Now comes word that thanks to the General McChrystal story, Rolling Stone sold at least 5 times the number of copies it normally sells even though it's available for free online at Time.com and Politico.com.
That's the reason why it's too early to give up on legacy media formats like CDs, newspapers and magazines. Consumers will never buy these in the amounts they previously have (other than an exception here or there), but they will buy them under the right circumstances, like the McChrystal Rolling Stone issue.
What's needed is a reset in thinking. If you think that you'll make the same kind of big bucks that were once made in those businesses, you're living on a false hope. If you think that you can make a business of it with more modest expectations, maybe you've got a chance. The strategy is to keep the costs as low as possible in order to be able to give some away, use it as promotion, and make it up on the subsequent and ancillary sales. That's what the record industry has done since the 30's with radio. Of course, you still need a product that people want in the first place.
Actually, magazines and newspapers have a much greater chance of surviving than CDs, which is a format that will die a lot sooner. Newspaper subscriptions aren't falling at the levels they once were. In fact, a few are even increasing, and people read the newspaper much more in Europe than they do here. If we should ever have a prolonged Internet outage for any reason, newspaper readership and subscriptions would shoot up overnight. Plus, the most in-depth and competent news reporting still comes from the major dailies.
E-readers like the iPad could soon mean a revival for magazines, providing they adapt to the format and charge a reasonable price. And certain high-end specialty magazines still do well.
Regardless, the basic premise still stands. In today's brave new world, the more you give it away online, the more you sell
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