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Paywalls – Some Newspapers on the Wrong Track?

Our mantra is free education for all.

So we are extremely partial to the resources that readers can access without shelling out their hard-earned cash. For that reason, we have watched closely, and with subsequent disappointment, the folks at the New York Times who appear destined to begin keeping some of their highly-valued content behind a paywall.

It seems that the Times might want to rethink that decision based on the recent data coming out of Europe and a similar step being taken by media mogul Rupert Murdoch.

The publishing titan and mastermind of the immensely popular Fox News recently began placing the London Times behind such a paywall and the results appear to be extremely negative. According to the Times arch-rival, the Guardian, Murdoch’s paper has “lost almost 90% of its online readership” since February. The site made registrations mandatory in June.

iStock_000009137974XSmallThe Murdoch process works this way: if you are not a registered user of the Times sites, you are “bounced” to a membership page where the reader must register to be able to view the content. According to published reports, just one in four readers bounced to the membership page proceed to sign up. The remainder take their curiosity and their interests and head for other media sources.

Overall, visits to the Times site have apparently fallen to 4.16% of UK “quality press online traffic.” Prior to the mandatory registration, the site saw a 15% visitation rate but sources indicate a “93% fall” in visits when compared with May.

Perhaps most importantly, 15,000 registrants have agreed to actually pay money. Contrast that number with the published stats of 1.2 million online unique visitors a day.

In simplest terms, experts predicted that readership would fall off by about 90% when the site moved to a paid-access model instead of free access. And the results appear to back that up.

Furthermore, there are approximately 150,000 Times print subscribers who receive an online registration free. That would mean a total subscription level of about 165,000 in total, again a far cry from the 1.2 million claimed.

With advertising sold on the basis of x number of viewers, it will be interesting to see the overall impact of the paywall experiment. Will the new revenues generated offset the loss in potential advertising rates based on only 165,000 potential unique visitors a day?

And what of the future? As some writers immediately postulated, the first wave of registrations “are likely to be the biggest burst that the paper gets.” In other words, it is likely all downhill on those numbers as the days progress.

In addition to the negative impact on ad rates, we have also noted that such firewalls will have a disastrous effect on blogging references. If we bloggers are unable to cite an article that our readers can further access, then we will simply will not be linking to it. And given that links represent the fuel that feeds any internet site, the paywall experiment could prove to be a dismal failure.

Yes we are biased – but it is with a sense of satisfaction that we note that charging for online news appears to be a thing of the past.

1 comment

1 Joseph Thibault { 07.23.10 at 8:52 am }

Totally agree, the issue for these publishers (even the ones with crack reporters) is that there is a repetitive abundance of news coverage on the web. Odds are very high that the “walled garden” content is available in near exact form, tone and depth somewhere else for free. The internet audience (including bloggers) will naturally migrate to those open sources.

This is a great read on a similar topic: http://www.ethanzuckerman.com/blog/2010/03/04/jonathan-stray-on-original-reporting-imaginary-abundance/

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