Sunday, September 16, 2012

News as credence goods?

Thinking back to Jim Moroney's speech at ISOJ this past April (http://vimeo.com/43911345) and after reading the textbook's discussion of search goods, experience goods and credence goods, I wondered whether news companies suffer from news' being seen as credence goods by consumers where product in-differentiation, among other things, contribute to its inability to create demand?

In a way this goes back to Picard's point last week about the need for journalists to create "value," which Moroney defines as the interaction between relevance and differentiation in his talk. Nonetheless, the problem here lies in that credence goods by definition implies a direct relationship between price and demand -- while this kind of makes sense if we were to compare those free newspapers we often see in restaurants or on the streets and local newspapers in print, it becomes inapplicable when we move online because online news is still largely assumed and expected to be free regardless of the brand, etc... 

Looking forward, I wonder if news apps would become the new credence goods in the future if news companies continue to struggle with product commodification and the quest among the public for good quality journalism persists? (e.g., "I will rely on App A for news rather than App B because the former is more expensive, which surely implies better quality if nothing else...")

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