David Prosser: Free speech will come at a price

Outlook When Rupert Murdoch announced a fortnight ago that News International would no longer countenance giving away free content, no one imagined he was intending to act so quickly – or that his first move would be in print, rather than online. Still, the closure of The London Paper reflects the same market pressures that have led Murdoch and son James to conclude they must find a way to make online media pay.

This is a title that lost almost £13m in the year to the end of June 2008, the last period for which accounts have been published, despite a circulation of getting on for half a million. Since then, the advertising market, a freesheet's only source of revenue, has deteriorated sharply. No wonder the Murdochs say the paper has "fallen short of expectations".

Indeed, the surprise with The London Paper is that it has survived this long, especially as the title was launched for no real commercial reason other than to get up the noses of Daily Mail & General Trust, owner of Metro and London Lite.

Still, the read-across to online is an interesting one. With no specialist content or added value and a direct rival that is free, The London Paper could never have become a paid-for title. The websites of News International's national newspapers are of a higher quality, but they also have a much greater number of free rivals, many of which are of a similar standard. So why is the company so convinced it can introduce a paid-for model at its online freesheets?

The answer may well be that the Murdochs have not yet come up with a model for charging for online content, but nonetheless feel obliged to try in the context of such an unforgiving advertising climate. The London Paper may have been an expendable vanity project, but closure isn't an option for News International's online operations.

With that in mind, the way forward may lie in taking exactly the approach that News International has rejected with The London Paper: collaboration. Many media analysts believed that the Murdochs were considering merging their title with London Lite – and that a single afternoon freesheet in the capital might have a shot at profitability.

If News International is to deliver on online profitability, it will have to reconsider its reluctance to work with its rivals.

For one thing, if everyone else stays free, its titles stand less chance of making a go of paid-for. For another, the best model for the UK press may be to appoint an agent or distributor to sell across all its constituent titles using a system of micropayments. The days of the newspaper wars through which Murdoch senior built the empire might then be over.