John Naughton's talking sense about economics, news and the Web today in the Observer:
Things have got so bad that Rupert Murdoch has tasked a team with finding a way of charging for News Corp content. This is the "make the bastards pay" school of thought. Another group of fantasists speculate about ways of extorting money from Google, which they portray as a parasitic feeder on their hallowed produce. And recently a few desperadoes have made the pilgrimage to Capitol Hill seeking legislative assistance and/or federal bailouts for newspapers
It's difficult to keep one's head when all about one people are losing theirs, but let us have a go. First of all, some historical perspective might help. When broadcast radio arrived in the US in the 1920s, nobody could figure out a business model for it. How could one generate revenue from something that could be listened to by anyone for free? Dozens of companies were founded to exploit the new medium, and most of them folded. The problem was solved by a detergent manufacturer named Procter & Gamble, which came up with the idea of sponsoring dramatic serials: the soap opera - and the mass market - was born.
The moral is simple: eventually someone will figure out a business model that works for online news. But it may take some time, and lots of outfits will fall by the wayside in the meantime. That's capitalism for you.
Volume and diversity: the future's bright for news online
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