A revolution appears to be unfolding in the news industry, driven by a mix of mistrust, a decline in traditional TV viewership and revenue, and a world increasingly plugged into phones rather than televisions. As a result, news companies are shifting strategies and targeting the digital news consumer.
However, the news business model is still struggling to find a way to generate revenue in this new landscape. Many media groups are transitioning from TV advertising to online paywalls.
A recent survey found that only 12% of voters have paid to subscribe to at least one news source. Despite this low number of paid subscribers, several prominent news outlets are betting on that figure growing.
CNN made the switch last month, asking users to subscribe after a few free articles.
In its announcement, CNN acknowledged the challenge of shifting from cable TV to digital revenue, noting, “For brands like CNN that make most of their money from cable television, the challenge is clear: to develop new digital revenue streams that can offset declines in legacy TV.”
Reuters followed, activating its paywall last month. The company stated, “This new subscription plan ensures Reuters can expand the reach of its award-winning coverage at an affordable price, while allowing us to further invest in our reporting and products for subscribers.”
Reuters and CNN join a crowded field. A study from the Reuters Institute found 75% of America’s leading newspapers and magazines are behind paywalls. That same report found 30% of all news sites use paywalls.
However, the study also revealed that 80% of Americans aren’t interested in paying for news.
The digital-first approach has been costly for some companies.
This year, the BBC announced it would cut 500 full-time positions. Disney’s ABC TV stations laid off 3% of its news division.
CNN also reduced its workforce by 3%, the LA Times cut 20% of its newsroom and The Associated Press announced an 8% staff reduction.
The AP stated, “Our customers — both who they are and what they need from us — are changing rapidly. This is why we’ve focused on delivering a digital-first news report. We now need to accelerate on this path. Doing so will require making some difficult changes so we can invest more fully in our future.”
Some media analysts suggest the move toward charging consumers for news could also harm the quality of news as people search for trustworthy, free content.
"Only 12% of voters pay for news." 📰
— Frank Luntz (@FrankLuntz) November 19, 2024
Keep this in mind when you're wondering why misinformation spreads so rapidly, while the articles/posts that debunk it can't seem to make a dent. https://t.co/Kf28VTvEwH
Pollster and Straight Arrow News opinion contributor Frank Luntz posted on X, “Only 12 percent of voters pay for news. Keep this in mind when you’re wondering why misinformation spreads so rapidly, while the articles and posts that debunk it can’t seem to make a dent.”
The Atlantic, a left-leaning news organization, also wrote about the decline of credible news consumption in a world where much of the news is locked behind paywalls. The article, titled “Democracy Dies Behind Paywalls,” was itself behind a paywall.
Claire Wardle is the founder of the nonprofit First Draft, which focuses on misinformation. She told Boston’s NPR station people aren’t paying for news. She also claimed this business model is pushing them further away from traditional news sources.
“When people go and search on Google, they’re just not able to open the link at sites that have fact-checked information,” Wardle said. “There’s now this ‘like what’s the point?’ feeling. So we know that people are turning to one another for information, spending more time on social media platforms where there are other people giving that information for free. They’re spending more time listening to podcasts and relying on these closed sources of people who look like them, sound like them, and give them information that reinforces their worldviews.”
