December 6th, 2007

The Future of Print Publishing and Paid Content


Print is dead and all content wants to be free — two bogeymen of the digital age, with some edge of truth, but based on current visibility, still unlikely at those extremes. But it’s undeniable that the economics of print publishing are very different today than what they were before the web, and more content is available for free on the web than any media company could ever have imagined.

Most of the discussion about the future of print publishing and paid content centers on the content, which makes sense, but the content hasn’t really changed that much (despite the emergence of some new forms) — nor do I think the value of content has changed in the minds of content consumers, e.g. people who value journalism still value it — their numbers haven’t diminished as so many fear.

What’s changed radically is the value of DISTRIBUTION.

For many people who paid for print publications, including newspapers, magazines, and books, a significant part of the value was in the distribution. That DOESN’T mean people don’t value the content anymore. It means that the value of having it delivered to their doorstep every morning, or having it show up in their mailbox, or carrying it with them on a plane — in print — has CHANGED because of the availability of digital distribution as an alternative.

The problem for people who sell printed content is that the value of the distribution and the value of the content itself was always deeply intertwined — now it’s separable.

People ARE willing to pay for certain digital content, but they AREN’T willing to pay for the distribution — specifically, not the analogue distribution premium. Tim O’Reilly has a fantastic piece on the economics of eBooks, in which he makes this fascinating observation:

And as for the kind of books that you don’t read from beginning to end, but just use to do a job like looking up information, or learning something new, the “all you can eat” subscription model may be more appropriate. With Safari, we’ve increasingly moved from a “bookshelf” model (in which you put books on a bookshelf and can only swap at month end) to an all you can eat model, because we’ve discovered that people consume about the same amount of content regardless of how much you make available. All you can eat pricing lets people take what they need from more books, but it doesn’t increase the total amount of content they consume. It merely changes the distribution, and in particular, favors the long tail over the head.

Instant full access to a searchable digital library is a radically different form of distribution from buying reference books one at a time and putting them on your bookshelf. But here’s the fascinating part — “it doesn’t increase the total amount of content they consume.” People still value and use the content in much the same way, despite the radically different distribution model. By unbundling these books into a digital library, consumers essentially repackage them by searching for and selecting specific content items.

So even when consumers value content enough to pay for it, they intuitively understand that it doesn’t cost the publisher nearly as much to make the content available digitally as it did to put all of those books physically on a shelf. That’s why consumers aren’t willing to pay for the equivalent of buying ALL the books in print. You can’t price a bus ticket the same as a plane ticket simply because they both get you from point A to point B — it costs a lot less to drive a bus than fly a plane.

This is why I disagree with Tim here (as he debates the findings of a consumer survey):

But Marie’s poll goes on to conclude that “over half of people surveyed expected e-book prices to be $5 or less and 1 out of every 5 expected the price to be $2.50 or less.” She says:

We believe that the Publishing Industry will very quickly discover that they’re blessed with ELASTICITY. That is, the lower the prices of e-books up to a point, the more net revenue they drive (thus the cannibalization effect on traditional book sales will be overcome). E-books may start around $10.00 each, but come down in the 2008-09 timeframe and approach $5.00.

It’s true that new price points can sometimes attract new readers — that’s what happened with the rise of the paperback. But note that as paperbacks became the dominant format, outselling hardbacks, prices rose substantially for both paperbacks AND hardbacks. They didn’t keep falling. So if prices fall to $5 or less, as predicted, you can equally bet that they will rise if and when the electronic format becomes dominant.

The problem with the comparison between paperbacks and ebooks, is that while the average person could tell you that printing and distribution for a paperback is cheaper than for a hardcover, they could also tell you that “printing” and distribution for an ebook is A LOT cheaper than for either a paperback or a hardcover. When paperback and hardcover prices rebounded, it was because consumers were still willing to pay a premium for both forms of distribution.

To find the right price for ebooks, publishers need to FORGET the value of distribution in the traditional print model. There’s only one question — what is the CONTENT worth? (Even the ability to search an entire library can’t be valued — Google has commoditized it.)

I’m of course making an assumption that widespread digital distribution will do the same thing to books as it has to newspapers and music — but no type of content, despite the differences, has proven immune to the effects of digitization. The easy and frictionless microchunking of digital content — an article, a song, a book chapter, a clip — will continue to redefine production and distribution of content. Books are not immune. (Neither are movies, but that’s another topic.)

So does that mean there’s no value left in print distribution, be it a book, a newspaper, or a magzine? NO.

Print publishing won’t be dead until the people who value print distribution are dead — and that’s going to take at least a generation. People will still pay for print publications when they DO value the print distribution, e.g. the newspaper on the doorstep, the book or magazine in your bag on the plane or at the beach.

