On Tuesday, GigaOM’s Mathew Ingram wrote about “why the NYT-Flipboard deal is a smart move.” To summarize, Ingram believes that the deal is an important step for the Times towards adapting to digital content distribution. Flipboard is a news aggregating service, and before striking the deal the Times found that 20% of its digital subscribers use similar aggregation platforms. As Ingram titles one of his article’s subheadings, “people discover content differently now.” Clearly, the Times needs to distribute its content across third-party apps and reading platforms in order to capture lost revenue and potential readers. Furthermore, the deal with Flipboard allows the Times to better understand how content discovery unfolds in third-party spaces. Yet, I am skeptical that the deal heralds a radical transformation of the Times’s distribution and consumption structures, especially because the Times has yet to figure out, in any meaningful way, how to keep subscribers in and moochers out.
To access Times content now as a non-subscriber, you can just browse through the Times website, copying and pasting interesting headlines into a Google search. Since the Times does not keep click-through traffic out, you can access almost all the Times content you want by spending an extra 20 seconds per article to navigate through this gaping hole in the paywall hull. The main problem is that the Times website is completely open to traffic, whereas the article content itself isn’t—which allows malfeasant users (myself coughcough) to identify desired content and then exploit the hole. Surely, the Times has conducted extensive research on its paywall/website interfaces and understands best how to optimize revenue. Nevertheless, it seems as though there must be a better way to regulate content access and to incentivize subscription. In fact, if I could not conduct my very brief evasion tactic, I would definitely subscribe, because I like reading the Times enough to pay the nominal fee. But the hassle of signing up combined with the monetary cost of a subscription make my maneuver worth it. The Economist is an example of how you can make a digital subscription system profitable. Of course, The Economist produces content of a very different source from the Times, even heavier on analysis, anonymous, and skewed towards a particular and somewhat bounded audience. Fundamentally, The Economist is a magazine, and it remains unproven whether newspapers can implement digital subscription models successfully. I would contend that the Times has not.
Therefore, the NYT-Flipboard deal is an interesting but not especially revolutionary development in the history of digital newspapers. The deal demonstrates how newspaper companies are being forced to adapt, at least on a constrained scale; however, it does not indicate a sudden shift in direction, a 180 wherein the Times embraces alternative revenue models than a paywall. Ultimately, the problem is that the Times is not innovating independently, but rather responding to offsite innovation. No wonder it looks like newspapers are playing catch-up: there’s no native innovation to speak of. If the Times produced an alternative, competitive reading platform to news aggregators, or worked to radically democratize content distribution—beyond the pseudo-democratization that revenue-gobbling titans advance as an illusory “value”—they could avoid having to fit their old-fashioned newsprint into incompatible, newfangled formats.