The FT’s call for Vince Cable, the UK business secretary, to examine News Corporation’s bid to acquire the 60.9 per cent of British Sky Broadcasting it does not already own has attracted further attention to what has become a crucial media ownership issue.
Most general interest newspapers are struggling to find a way to make money online, and Mr Murdoch has started experimenting by making The Times and The Sunday Times subscription-only. News International is now trying to extend that status to The News of the World.
We don’t know how The Times and The Sunday Times are doing behind a paywall, but it seems to me unlikely that the News of the World, on its own, can successfully charge for its content in a world of free showbiz and celebrity news.
That is one point of the News Corp bid. If it takes 100 per cent ownership of BSkyB, it would then be free to adopt the Cablevision model of bundling online access to papers (in Cablevision’s case, the Long Island newspaper Newsday) with television subscriptions.
Many (perhaps most) general newspapers will struggle to charge online because they lack sufficient distinctive content to attract subscribers. Their prospects would be far better as part of a bundled multimedia news and entertainment package.
I have argued for some upmarket general newspapers, including The Guardian and The Times, to try to charge online because their long-term prospects of survival are slim without it (although I also think they need to specialise more to improve their chances).
But the Cablevision example suggests one alternative for newspapers that are too vulnerable on their own. By becoming part of larger media groups with a subscription base, they can adopt a consumer version of the Bloomberg or Thomson Reuters model.
Of course, such mergers would raise competition and cross-media ownership issues – which is where we came in.
