There is little more urgent on the Internet than fixing the web advertising model.
The New York Times is on the verge of going out of business. This is a business with a great and beloved product. And while the economy is indeed tanking, failure of newspapers is not about macroeconomic issues. The Times’ issues are specific to the newspaper industry. The problem is that while The New York Times still has a healthy readership, their readers are moving to the web version of the paper, where newspapers currently can’t make money.
While search based advertising is doing well, display based web advertising on which all newspapers depend, is broken. Actually, that is incorrect. It never really worked, though for some time we deluded ourselves into thinking that it did. The problem is that now, with a failing economy, people are no longer willing to look the other way.
As, Internet observers, we continue to attack newspapers and suggest derisively that they need to “figure out a business model that works.” The problem is that the critique is really aimed in the wrong direction. Of course I guess you could suggest that it is the newspaper industry’s problem since they are the ones about to go out of business, but this issue is far bigger than just newspapers.
The Internet industry has not figured out a viable way to monetize the kind of work that the New York Times does. The browser, in its current form, is an ineffective environment for exploiting non-search advertising. This is problematic because the information media business is incredibly valuable to our culture and entirely dependent on such advertising.
The kind of value that the New York Times creates cannot be produced by user generated content sites like Digg, manual aggregators like Drudge, or small time bloggers. These low cost information purveyors stand on the shoulders of very expensive giants. Like leeches, they attach themselves to, and live off the work of their much larger hosts. In general they leverage and expand upon the vital work the major outlets do, but they rarely act as original sources.
Organizations like the New York Times do real research, rigorous, editing and investigative reporting. That is not to say that they always get it right. But theirs is work that must be done. Real reporting is hard work and it needs to pay a decent wage and stay in business.
And there’s the rub. The media’s advertising based business model is broken on the web, and so the businesses that employ real reporters can’t afford to pay decent wages.
This is a crisis. If the New York Times and other major newspapers go out of business, our culture is in grave danger. We will be watching as a huge part of who we are disappears right before our very eyes.
And so, The New York Times does not have a problem, *we* have a problem. The Times is just the canary in the coalmine for this much larger and more important issue of fixing our tools. This is a problem for the technology industry to solve, and fast. Expecting The New York Times, or any newspaper to solve it is about as reasonable as expecting them to create the next great operating system. They just don’t have that kind of DNA, and we shouldn’t wait around expecting them to develop it.
The core of the problem is that advertising can’t be placed alongside content in a substantively profitable way on the web. It doesn’t work. Or at least, it doesn’t work well enough to pay for content that is expensive to create.
In printed publications, the reader’s eye wanders. A full broadsheet can be fully scanned in a second or two. The reader can focus on ads or headlines that catch her attention. Ads are scattered randomly throughout the content, and so the eye trips over things it might not otherwise see.
On the other hand, Internet advertising is structured in such a way that you know exactly where not to look to avoid it, i.e. across the top and down the side of any web page. And on the web, there is no such thing as scanning a massive page of content to find things of interest as we do with a real paper. Browsing on the Internet is like walking down the street with massive blinders on. You can’t get the kind of super-fast overview that newspaper reading affords, meaning that comfortable serendipitous discovery is much less likely.
The bottom line: display ads on the web are almost totally ignored.
As I have already stated, this is not a problem we can expect the newspaper industry to resolve, but I do believe it is eminently resolvable. And while there are many groups that could develop viable solutions, there is only one that I think has the focus and the sufficient interest in these sorts or issues to resolve them, and that is Mozilla.
As I see it, Mozilla has the right kind of people, the right mandate, and a parochial concern for the well being of the web that makes them the ideal organization to work on fixing this problem. It seems to me we need a next generation browser that allows for much easier scanning and browsing. Just as my eye can zoom in or out on a physical page, and just as I can, in a quarter of a second look at a bunch of articles on a page, so too should such things be possible in the browser.
My browsing experience should be as fast and effective as is reading a real physical newspaper. Today, browsing a paper on the web is nowhere near as fast and fun as doing the same in the real world, but I am confident that, with the right focus, we can do much better. And a side effect of such improvements could very well be the saving of the newspaper business.
Of course other companies beyond Mozilla could step up, but, for a variety of reasons, this seems unlikely. And if no one does anything, in the next 24 months, a huge and important piece of our social structure and system of governance will entirely disappear.
And so, while one may think of this as being an alarmist piece about saving the wealthy scion’s of the newspaper industry, I assure you I have no such narrow concerns. As I see it, saving the newspaper business should be viewed by all of us as a purely selfish act. We cannot afford to lose the valuable service that newspapers provide, and so saving them is entirely about saving ourselves.