Journalism is in a state of recovery (or rebirth, as some would put it) after advertisement and classifieds revenue evaporated with the advent of the Internet. When newspapers and magazines leapt to the Web, they threw expensive-to-create content to hordes of readers, free of charge. That mistake still haunts the industry, but a pair of recent media moves has me optimistic that journalism will once again be a prosperous business.
Last week, HBO announced it would offer a standalone streaming service beginning in 2015, meaning consumers will for the first time be able to enjoy the network’s premium content without a cable subscription. On another coast and in another medium, The California Sunday Magazine launched. It was, at least to folks on the West Coast, the highest-profile print media launch in quite some time, though it garnered far less attention than HBO’s move.
The two companies will operate in different spectrums of the media landscape, but both offer positive signs for journalism. HBO is setting a precedent for a business model journalism has for some reason avoided: producing great content, and making customers pay for it. California Sunday is also placing great emphasis on subscriptions, and is making a bet on regional content in the process.
HBO has for years created top-notch content without being beholden to advertisers. It’s a concept journalistic publications for some reason can’t fathom. Magazines and newspapers have traditionally made their money off the blank pages between the stories, not the stories themselves. The same goes for broadcast media and the blank air time between the content. Sure, more people used to subscribe to journalism, but there has never been a direct connection between a journalist’s product and a journalist’s revenue. Ads have always been in the middle.
But why can’t a publication generate revenue based solely off its content? This concept has been embodied by HBO, but there is a catch — a cable subscription. HBO has succeeded with a subscription model, but another subscription is needed before purchasing HBO is possible; no Comcast or Time Warner or Cox, no HBO. But with the announcement of its new streaming service, HBO kicked down that wall. Its business model is now incredibly simple — we make a product, you buy it.
If journalism adopted this model, it would directly tie the product to the revenue. News, contrary to the detrimental paradigm publications established online, is not free. It costs money to report, so it’s not crazy to think one should pay to consume that information. Sure, there’s a moral case to be made for free news, but folks in D.C. and elsewhere aren’t too keen on amply funding PBS and NPR. Thus, the private sector must present much of the news, and a business model like HBO’s would promote quality far better than the current revenue-stream mishmash of ads, subscriptions, and sponsorships.
Journalistic publications aren’t flocking to HBO’s model, but California Sunday is showing that the industry is becoming more savvy to the digital balance. The magazine is investing heavily in print — it is distributed in Sunday editions of California’s three largest newspapers — and ad revenue appears to be the economic driver, but California Sunday‘s online approach is a mature one. Rather than getting all the magazine stories for free, online readers must pay at least $40 a year to read beyond the three free stories allowed per month.
It’s a bold approach for a new magazine, but California Sunday has bold goals. It aims to cover California, the West, Asia, and Latin America for a national audience. The subject matter is deserving — the West is ripe with stories — but pitching a regional pub to a national audience might be challenging. I can see Westerners embracing the publication, but why would someone from Ohio subscribe to a magazine that will never mention Ohio? If California Sunday can find a harmony in its content and target audience, it could turn into a special publication.
So HBO is pioneering a subscription economy, and California Sunday could set the standard for the new wave of regional pubs. I’m anxious to see a hybrid of the two — a regional publication that is able to sustain itself with readers paying directly for the content, no ads required. Other revenue streams should be encouraged, but let the primary one be that which is most closely tied to the product itself. If that model can work, the next journalistic golden age might be upon us.