Newspapers calculate value of implementing pay walls

Newspapers realize the current trend - where online ad dollars aren't matching the revenues lost from declining print subscription, newsstand sales, and print ads - is not sustainable.

In the news 

The New York Times has indicated it will institute some form of payment for online content beginning this year.


Why does it matter?

Newspapers realize the current trend - where online ad dollars aren't matching the revenues lost from declining print subscription, newsstand sales, and print ads - is not sustainable. Efforts to migrate at least part of the NYTimes.com audience to a paid content model will be closely watched.

But Randy Bennett, senior business development VP for the Newspapers Association of America, suggests online pay walls are only part of the industry's revenue diversification strategy. "There will be a focus on generating additional ad dollars from print and other platforms," he says, "as well as on digital strategies on mobile and tablet computers."

He also cautions that what may work for a national outlet like the Times may be hard to replicate elsewhere. "In more competitive markets, papers that have moved to pay walls have struggled, so we're likely to see a more nuanced approach to how the industry effectively gets subscriptions."

A likely outcome of this shift to paying for online newspaper content is a drop in audience numbers. When the Times of London and Sunday Times went to a full pay wall for its sites last year, readership fell by more than 60%.

A similar decline at US newspaper sites might trigger some changes in PR outreach strategies, but Jeff Beringer, SVP and global practice leader for digital marketing at GolinHarris, suggests many of these sites will still remain good targets.

"Clients still want some idea of how large an audience they'll reach through a placement, but there is now a much bigger emphasis on the quality of the interaction," he says.

The digital audience is gradually getting used to paying for content, notes Beringer, adding, "The Wall Street Journal has done fairly well getting people to pay for information on iPads and mobile devices."


Key facts

1 FT.com reported 189,000 paid subscribers in October, up 62% from the same month in 2009


2 US newspaper websites attracted 102.8 million unique visitors in September, according to the Newspaper Association of America


3 More than 55% of people aged 25 to 34 visit online newspaper sites, more than double the percentage who visit CNN.com, Yahoo News Network, or MSNBC.com

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