Be them professionals or just ordinary readers, this year was one of burning questions tormenting everyone interested in the online press market: Will the internet users be willing to pay for high-class journalism of a famous brand, present on the market since decades? Or will they make do with what the World Wide Web offers them for free? Which will prevail: attachment to favorite newspaper or economic calculation?
For many, the direct cause for undertaking these deliberations was the closure of the websites of such media legends as The Times and The Sunday Times. This step taken by News International (part of Rupert Murdoch’s News Corp.), was announced on 26 March 2010 and concerned the company’s plans to limit the accessibility to the sites in June 2010. The aim of this development was to implement charges for access to the newspapers’ online content. That decision was reminiscent of over a year long conflict between the owner of News Corp. and the Mountain View giant that originated in the accusations made by Murdoch against Google. The media mogul implied that its opponent made unlawful use of the content and declared that its titles will be removed from the search engine’s index.
The Times and The Sunday Times followed in footsteps of The New York Times and The Financial Times along the path cleared by Murdoch a year ago. This decision was summed up by the Chief Executive of News International, Rebekah Brookes: We are proud of our journalism and unashamed to say that we believe it has value. James Harding, the Editor of The Times, said that he is aware that many see this as a risk but nowhere near as big a risk as continuing to do what we’re doing.
But this is history. Currently, we live in the time of payable websites of The Times and The Sunday Times, and for many the issue of effectiveness of the model was the one of utmost importance. For over a month now everyone who would like to enjoy the online The Times and The Sunday Times must shell out the due charge. Previously, the readers of these two dailies had to register at the website for free to have full access to the content. We could only guess how this model is performing – until 19th July. This was the day when the first data on usage of this website emerged. This information, however, was not obtained from the interested parties, but from Dan Sabbagh, ex-correspondent of The Times, and presently a co-owner of a site presenting media world news, Beehive City.
As revealed by Sabbagh, the number of persons who registered within the free-of-charge period was 150,000, while the number of readers who paid for the access (after the obligatory free registration was over), reached a modest 15,000. According to an analysis published by the Guardian, this means that 12 percent of online editions’ readers from before the registration decided to open an account, and then every tenth of them actually paid for the access. In the same article it reads that with the onset of the obligatory registration, the number of visits dropped by approximately 58 percent compared to the time period when the content was freely accessible (a week after introduction of the charge the fall reached 67 percent).
Another source, IAB UK informs that the number of users who proceeded to the actual website of the newspaper after a visit to the registration page amounted to 84,600 in June, which translates into a 93 percent drop compared to the May results. But the outlooks for The Times are not all gloomy – there is some good news too. According to the same data presented by Sabbagh, the number of persons who paid for the dedicated The Times iPad app amounts to 12,500. Taking into account the small number of individuals using the Apple’s novelty, the result is truly a very good one.
Sam Kumar, Digital Advertising Manager at another media giant The Economist Online UK which does not limit its role to the one of an observer, actively working on their own content monetization model, summarized those trends in the following words: I think that print is just going to be redefined but it still will be there and it is still going to be the biggest channel. What needs to be dealt with is the issue how the readers consume the brand itself – and if it is in print, or if it is online or through an iPad we’ve just got to make sure that they have enough content to fit all the devices, to fit the lifestyles of end-users. I don’t think that one channel is going to supersede the other (full interview with Sam, as the speaker on Internet CEE 2010 conference in Warsaw: http://bit.ly/d8bYya).
The Times and The Sunday Times were not the avant-garde in introducing paywall. In 2002, The Financial Times started charging for Web access to published stories. Last year FT.com revised its paid-content strategy by introducing micropayments for individual articles as an alternative to a subscription. It was followed by the British MoneyWeek, which started using a paywall in 2005, reaching 60% of the magazine content paid every month in 2009. Another top-shelf player amidst global publishers, The Wall Street Journal, claims that over 1 million of paying WSJ.com subscribers.
The question whether it can be a universal and successful strategy has been highly controversial for years on. Also, in the CEE region and in Scandinavia traditional, offline publishers are trying out various ways of doing business online. Some of them are very successful, such as Agora, one of the largest media companies in Poland, with the flagship business of Gazeta Wyborcza, the biggest Polish daily. Gazeta is the first major Polish newspaper with the strategy focusing on its digital versions, available via various devices: PC/laptop, mobile devices and iPad.
Even the very traditional media players such as The Bonnier Group, 200-year-old media company based in Stockholm, with operations in more than 20 countries, are revising their strategies and paying more attention to the Web presence. It already proves effective – as Jonas Muller, Commercial Manger at Danish Bonnier Publications commented during the interview given at Internet CEE 2010 conference: The biggest shift has probably been in the way we obtain new subscribers. 4-5 years ago we didn’t obtain many subscribers from the internet, today we get the most valuable customers from there and that has been an increasing part of our business over the last years (full interview: http://bit.ly/azjYyM).
What will be the future of the paid content? No one knows for sure, but the story of those trying it out now will become another useful case study that others, interested in introduction of the paywall, will be able to learn from. Jeff Jarvis, author of the international bestseller What Would Google Do? and the columnist for The Guardian holds a down-to-earth view: to try to transpose old business models to this new business reality is simply insane. Just because people used to pay in print they should pay now – when the half-life of a scoop’s value is a click, when good-enough news that’s free is also a click away, when the new newsstand of Google and Twitter demands that you stay in the open, searchable and linkable? This argument I hear about paywalls comes from emotional entitlement (readers “should” pay – when did you ever see a business plan built on the verb “should”?), not hard economics.
