Digital Villain to the Rescue

Rupert Murdoch is nothing if not business savvy. Viewed by many over the years as a bully who puts the bottom line far ahead of any other consideration--including journalistic integrity--he has nonetheless earned the respect of even his enemies for an admirable ability to survive even the most threatening crises.

During the early 1990s, for example, he borrowed heavily against the future earnings of The Sun to keep a rapidly sinking (and taking in lots of water) News Corp afloat long enough to ride out the recession.

Now, in the midst of another, and possibly deeper, recession, News Corp has posted some of its worst losses in history, and Mr. Murdoch, according to a recent article in The Observer, is again ready to do what it takes to keep his interests afloat, and this time, he says, he will do so by restructuring his news business models to include charging for online news content, a move he says will go into effect by June 2010.

Invitation

Precisely how this is to be done the tale does not tell. Will The Times and The Wall Street Journal charge monthly or annual subscription fees? Will there be a per visit access? Your guess is as good as mine. But the important thing to consider that this strategy is not likely to succeed unless his major competitors follow suit, and quickly.

That is why, in my opinion, Mr. Murdoch announced this strategy ten months in advance: to give his competitors and his News Corp time to finalize plans and to coordinate a shift over to pay-for-news online business model.

Mistakes

Mr. Murdoch is capable of making mistakes--such as acquiring MySpace, just as Facebook exploded into capturing a much large audience--but they are few and far between.

Charging for news will be a mistake if News Corp tries to go it alone. My guess is that others, such as Los Angeles Times, who among others are already charging for news via amazon's Kindle, welcome this Murdochian move and will be all to glad to work out a joint strategy to charge for online news.

Villain to Hero

Should Mr. Murdoch succeed, he will in fact stand out as the rescuer of journalism as a trade, rather than the villain who puts the bottom line ahead of all else. An amazing turnabout.

In fact, his recent acquisition of The Wall Street Journal did not result in a cheapening of the journalism practiced by the paper, but rather quite the opposite has occurred, much to his detractors' consternation.

Survival

I've mentioned it before in this blog that digital news will only survive long-term, if an equitable pay-for-news model is developed. And it looks like we might be well on our way.