A Revenue Model For The Digital Age

Whether you believe in their efficacy or not, paywalls are proliferating across the digital media landscape, with a variety of models now in operation.

Paywalls, or digital subscription services if you prefer, are not new. The Wall Street Journal was the first major newspaper to implement a paywall, in 1997. As of last spring the newspaper had over 522,000 paid digital subscribers, according to ABC.

The Financial Times launched its current pay model in 2007 and ABC recorded 267,000 digital subscribers at the end of 2011.

Both of these newspapers provide specialist content. Skeptics have long maintained that paywalls can’t work for general news websites as readers will merely bounce off to another site where they can access news for free.

For this reason, The New York Times’s metered paywall, introduced in spring 2011, has been celebrated as a successful model that could be replicated by other mainstream newspapers. In one year The New York Times grew its online subscriber base to 450,000.

The New York Times began by allowing free access to 20 stories per month from a single computer. Readers who accessed articles through email, blogs and social media were allowed to view stories even if they had already read their free quota of stories. The NYTimes.com homepage remained open and free to browse.

A year into the new subscription model and emboldened by their initial success, the Times restricted the number of stories that could be viewed for free to 10, with further stories still available through email, blogs and social media.

Paywalls Go Global

Over recent months paywalls have gone up at many large US newspapers including the LA Times, where a metered model has been introduced; at the Providence Journal and across Gannett’s 80 community news websites. The PEW Research Centre recently put the total number of US dailies with digital subscription models at 150, although estimates of how many are currently in operation range as high as 300 (AP).

Australia’s two national dailies both now operate paywalls. The Australian introduced a paywall at the end of last year and at around the same time, The Australian Financial Review relaxed what had been a particularly tough paywall to allow print subscribers have free access to its website and cut the price of access by half across the board.

In June, Fairfax announced that it will introduce paywalls for the online editions of its Metro publications, the Sydney Morning Herald and The Age, both of which will follow the metered model.

Across Europe, paywalls are popping up at newspapers of varied focus and size.

France’s LeMonde operates a model whereby many articles and features are available for free but readers must pay to access unique content.

Germany’s, Berliner Morgenpost Online operates a paid-model that is free to print subscribers and which places just some of its content behind the wall.

In the UK market, News International’s The Times and Sunday Times launched hard paywalls in 2010. These sites ask users to pay for access for a given time period and offer packages starting from £1 for 30 days access to The Times and £2 per week to the Sunday Times, including the printed publication.

The Independent introduced a part paywall in 2011 for readers outside the UK, citing the free availability of BBC news as one reason why it didn’t make sense to ask the British public to pay for access to the newspaper’s online content.

Norway has an unusual situation in that local and regional newspapers maintain a particularly strong position. In this market, paywalls have been introduced at a number of local newspapers’ websites. Although they operate a variety of approaches, most offer a selection of articles for free, with payment requested to access additional content.

At home, The Sunday Business Post launched a paywall in late 2011. At the same time it invested in its digital offering, redeveloping its website and launching apps for iPad and iPhone. Much of the content found at businesspost.ie is available for free however users must pay to access premium content published by the Sunday title.

News Media Landscape Evolving

The widespread adoption of paid subscription models across the web is evidence that the news media landscape is evolving.

Paywalls may not yet have provided the keys to the proverbial kingdom but as paywalls become more prevalent there will remain fewer plausible alternatives that offer the same level of high quality content.

Where content remains free to access you should take advantage of this while you can. Indications would suggest that it’s unlikely to remain free in the longer term.