Page 16 - CIMA SCS Workbook August 2018 - Day 2 Suggested Solutions

SUGGESTED SOLUTIONS

should be carried out. Checking the background of a website before believing/sharing it’s content.
A newer website, for example one created in the last two weeks, will have less credibility than a
website that has been in existence for a long time.

FNG could offer guidance and training for key stakeholder groups too, if readers were more aware
of fake news sources and implications they would be less likely to read and share it themselves
reducing its effectiveness. In line with our recent efforts with the Borland Government on literacy
we could go into local schools to help educate school children about fake news and its
implications.

The work FNG is doing with the Borland Government is certainly a good thing to help reduce the
threat of fake news. As well as helping to set a strong tone, it helps build relationships with
various stakeholders. One key group to help in protect against fake news is fact checkers. To help
avoid any issues a strong relationship with fact checkers will help us make sure that what we
report is accurate.

EXERCISE 3

Email

To: Den Rice
From: Senior Manager
Subject: Interest Paywalls

Paywall Risks and controls

The key to paywalls appears to be to offset the decline in print sales and the reduction in
advertising revenue. Certainly there does appear to be some optimism that while online paywalls
have not worked for all print publications they could be suitable for local news distributors like
FNG. Serving a niche market with information that is unavailable elsewhere makes paying a fee
more appealing. There are a variety of option that FNG could use a monthly or annual
subscription (often called a hard paywall) or metered approach where you are allowed a certain
number of free articles in a period and then have to pay if you go over that amount (often
referred to as a soft paywall).

One of the key risks related to introducing a paywall is that it reduces the traffic to our websites
which will reduce the advertising revenue further so rather than helping to increase the revenue
it will have the opposite effect. A key control for that would be to make sure that we were
offering people who subscribed something that they couldn’t get elsewhere, whether that was
unique/exclusive content or whether they would be given priority access. Some newspapers have
offered a printed version as well as the online content. Offering the printed version would help
reduce the decline in our printed circulation numbers, so would hopefully encourage companies
to continue to advertise in that form too, which has a higher revenue return than online
advertising revenue.

Implementing a paywall would have significant costs to make sure that it is set up correctly,
anything that requires significant cost, poses a financial risk. Consideration must be given to
whether the benefits created by the implementation outweigh the costs. In terms of mitigating
such a risk, thorough planning is the key control. Time must be spent considering what is the most

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