But the reality that print publishers need to face is that the number of people who value print publishing will continue its long, slow decline, as the digital generation grows up. That means print publishers need to completely re-evaluate the economics of their print publishing operations according to a 50% rule, which means asking:

What if the number of people who value my print distribution dropped by 50%?

How could I make the economics work? Could we produce the print product for less? Could we charge the remaining subscribers more because they clearly value it more?

That’s what Derek Powazek is attempting to find out with his recently resurrected publication Fray, dedicated to personal storytelling (Fray has a long and “storied” history online). Derek has taken the radical step of taking an online publication and turning it into a quarterly print publication.

FRAY BEGAN as a website. We presented individually designed, true first-person stories. Each one ended with a question that prompted the audience to tell their stories, too. You can see an archive here.

THEN IT EVOLVED into a series of live storytelling events, Fray Days and Fray Cafes, that took place all over the world, attended by thousands of people. You can see some photos and listen to audio of those events, too.

AND NOW Fray is evolving again – this time into a quarterly series of independently produced books. Each one will be on a central storytelling theme, and include personal stories, articles, and original art. They will come out quarterly. They will be awesome.

But even more radical is that he’s making a Radiohead-like move and asking subscribers to pay for it based on how much they value it.

Fray is supported by our subscribers, so thanks for considering it. We’re super-passionate about creating beautiful books you’ll treasure, so we have this guarantee: If you’re not happy, you can cancel and get a full refund at any time.

There are four subscription levels to choose from. Shipping is calculated on the next page.

The Toe-Dipper

Just want to check out a single issue? No problem. The Toe-Dipper includes one copy of Issue 1 with no further obligation.

The Subscriber

This is our basic subscription. The Subscriber includes four issues, starting with number 1, which will come over the next year. It’s four issues for the price of three!

The Friend of Fray

Show your support of Fray and we’ll shower you with goodies! The Friend of Fray gets four issues over the next year, plus great limited edition gifts (special books, stickers, t-shirts, prints, and whatever else we can think of). Friends of Fray also get in free to any live Fray events.

The Full Kringle

Share the love! The Full Kringle comes with one Friend of Fray subscription for you, and two basic subscriptions for you to give to friends. That’s three issues, four times a year, plus goodies and free events for you!

Derek observes why this in an experiment in the pure valuation of print content:

The internet allows consumers and creators to connect directly. So for the first time, it’s possible to skip those middlemen. Putting ink to paper is always going to be more costly than putting pixels to screen, but now that a group of talented people can collaborate, create, and sell directly to consumers, it’s actually possible to jump the middlemen – a community can support its own content creation.

I recall at Jeff Jarvis’ Networked Journalism Summit last October, John Wilpers of BostonNow, was on one of the panels. BostonNow is a “free daily newspaper incorporating both traditional and citizen journalism.” One of John’s comments really stuck with me. He said that what the “citizen journalist” contributors valued most was getting publish in the PRINT newspaper.

Imagine, the revolution is enabled by digital technology, but the revolutionaries just want to see themselves in good old-fashioned print.

What if a local newspaper used its web presence to give everyone in a locality the opportunity to be published in print, even just once? Just a short piece of reporting, perhaps partnering with a professional journalist. Imagine if even 1% of the people in a local market got something published in the print paper across a year or two. How might that change how people in that market value the print newspaper? Would they be willing to pay a bit more for a subscription? Would they be more inclined to consider the print paper for their classifieds?

I don’t know if that’s a good idea. I’m just making it up. But that’s the point.

Print publishing is not dead. Neither is paid content. But both need to be entirely reinvented for the digital age.

Comments (17 Responses so far)

  1. Again, Scott, you synthesize brilliantly a number of diverging topics….and best of all? Your insights are 100% free.

    In the book “Made to Stick” there is a chapter on a local newspaper that has over 112% community penetration.n. The reason? NAMES NAMES NAMES. The paper does an incredible job of keeping a laser beam focus on LOCAL activities and all the PEOPLE that are apart of these events.

    In much the same way, I have established my magazine – we are now global with correspondents covering a vast part of the planet. We also feature over 70 short stories in the first 8 pages of the magazine about new companies, new products and events.

    However, there is one thing my magazine has done that takes things a step further. We have decided to make it an item of value that we want our readership to keep. We don’t scrimp on the phyisical production cost and we are very careful about the types of advertising we accept.

    It makes for a very unique package that appeals to a certain segment. Then again, we don’t have the typical overheads that most magazines have….but that’s story for another post.

    Thanks Scott! Terrific read!

  2. [...] The Future of Print Publishing and Paid Content. Scott Karp, the short version: print is not dead, paid content is not dead, but delivery has changed forever, and so have the ideas about value [...]

  3. [...] pointed me at a fascinating article by Scott Karp speculating on the future of (and the future prices of) print and digital content. There are a [...]

