need a system that can accurately track and calculate the variability of this new kind of value.”
Such a system (or something similar) directly challenges the state/corporate monopoly on money and how value is measured and why Murdoch’s attempt to commodify the Web has to be stopped.