Wednesday, January 07, 2009

The NYT and the Information Theory of the Leisure Class, Part 3/4

(Third part of a long essay posted here in four parts, on the New York Times and its business model, such as it is.)


Opinionification = commodification

So what? Well, this goes a long way to explaining the Judith Warner phenomenon at the Times. Warner is one of the new breed of online blogger-writers at the legacy media. John Podhoretz calls her America’s “most embarrassing online columnist,” purveyor of inanities we might charitably call mommy-feminism-lite. But reaching deep inside yourself to access your Warner-nature as a source of public authority, it turns out, requires little to no factual or reportorial effort; she is, therefore, in the Times’s new business model, remarkably productive. More productive, alas, than David Carr – because what she (re-)produces is group, indeed class, solidarity. The Times as though transformed into a string of middle-school mean-girl text-messages to Warner’s nationwide posse: a nearly flawless harbinger of what the economics of “$20 for each 1,000 customers” brings. Does the Times pay her? Why? The problem beyond Warner, however, is that “embarrassing” and “online columnist” are something of a redundancy (let’s be honest) even for a Web enthusiast like me who understands fully and celebrates how the Internet has managed partly to pry open the oligopoly of the MSM.

Facts are expensive; opinion cheap. And confirmation-bias-cocooning – cheapest of all. But newspapers made a fatal mistake deciding their competitive advantage lay somewhere other than facts. Facts not easily available, facts not already priced into the information stream. Once facts are out there enough to be part of the opinion stream, they have already been discounted to near zero and priced accordingly. No one will pay for them at that point. Developing new facts is expensive. If it weren’t, it wouldn’t likely add value in what is a surprisingly efficient information market – at least in that part of the information market in which people care about accuracy.

You do have to figure out what kinds of facts people will pay for, true. But you don’t remain profitable going after the least-value-added line of business available. And, worse, you don’t remain profitable trying to compete with people willing to do it for free in an environment of zero barriers to entry. Opinionification is commodification. And commodity pricing will not pay the rent in Manhattan.

Anyhow, the idea that newspapers would have a competitive advantage on the Internet merely in offering opinions was always complete madness. More precisely, it was always completely ego-driven madness. Do the “professionals” have an advantage in writing quality, and does the reading market actually value that edge? I understand the pain and wonderment of the newspaper reporter who, after toiling in mere facts for decades, finally ascends to a column on the opinion page; you have to believe that the opinion-columnist is a higher calling, or requires greater experience, expertise, skill, writing ability, something. Whereas facts, new facts, relevant new facts – those are premium priced, while even extremely skilled opinion writing is today, on the web, a mere commodity, priced as such. The sad truth is that the vaunted columnists of the Times and elsewhere are lucky to have ascended to their opinionating posts – because there are any number of writers as good as they, as prose stylists and thinkers, and experts too, who do it for free because, after all, their day job is … lawyer.

But at least the folks on the opinion page are on the opinion page. The issue is not the Times’s opinions, it is that the Times’s news pages assert its opinions as facts. And then (mirabile dictu) it seeks to price those opinions as facts. This is, in effect, the Times’s way out of the trap of commodity pricing: re-brand your apparently not-so-valuable commodity into a ‘luxury good’ and then sell it at a premium price. Talk about chutzpah.

This puts us squarely in the land of Thorstein Veblen. It puts us squarely in the land of The Theory of the Leisure Class. Conspicuous consumption, and the pricing of luxury and prestige goods as an exception to the usual rules of supply and demand. The Times’s core subscribers (which is to say, its core confirmation-bias readers) follow a Veblenesque “prestige goods” pricing model. They are thus – or so the Times must hope – more willing to pay higher prices for the Times’s opinions-asserted-as-facts, in no small part because having paid higher prices is a social signal that they must be … true. Or, if not true, then at least a sign of sophistication, sophisticated consumption which, after all, is more important than truth. Indeed, the more heavy-handed the cramdown of political opinion, the happier this readership is. It is ideological satisfaction that the Times must hope will somehow, some way, translate into greater reader loyalty and the willingness to pay above-market prices for mere opinion.

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