Felix Salmon Is Not Impressed With The Bloomberg Paywall

From Slate:

The Bloomberg Paywall Does Not Make Sense 
Save your $420 for some outlet that needs it.

In recent years, hundreds of publications have started putting up some version of an online paywall. Nearly all newspapers now have them; many magazines are following suit, including, most recently, Vanity Fair, where $20 per year will buy you “more breaking news, more in-depth reporting,” and—of course—a VF tote bag. In an age where the Google-Facebook duopoly is hoovering up the lion’s share of digital ad revenue, online publications need subscription money to survive and to pay their employees. At heart, the value proposition is simple: Pay us so that we can afford to continue to provide you with the journalism that the country needs. 

Now, however, Bloomberg is putting up a paywall, despite the fact that it can’t make the same claim. Bloomberg’s journalists are paid out of the billions of dollars that its company’s financial terminal business earns every year, at $20,000 per terminal per year. Bloomberg LP could shutter the entire website tomorrow, and its journalists and journalism would continue on the terminals; it’s certainly not facing an existential threat.

What’s more, Bloomberg’s eponymous owner, Michael Bloomberg, one of the world’s richest men, has never worried about the cost of journalism in the past. When he bought Businessweek in 2009, he was warned that the magazine would be a “millstone” that would lose him upward of $25 million per year. His legendary response: “Do I look like a guy worried about losing $25 million?” 

So why is the paywall going up? Partly because it can. Paywalls are so common nowadays that Bloomberg was effectively leaving money on the table by not having one. Like the good capitalists that they are, Bloomberg’s executives have decided to pick this low-hanging fruit. As a business decision, it’s a no-brainer.

Bloomberg LP could shutter the entire website tomorrow, and its journalists and journalism 

would continue on the terminals; it’s certainly not facing an existential threat.

But there’s something else going on here too, related to the way Bloomberg LP is structured. Alongside its incredibly lucrative terminal business, Bloomberg has a much smaller media business, which, as far as anybody can tell, has never made money. It was never really supposed to: Bloomberg Media, which includes the website Businessweek and a ludicrously expensive TV station, was designed to garner audience and influence for the brand, which would help Bloomberg’s journalists get scoops and ultimately drive terminal sales. The website was the most visible part of that strategy, but the financial black hole was always Bloomberg TV, a Mike Bloomberg pet project whose aggregate losses make Businessweek’s look like spare change lost down the back of the sofa....MORE