Waiting for the other shoe to drop in paid online news

Everyone is asking about the impact on the Wall Street Journal of the New York Times decision to release all its news and most of its archives from the bondage of paid access.
For those of you who may not have seen a copy, The New York Times is a newspaper that is popular with the elites in a couple of cities on the east coast of the United States. It is published by the same company that publishes NYTimes.com, one of the best and most-read news websites in the world.
The Journal’s decision is more complex. It has printing plants all over the world, so that it can deliver its print product first thing in the morning. Most of its readers are not buying the paper with their own money, so it’s not clear how elastic their demand really is. Or whether they’re actually reading it, I suppose.
The Journal is able to get absolutely premium rates for its print advertising because it has an absolutely premium audience who can buy and sell the kind of nerds who read the New York Times. Especially the Times’s Sunday readers — losers who like crossword puzzles, long magazine articles, and the latest news about Richard Wagner. The dynamic money-makers who read the Journal don’t have time for that nonsense. On Sunday mornings, they’re reading their Blackberries, shopping for summer homes, and waiting for markets to open somewhere.
Does the Journal really want to reach the kind of riff-raff who want to read the news for free? Those people don’t even aspire to owning a fine Swiss timekeeping instrument, let alone have half a dozen sitting in an automatic winder in their walk-in closet waiting for an appropriate occasion.
The answer, of course, is that the print edition of the Journal will fade away soon enough. Newsprint is getting more expensive. Printing plants are very expensive. And by the time you get it, the news in the paper is already beginning to rot on the page. And if Rupert Murdoch moves the paper to shorter, punchier stories, he’ll have created a made-for-online product.
If the Journal doesn’t come up with plan for a gentle transition to a free online service, that day may not come gently and it will be hastened by the likes of Bloomberg, Reuters, Conde Nast, a few hundred bloggers, and (yes!) The New York Times.
Originally published on my blog at JupiterResearch.