Warren Buffet is one of the most renowned investors in U.S. and he has a knack of staying in the news. Now, his firm Berkshire Hathaway has purchased 26 local papers. Speaking about this acquisition, Buffer wrote to publishers that these local papers need to focus on local news and shouldn’t try to complete nationally.
One of the most important things that Buffet included in this letter to the publishers was his views regarding online news. According to him, the model of free online news was turning out to be unsustainable and that sooner or later, those who want to make money out of news will have to move to a paywall-like model.
He wrote, “We must rethink the industry’s initial response to the Internet. The original instinct of newspapers then was to offer free in digital form what they were charging for in print. This is an unsustainable model and certain of our papers are already making progress in moving to something that makes more sense. We want your best thinking as we work out the blend of digital and print that will attract both the audience and the revenue we need.”
This may mean that Buffet fully supports a paywall model, which has already been adopted by some industry giants such as New York Times and New Yorker. In a paywall model, some of the features are available for free to all users whereas another set of features are available exclusively to such users who pay a small annual or monthly premium. This helps the company sustain itself and make adequate money to carry on.
The news industry has suffered a lot due to the technological evolution in that its profits have been substantially cut when moving from print to digital realms. And it is still trying to cope with it, trying to find a model which will help it gain back its profits.
Courtesy: The Verge