Guardian adviser: Subscription not the online answer

The Guardian’s US web strategy adviser Caroline Little has said that subscription charging is unlikely to work for online news businesses – and said the industry had still yet to find the “secret” to making the web pay its way.

Giving the keynote speech at the WAN digital publishing conference in Amsterdam this morning, the former Washingtonpost.newsweek Interactive chief executive said that despite the current downturn in the advertising market, she believed the fundamental ad-based model for digital publishing was still the right one.

“There’s an unprecedented amount of gloom and doom enveloping the media business these days. Media companies with once-obscene profit margins are now struggling to maintain profits at all,” she said.

“The revenues digital newspapers have enjoyed remain a small fraction of their print counterparts. It isn’t nearly enough.

“If there was some secret sauce that could turn these unprecedented news audiences on the web into lots of revenue, I have not found it. And I have been looking for a long time.”

Little said that regardless of the “cold, hard facts”, she felt there had never been “a more exciting time to be in the journalism business”.

She added: “I believe the fundamentals of the business being primarily supported by advertising revenues will remain the same.

“Some niche areas may be able to assess a subscription fee, but given the competition in news, it is difficult to foresee that happening.”

Little urged news publishers to do more than repurpose print content online, and pointed to database journalism as a major growth area that was not being effectively embraced.

“You can only publish as much good journalism as you can produce, and that takes skilled reporters and editors,” she said.

“Most papers have fewer reporters and editors than it did a few years ago. But what that endless storage space is perfect for is databases that can useful to your readers.”

Little concluded: “We still have a long way to go before declaring victory. The good news is that we’re still in the early innings of this ballgame.

“If we can aggressively embrace the opportunities ahead of us, I believe we’ll survive this storm.”

Little was hired by Guardian News and Media in July to advise the publisher on its online expansion in the United States.

The group has been growing its US presence with a dedicated site, Guardian America, edited by Michael Tomasky.

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