The Associated Press (AP) has backflipped on its decision to increase membership rates in 2009, a key factor in the growing list of papers seeking to terminate their AP content agreements.
AP said its board of directors had approved a "moratorium" on the rate increases and would "complete a review of its pricing and governance structure" by the middle of 2009 and carry out a review of its membership structure. In the meantime, AP will "provide all member newspapers complete access to all AP text content, at no extra cost."
The move may decrease the growing surge of newspaper companies and individual newspapers leaving AP. The Tribune Company (Chicago Tribune, the Los Angeles Times and others) gave notice in mid October, and E.W. Scripps was said to be considering a similar move.
The decision by AP to not rise its rates at a time newspapers are bleeding readers and money, and at the start of the serious recession, obviously makes a lot of sense, but it doesn't change one fundamental thing that will continue to drive down AP membership: newspapers are dying. As we reported today, the problems in the newspaper industry even go as far as the NY Times. Newspapers have to cut costs, and if they can find cheaper alternatives to AP, such as sharing content between papers, they will do so, and in some cases, already are.