Interview: Former WSJ publisher Gordon Crovitz on paying for online news

How does a publisher build an audience while charging that audience?

Scott Fulton, Betanews: I know your partner, Steven Brill, last November presented a memo to The New York Times, in support of going to an online subscription model...Mr. Brill's comment to the Times was essentially, "You've already done Step 1, you've built an audience. Now it's time to do Step 2, to monetize that audience." That seemed to suggest to me that the business model for online news, as presented at least to the Times, is first to build an audience, and then to charge it. Well, isn't that a little counter-productive? That seems to say to me that the only way to build an audience is to give away your product? I would think that you'd want to start selling...

Gordon Crovitz, JournalismOnline.com: [I think the model Steven suggested] was quite constructive. The launch of the online Journal was presented as free, but there would be a subscription paid. Large audiences gathered, and over time, subscribers were much larger than the number of people who had accessed it for free.

Scott Fulton: I want to cite a paragraph you wrote for a column in the Journal last February: "For years, publishers and editors have asked the wrong question: Will people pay to access my newspaper content on the Web? The right question is: What kind of journalism can my staff produce that is different and valuable enough that people will pay for it online?"

When you were working more directly with Dow Jones, you were the founder of Factiva, [a subscription-only custom business news service]. And that would be an answer to that second question, but it's also an obvious customer-driven, very customer-centric service that produces superior news quality on request for individual customers. Does a news producer, in order to meet the criteria suggested by your second question, the "Right Question," have to be capable of being a Dow Jones, of being a Factiva -- that your staff must produce distinct quality?

Gordon Crovitz: No, no, no. I think every news brand has got its own brand attributes, and there are certain things that its reader expects of it. It might be local news, it might be sports news, it might be some other kind of news. So I think that most, maybe all news publishers, for some fraction of the audience -- I'm not saying for everyone, but for some fraction of their audience -- they will have the ability to craft services that some percentage of their unique visitors will access.

I find that a lot of news publishers don't track this, but what we expect will be the case is that news publishers will continue to provide a lot of content services without a fee. The opportunity is for some percentage of the unique visitors from us to generate subscription revenue. So the online Journal may be indicative, anyway -- there are 20 million monthly unique visitors to the online Journal, 1.1 million are paying subscribers. So about five percent of the total. So if people think of the online Journal as everything behind a paid wall, that's not accurate. It's very much a hybrid model, and I would expect that those publishers would pursue that kind of hybrid model.

[ME's NOTE: In our story last week on the founding of JournalismOnline.com, I inadvertently transposed a few words and never caught myself in the copy edit. So for a while, I stated that Mr. Crovitz had announced his intentions to make The Wall Street Journal online free, when the word I meant to include was Murdoch, as in Crovitz' new boss at the time, Rupert Murdoch. My guest copy editor who finally located my error was one L. Gordon Crovitz, whom I thank very sincerely and to whom I also apologize for the transposition.]