Paywalls are a short-term fix, not a long-term solution

emedia/vitals reporting:
Alan Mutter, in his Reflections of a Newsosaur blog, hones in on the real problem. It’s not that newspapers are placing their bets on digital advertising, he says, it’s that they’re betting on the wrong kinds of digital advertising: banner and classified advertising, two weak performers that are rapidly losing share to other types of digital ad spend, such as search and mobile. That’s why, Mutter notes, newspapers are losing more than $13 in print revenue for every $1 they gain in digital sales.
“Transactional search is a format where newspapers never invested and never have been able to compete,” Mutter writes. “By their inaction, publishers have been shut out of nearly half the digital market.”
He adds that publishers are compounding the error by missing the boat on mobile and video advertising:

“While the IAB reports that mobile advertising has doubled in each of the last three years, most newspapers have only rudimentary capabilities in this rapidly developing area. Publishers also are weak contenders in video, the next-biggest area of growth after mobile. The challenges will keep coming.”

The bottom line is that most if not all successful digital publishing models require a blend of advertising revenue and paid content. It’s problematic when experts like Starkman continue to look at the newspaper business through the prism of traditional publishing models. He implies that innovation isn’t a strategy, but innovation is exactly what newspaper (and magazine) publishers need. They can continue to put band-aids on their bleeding business models and outdated infrastructures, or they can spend more time experimenting with new ways to monetize their content and their audience, such as: ...
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