Across the pond

Most of the comment about charging for online web content since Rupert Murdoch declared that he plans to charge for his online newspapers by 2010 is asking the wrong question. The dilemma for all newspaper managements is not whether to charge, it is how to charge, how much and when?

The reason we have all been reading about this question this week is that newspaper companies have been announcing huge losses, the first losses which demonstrate the combined effect of the credit crunch and the effects of the massive expansion of on-line reading in the last two years. Including the £90 million loss by The Guardian the most successful of all newspaper sites in the last two years. The real reasons for The Guardian losses were obscured by the simultaneous leak of a proposal being put to the Scott Trust, owners of The Guardian, to remove some of the red from the profit and loss account by effectively killing off The Observer.

Shock, horror. Britain’s leading left of centre newspaper group, had prepared a dummy of  The Observer magazine, intended for Thursday publication, in order eliminate the high cost of publishing the Sunday newspaper, which has to compete with the Saturday Guardian which has more than enough reading matter for the whole weekend.

BBC Newsnight wheeled in the heavies from the past to denounce this dastardly plan – Harold Evans,  Sunday Times editor during the great years of Thalidomide etc, and Donald Trelford, who edited The Observer when it had a circulation twice as big as the current one. They called on the people to rise up and stop the murder of Britain’s oldest newspaper.

Which I predict will not now happen.

Thanks not to anything Evans and Trelford had to say, but to what Rupert Murdoch did the following day. Murdoch has been hinting for some time that he was considering charging for online content. This week he has been telling the world that he has made up his mind. He has opted for charging.

Shrewd as ever he is moving stage by stage. And the first experiment will be with the Sunday Times, which has a print circulation twice as big as the daily. Presently TimesOnline carries the content of both papers, although there are distinct differences in style and content.

In effect Murdoch is declaring that he thinks the Sunday Times brand is strong enough to get the public to pay for what they have been receiving free for the last few years.

Murdoch’s action, assuming he is judging the public mood right, will be good for his own company profits, but it may do even more good for other serious newspapers around the the world, not only The Guardian and The Observer, the Independent, the Telegraphs, but also The New York Times and the Washington Post.

Neither of the others were rich enough to make the first move. Indeed, for The Guardian or, say, the Washington Post, to move first, would have been suicidal.

From now all newspaper managements can forget worrying about whether or not to charge for online charge, and to decide when, how and how much.

Their is scope for a variety of answers. One fee for a one-off purchase, another, much smaller charge, for annual subscriptions. Whether to follow the FT model of combining a charge with free access to headlines and intros and so many articles per month.

And the Scott Trust, at its next meeting, will be able to discuss whether to go ahead with the Observer as a Thursday magazine, or simply to follow in Murdoch’s footsteps, and experiment with a separate Observer website. The extra technical costs of running a separate site would be trivial. But there would be significant editorial costs.

Inevitably, since its takeover by The Guardian, The Observer has begun to look more like a Sunday Guardian. Since economics dictates that both newspapers will have to stay on the Berliner format, nothing can be done about the appearance. But it is a viable option to recruit a few extra Observer journalists, and to encourage a more different editorial slant.