1) For newspapers, the paid model doesn’t work -
http://www.niemanlab.org/2009/04/paying-for-online-news-sorr...
http://opinionator.blogs.nytimes.com/2009/02/06/micropayment...
The basic idea is that people will find the news for free. Newspapers can wall the content behind subscriptions all they want, but that will only result in bloggers/aggregators getting subscriptions, rewording and summarising the articles and posting them on their own sites without any attribution whatsoever. The WSJ is the perfect example - their subscriptions are going down primarily because readers are getting the same news from other sources, who are most probably rehashing the WSJ after getting a subscription. Entire teams will spring up EXPRESSLY to make sure they dodge copyright infringements. It can’t be stopped.

2) The quality vs speed argument doesn’t work either. "The blogs have speed, you have quality and, given what they’ve had to put up with all week, that’s something your readers will be more than willing to pay for" - that’s a monstrously large assumption. If anything, it’s becoming more and more evident that people care a lot more about getting bite sized ‘gists’ of breaking stories rather than in-depth page long columns. True, there are a small chunk of people who would be willing to pay for this but it’s most certainly nowhere near the number it would take for the papers to earn as much as they make today. The perfect example is the Economist - it’s profitable BECAUSE of it’s small size. The NYTimes is simply too big to follow their model, since they would need multiple magnitudes of order higher in the number of subscribers to turn the same rate of profit. If the NYTimes is willing to cut down to the size of the Economist, then they MAY make a profit.

3) Weekly news updates - if the questions is whether newspapers should adopt a subscription policy, I don't see why they can't stay as dailies. The speed at which they publish currently doesn't really sacrifice their accuracy all that much.

When it comes to monetization, webapps like xobni and basecamp can charge monthly subscriptions. But news outlets can't. If they have news that's exclusive, then yes, they can charge monthly fees. But with the evolution of the internet as it is, nothing stays exclusive for more than 14 seconds. It'd be far better for them to stay open and enable other sites to send them free traffic. This way, they can focus their energies towards making ad revenue from the increase in traffic.

The equation is simple: more traffic = more revenue. The problem right now is they don't have enough traffic. They could be doing MUCH better. The question is - how?

I propose a 'Site Network' solution. Brands like Techcrunch and Gawker have proven that a NETWORK of sites, alongwith a dedicated effort to push the headlines in front of readers (via search engines, social media etc) is the way to raise ad revenue. I have always wondered why the NYTimes would be boneheaded enough to publish everything on ONE site. Any succcessful site (success here measured in terms of ad profit) will show you that content belongs in its own niche.

Here’s an experiment, step by step -

1) the NYTimes breaks into 100 sites (or blogs), each with a specific name and topic, from tech startups to cooking to sports etc. Journalists will now see their articles on their respective sites. For example, the freakonomics section on NYTimes will now be a website called freakonomics.com. (All the individual sites will carry a NYTimes 'brand')

2) Instead of all articles being published on subsections within ONE site (like they are now), the same exact news is published across 100 different sites, in their respective niches. For example, freakonomics articles will be published on freakonomics.com instead of http://freakonomics.blogs.nytimes.com/ . The news is the same - it’s just the format that changes.

3) Dedicated SEO/SMO teams whose sole job is to constantly drive eyeballs to these 100 sites. The key is assigning teams PER site whose sole job is the growth of that individual site - ranking in google SERPs, maintaining popular twitter/facebook profiles, getting readers to blog, reblog, tweet, retweet and ultimately direct traffic to the site.

4) The individual sites will serve as cross-promoters to each other and serve a symbiotic network.

5) The NYTimes homepage can host the stories urgent enough to be on the homepage, but more importantly, it’ll serve as the portal which directs viewers to these 100 sites.

6) At the same time, strict guidelines on what is acceptable for 'quoted content' should be established, followed and enforced.

7) Monetize the increase in traffic.

The fundamental problem with subscriptions is this - people won’t pay. Correction, not ENOUGH people will pay. The idea of walling off content so that people will be forced to pay is a fallacy. This will only fuel the free sites’ drive to replace the newspapers by ripping off those very same newspapers. I dread that day.

P.S. I mentioned this idea to Paul on his blog and he raised a concern - "I guess my main worry would be that by creating sites so explicitly to allow SEO, the balance between editorial and advertising (which is to say journalists being encouraged to write about certain topics, or use keywords) could be slowly eroded."
My contention is that as long as a newspaper's current policy of separating journalists from the website is continued, there's no problem. As of now, besides submitting their articles, journalists have no input on the site’s look, feel, ads, links, fonts etc. The new sites will simply continue this this policy. Journalists would write and submit their articles and from there onwards, it's the job of the 'online teams' to publish and push the headlines in front of as many people as possible. Finally, it's the job of the editor to make sure that the qualities of investigative journalism aren't compromised for ad dollars.

Whew! That was a mouthful.