Journalism Online, would-be newspaper savior, gathers steam

Hardly a day goes by without some piece of news about newspapers trying to devise fresh ways to get consumers to pay for all the free content they're currently pushing out over the web. Just last week, for instance, The New York Times asked subscribers if they'd pay $5 a month for website access, while Rupert Murdoch mused about what role micropayments and e-readers might play in The Wall Street Journal's future.

It's easy to forget just how recent this state of affairs is. "We announced we were doing this in the second week of April," says media entrepreneur Steve Brill -- "this" referring to Journalism Online, the company he founded to help newspapers and other outlets start charging for digital content. "If, on that day, you had called the ten largest newspaper and magazine publishers in the country and said, 'Are you going to charge for any of your online content in the foreseeable future?' you would have gotten a significant amount of 'I don't know," he says.
"Today, I think all of them would say, 'We don't know how much, we don't know how we're going to charge, but yes, we expect that sometime, at some point, we're going to be charging for some portion of our online content,'" he adds. "The debate has really shifted."

It's a major sea change, and Brill and his partners -- former Wall Street Journal publisher L. Gordon Crovitz and longtime telecom executive Leo Hindery Jr. -- couldn't have timed it better. Sometime in the next two weeks, they plan to go public with the identities of their first affiliates. They've been pushing off the announcement for the past month -- not because they've been having trouble lining up clients, they say, but because they've been adding new ones so fast, the list keeps evolving. "We're confident we're going to have a significant number of news brands participating when we launch in the fall," says Crovitz.

And those news brands won't just include newspapers and magazines. "A lot of the focus has been on newspapers because they're in the most dire economic situation, but our engine works for any digital property," says Brill. I asked them whether Journalism Online has signed up any news sites attached to TV news networks such as MSNBC.com and CNN.com, which are two of the top three online news destinations, according to Nielsen. "Just to be fair to everybody, we can't acknowledge any particular ones [yet], but we are talking to ones like those," says Crovitz.

In fact, they're talking to just about everyone. Brill and Crovitz say they have yet to be rebuffed by a potential affiliate. "The harshest answer we've gotten hasn't even been, 'No, let's wait and see,'" says Brill. "The harshest answer has been 'Let's get together and talk.'"

"Some publishers are trying to get a clearer view of their business model before engaging with us," adds Crovitz.

And many have learned that what Journalism Online's offering is more flexible and compelling than it may have sounded at first. Far from a one-size-fits-all approach, the company allows news outlets to customize their pay schemes with 15 different variables. Publishers will be able to do everything from selling monthly subscriptions to charging micropayments for individual articles with a sliding pricing scale based on the timeliness of the news. "What we're giving them is a set of dials they can constantly turn," says Brill. "In no case is is simply charging or not charging. It's not simply a pay wall goes up around everything."

"I think it's fair to say almost all of our affiliates are thinking about the hybrid or 'freemium' model where there'll still be a lot of people who are accessing services or content for free," adds Crovitz.

Some of what Brill and Crovitz are saying sounds almost too good to be true. They claim that publishers who sacrifice 10 percent of their pageviews by instituting a partial pay model will be giving up far less than 10 percent of their advertising revenues because the last 10 percent of ad inventory they sell is low-cost ad inventory. Moreover, advertisers will be "happy to pay a big premium" for ads served to paying readers, says Crovitz. And, adds Brill, newspapers that begin charging for web content will see increases in their print circulation as readers opt for bundled subscriptions.

"The more people look into it, the more they understand they can have their cake and eat it, too," says Crovitz.

Maybe. This much, at least, is for sure: With no better options presenting themselves, a lot of publishers will sign on with Journalism Online to find out if it it can deliver on its sales pitch.

"You're going to see lots of publishers trying lots of different things," says Brill. "And then, as it shakes out, and as we provide them the information about what's working and what's not working, a year from now the verdict could be in."

For the entire transcript of Jeff's interview with Steve Brill and L. Gordon Crovitz, click here.

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