The Debate Over Paying for News
September 30, 2013 | 3:11 pm
By Joanna Cabot
Matthew Ingram has a great write-up on the question of paying for news. Will people do it? Do paywalls actually generate revenue for traditional newspapers? The sobering answer is, not really—unless you are the New York Times. From the article:
“Take Gannett, for example. The newspaper chain is the largest newspaper publisher in the U.S. as measured by circulation, with more than 81 daily papers, and it has been betting heavily on paywalls to drive additional revenue at its various properties. So after two years or so of trying to push its paywall strategy, how many of Gannett’s newspaper readers have been convinced to sign up for digital access? According to Mutter, that number is a little over 2 percent.”
Anecdotally, I can tell you that ever since the Toronto Star, my local daily, out up their paywall, I have visited their website maybe once. They’ll give you eight free articles a month, but if you are checking the news on shared computers—at work, for instance—you can burn through your free 8 in about as many minutes. More troublingly for the Star, the one resource they do have that I have been willing to pay for—their Star Dispatches ebook subscription series—is potentially on my chopping block too. One of the reasons I began subscribing was that I would visit their website for the bread and butter news, see ads for the ebook of the week and be interested to read it. Now that I don’t visit their website, I don’t see those ads, so I feel like I could cancel the service, save myself a buck a week, and not miss it.
I’ve heard, through the grapevine, that the Star has seen a massive decline in website visitors since their paywall went live—and a small uptick in print subscribers, to everyone’s surprise. Maybe that’s the effect they were going for. But the news critic quoted in Ingram’s article makes the point that if you compare even the Times with something like Netflix, there is no contest. Netflix is 80% more successful. That suggests that people will pay for content—of the right kind. They’ll pay for entertainment, not news.