  4. You know, I see a bit of a parallel between the emergeance of portable video and E-books or electronic documents. I read an article a number of months ago that talked about a change in viewing habits developing with today’s teenagers and 20-somethings (the Millenials, I guess).

    The generations preceeding the Millenials are used to seeing video on something the size of a TV screen or a movie screen. Now you’ve got a new generation that’s getting used to watching video on a screen that’s the size of a Zippo lighter – namely, the Video iPod. Portable DVD players have relatively small screens, as do most notebook PCs. We used to take for granted that video was supposed to be (or seem) larger than life.

    Documents have thousands of years of history as physical objects that could be picked up and “paged” through. It’s hard to fit an entire page of a document on a PC screen. Scratch that: it’s easy to fit an entire document page on a screen… but most of the time the print is so small that it’s unreadable. Electronic documents are going to have to fight that battle in order to replace paper. Until we have a viable unit that’s portable, yet able to allow a viewing screen the size of a sheet of 8×11 or A4 paper, I don’t think paper will completely disappear.

  5. [...] The Future of Print Publishing and Paid Content – Publishing 2.0 Eine Schlagzeile, die viel viel für sich beansprucht. Aber das auch hält. (tags: #forthesis publishing paidcontent) [...]

  6. [...] The future of print publishing and paid content | Publishing 2.0 Quote – Print publishing is not dead. Neither is paid content. But both need to be entirely reinvented for the digital age. (tags: books ebooks print newspapers publishing magazines) SHARETHIS.addEntry({ title: “links for 2007-12-07″, url: “” }); permalink | categories: All other | Time posted: 11:22 pm on Thursday, December 6th, 2007 [...]

  7. [...] The Future of Print Publishing and Paid Content – Publishing 2.0 (tags: csm buildtheecho business_models) Share and Enjoy: These icons link to social bookmarking sites where readers can share and discover new web pages. [...]

  8. Also at the Summit was Dan Pacheco from the Northwest Voice. As you remember – I did write-ups (quick interviews) with lots of the participants: Dan’s wording was different but he also explained that what motivated people to buy Northwest Voice was to see their stories (and their neighbors stories) in old-fashioned print.

  9. [...] Scott Karp at Publishing 2.0 has a nice piece on value of print in the changing environment. Here [...]

  10. [...] The future of print publishing and paid content [...]

  11. [...] 2.0’s low relevance to Digg’s audience and vice versa. I wrote a post about the future of print publishing and paid content, which was linked to and discussed by other bloggers who cover this top. The post was submitted to [...]

  12. A couple of late notes directed at the author:

    I know an O’Reilly author, and I can tell you Tim O, while widely acknowledged to be a smart fella, doesn’t understand digital distribution at all. I guess that he just has too much investment in making ( admittedly great) computer books to learn a new bag of tricks. Safari bombed to start with, and has not taken off. The subscription model just didn’t work. or, it was too expensive.

    The other factor attacking paper publishing and especially newspapers is the environmental cost. Just as its ridiculous to ship bottles of tap water by truck, its wildly inefficient to make paper-> print and distribute copy->pickup and recycle paper just to get digital data from the reporter’s laptop to mine.

    I still pay for my morning newspaper, and many magazines, but I have already dropped some subscriptions down to on-line only. It’s easy for me to see publishers abandoning printing of their ephemeral copy, just as soon as the reader tech is good enough, or the carbon-footprint costs get too high.

  13. Most of the publishers are focused on digitization in order to increase their circulations. In this digital age, most of the people are looking for digital editions of print publications. I saw recently a website provides the digital versions for print publications like news papers, books, magazines, journals, etc. Most of the publishers are using services.

  14. [...] Honestly, I don’t see a future for print news AT ALL! I mean, how can print news have a future when top-notch news anchors are losing their jobs because of online journalism? (Paul Douglas just recently got fired, if you haven’t heard.) News anchors, who get paid millions, are losing their jobs: but news print will still continue on, right? WRONG! Print news will be squandered, just as well-known T.V. anchors are being squandered – the jobs of news anchors and print news does not have a bright future. Scott Karp of Digital 2.0 agrees. See what he has to say! [...]

  15. [...] Scott Karp observes on O’Reilly’s comments in his blog post on The Future of Print Publishing and Paid Content (6th December 2007) on Publishing 2.0, “Instant full access to a searchable digital library is a [...]

  16. [...] Publishing also addresses this same issue, and an interesting concept was raised. The writer claims that it’s because of how print is distributed now that is one of the key factors of why print is “dying”. That we would much rather read electronically, rather then on pages. But what can be more impersonal and cold then reading a great novel or story on a laptop. Do people still not enjoy curling up with a book on a cold night, wrapping themselves in blankets and endless pages? [...]

  17. [...] you are looking to save the printing industry, look elsewhere.  If you are looking to start a company that takes the current printing industry and moves it [...]

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