Why online journals haven’t made a dint … yet

Financial models aren’t the only problems for online publishing. Marshall McLuhan divided media into hot and cold – the more attention the medium demanded from its user, the hotter it was. TV was hot, radio cold. Of all the media, Internet is hottest. Not only do you have to sit down to read it, but unlike radio or TV, it is interactive. Also unlike radio or TV it is a one-on-one experience: one user per screen. The intensity of the experience implies that fewer people will use it for smaller period of time than other media, meaning a smaller audience measured in hours per person per day.

There is another limiting factor for ’net-based publications – their lack of portability. You can’t take them on the train or read them in bed. Again, maybe Salon is showing the way here. As part of their subscriber service (only $30 US per year) you are given the right to download and print-off a version of Salon that you can take with you. One future for the internet based publication may be as a hard copy publication distributed via telephone wires.

However, while independent overseas Internet journals are starting to make it, the future is much less certain in Australia. The first problem is the size of the market. Let us assume that Salon’s 35,000 subscribers come solely from the US and then multiply it by 19 million (the population of Australia) and divide by 280 million (the population of the US). That yields an Australian equivalent figure of 2,375 subscribers, just less than the number of subscribers Stephen Mayne claims for Crikey!. But Mayne’s $108,000 a year is not enough to sustain his one-man show, let alone pay his contributors and produce a return on capital. Salon, on the other hand, with similar market penetration, has the funds to hire columnists and commentators like Camille Paglia, Arianna Huffington and David Horowitz. What market penetration would an Aussie eJournal have to achieve to be able to afford to hire talent like that, and make a profit?

Another problem is the lack of an entrepreneurial culture in Australia or entrepreneurs with significantly deep pockets. Who is going to throw millions of dollars into an Internet product that may rack up tens of millions of losses for years before becoming profitable? Perhaps Kerry Packer at the height of the tech boom might have been prepared, but then that would just be surrender to the old media.

There will be solutions to the economic puzzle of Internet publishing and in some ways the experiences of Crikey!, Zeitgeist Gazette and OLO are more significant than that of Salon or TheStreet.com because there are many more national markets with populations of 20 million than there are with populations of 280 million. The steeper challengers that we face are therefore more typical for the world. The internet is a beautiful, supple medium for news, current affairs and opinion. By paying closer attention to readers’ needs independent North American publications are starting to make it. Australian ones must do the same.