Free, But At What Cost?
Thursday, October 15th, 2009 by Lucinda M. DuggerFree. Friday night dinner in undergrad. My friends and I would hop from one art show opening to another and graze the complimentary cheese and wine table to make an evening dinner.
Today I only go to art show openings if I’m interested in the art. I wouldn’t dream of going out of my way to view art just to piece together a dinner. Why? I can afford a good dinner and still have a good time with a fraction of the amount of hassle.
Free. My first car. Okay, it wasn’t entirely free, but I only paid $700 for my 12-year-old red Chevy Corsica. The paint was pealing and the doors would freeze shut in the winter. But, I drove the thing for six years, barely put any money into it, and sold it for $300. It might as well have been free.
Today I wouldn’t think of buying such an old, rickety car at the expense of my safety, time spent on getting the doors open in winter, or having a monthly car payment. I prefer to have a new car with a repair warranty and a monthly payment in order to have one that is better and higher-quality.
Free. After 182 years as a paid newspaper, the London Evening Standard has become free. With sales and circulation down to under 250,000 copies a day, instead of opting to fold, the paper is now giving away 600,000 copies. The results have been mixed as some devoted London readers, who had previously paid for the paper, cannot get their hands on a copy and have vowed to give up the search. While others delight, I’m sure, at being able to indulge in high-quality journalism at no cost.
So, how will it survive? It helps that Russian billionaire Alexander Lebedev owns over three quarters of the newspaper. But the underlying hope is that by streamlining distribution, cutting staff, and making other cost-cutting measures as necessary, the paper will survive on revenue generated by ad sales.
In the newspaper industry, the cost for an advertisement goes up when the newspaper is widely circulated and has an attractive demographic. The Standard is hoping that by increasing circulation and by focusing on young, wealthy, midtown urbanites, it will attract high-paying advertisers and increase classifieds usage.
This should, in theory, sustain the newspaper. And it very well might, but there are a couple things that concern me.
One. Lebedev vows to keep up the newspaper’s reputation as providing high-quality journalism. Yet, there are hints that staff might have to be let go in order to streamline business and help reduce costs. If the paper begins to make decisions like U.S. newspapers have, then the result will be too few accomplished writers stretched over too much news, and fewer editors. These are not exactly parts of the equation that equal good or successful journalism, as we have seen in U.S. papers.
Two. Ad-based support for newspapers and websites is becoming more and more the norm. On the one hand, it makes sense. Ads have been a part of our media experience since the early days of letter press printed newspapers. But until recently, sales have been the primary way to sustain the newspaper, not advertisements. Now consumers want their news for free, sales are down, and the newspaper industry – among other industries – is looking to pay its fixed costs with advertisement sales.
On the surface, one might not think that this is a big deal. At first, I thought that this could be a positive move for many industries that are trying to sustain themselves as business models are changing. But, as I was trying to read this article yesterday afternoon, I was so distracted by the multiple moving ads, that I couldn’t get through the article.
The ‘buzz’ of the ads caused me to abandon the content of the article all together and focus on the ads. That’s great for the advertisers, but not so great for the writers who hope to pass along a message, make a statement, or inform me of some important research. Further, my consumer experience, though seemingly free, is being shaped by the guys who can finance the ads.
As my mind started wheeling during this mid-afternoon confrontation, I wondered at what point will all our media experiences be shaped completely by advertisers, and will this compromise the consumer experience?
Don’t get me wrong, I’m not anti-advertisements (I have a degree in advertising after all), but look at it like this: if I am going to spend my Friday night picking at various hors d’oeuvres tables just so I can get a free meal, the quality of my meal is going to be seriously compromised as opposed to going out and buying the exact meal I want.
Online ad spending continues to drop as companies are still feeling the economic crunch, which also makes this business model a little shaky in tough economic times. Yet more and more companies are trying to make this a viable model – one which was meant to support industries, not sustain them.
It is good that various industries are trying to figure out new models that will sustain them and satisfy the consumer as well. But, the consumer should be willing to give a little bit too. After all there is a time and place for a free meal and a cheap car, but at what point is free really worth it?
