Wednesday, October 28, 2009

As Closes, Which Way To The Future?

Yesterday saw the sad announcement that, an independent Spanish web based news platform, was closing down after only 22 months of existence. Soitu was seen as an innovative development representing for many the future shape of information delivery on the internet. It established a sizeable readership in its brief existence, and went for an approach based around participation and sharing of technology and resources. The widgets I have used on this blog to report election results, and the software for the charts I have occasionally published all came via this site.

The problem was that Soitu was launched just a short time before the economic crisis started to bite. A site that delivered its content free of charge depended on income from advertising, and it is the collapse in such income that has provoked closures and sackings across the Spanish media in the last couple of years. There is currently no shortage of creative talent in the industry, but the model which allows that talent to be able to work on a sustainable basis doesn't seem to have been found yet. In hard times like the present, the publicity dependent business needs a friendly sugar daddy to keep it going. Soitu just had a bank, the BBVA, and it seems that they have now pulled the plug. Ironically, the same bank continues to advertise on the site with banners asking "¿Cuando quieres pagar? Tu decides".

With casino capitalism still being allowed to run rampant, we live in an age of constant economic instability and any business based on assumptions of good times can now find itself itself in trouble every 5 or 6 years as we lurch from bubble to bubble. The optimistic view would say that failures like that of Soitu are a necessary part of the process of establishing the future structure of information delivery. The problem is that current trends in the industry are in many ways leading to the sacrifice of quality in exchange for immediacy and volume of content. Legions of copy and paste merchants at work mean that it's possible for a story to appear in one site, and then echo around the others in no time - much of what passes as "news" being generated by trawling through what others have already published.

The widespread assumption is that media groups will need to start charging for content, but breaking the everything is free on internet habit is going to be even more difficult if the quality of the product being offered isn't worth the money. It's worth placing bets on who will be the first major media group in Spain to make a renewed push for a subscription based service for internet news delivery. Newspaper sales continue to decline in Spain almost wiithout exception, and all of the major media groups are having to rethink their business.

For some the solution is to widen the potential audience, and for Spanish media groups that means looking towards the American market. El Mundo, whose printed edition is now also called El, has opened an American section on its web site with news from the different countries. Whether this news is just rehashed coverage from the different media in South America is hard to tell. Meanwhile the owners of El País, Grupo Prisa, already have substantial business interests in South America and have now started investing in Hispanic media in the US as well. Expanding the target audience may help, but we will have to wait and see whether it's enough to make the difference.

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