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Summary:

As more newspapers kick around the idea of charging for content, much of the attention has been focused on the pay models employed by the bi…

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photo: Flickr / from a second story.

As more newspapers kick around the idea of charging for content, much of the attention has been focused on the pay models employed by the bigger players like the WSJ and the Financial Times. But quietly, some small- and medium-circulation papers are coming up with their own formulas to get readers to pony up for access to their websites. We checked in with some of these papers to find out how much they are charging and how they’re faring.

This is, by no means, a complete list. But one can draw some general conclusions by looking at the experiences of what is admittedly a very sample size. The newspapers tend to be located in smaller, often rural markets; online-only subscriptions are typically priced at a substantial discount to the print edition (in general, about 75 percent of what the print product costs); where numbers are available, the number of online subscribers is still a tiny percentage of their print counterparts (less than 5 percent); and many of these papers say they began charging not so much to make money online, but rather to protect sales of their print editions.

Newspaper: Daily Gazette
City: Schenectady, New York
Average paid circulation: 44,242
Pricing plan: Online-only subscriptions are available for $2.95 a week; while print subscribers, who pay $3.00 a week for home delivery, can pay an additional penny each week to also get unlimited access to the website as well as to an electronic edition. Blogs, AP stories, TV schedules, photo galleries, and breaking news remain free.
When pay wall was introduced: August 2009, although the paper was already charging readers to access the electronic edition
Results: Website traffic has plummeted by 40 percent in the three weeks since the Gazette started charging for most of its online content, including obituaries, managing editor Judy Patrick tells us. But she says “online subscriptions are slowly building.” There are 670 online-only subscribers.
Comment: The Gazette competes with the nearby Albany Times Union, which makes all of its content available for free, although it does charge 75 cents to access a digital copy of the paper. It’s too early to tell how the Times Union’s traffic has fared.

Newspaper: Valley Morning Star
City: Harlingen, Texas
Average paid circulation: 23,294
Pricing plan: Online-only subscriptions are available for 75 cents a day, $3.95 a month, or $39.50 for the year. Daily print subscribers get free access to web content and also to an e-edition of the paper. Weekend subscribers have to pay an additional $3.16 per month for online access, while Sunday-only subscribers have to pay $3.56 a month. Event listings, obituaries, AP stories, video, blogs, and classifieds all remain free.
When pay wall was introduced: July 2009
Results: A representative did not respond to a request for comment, but since the Morning Star started charging for online content in mid-June, another Freedom Communications daily, the Lima News, has followed suit. Traffic to the Morning Star’s website was actually slightly up in July, according to Compete.
Comment: “It will allow greater value to our many loyal print-edition subscribers by not giving away the news to non-subscribers,

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  1. Quick takeaway– charging for news online does not work.

  2. Yes, Education Week, a national paper covering K-12 education issues, has had a pay wall for its site since 2005. We're still here to tell the tale, & in fact generate a large chunk of revenue from our non-print publications. (full disclosure, i'm the site's online production manager)
    http://www.edweek.org.

  3. Charging for the current format of news don't work. I believe charging for content will work once they are willing to produce infomedia work paying for.

    There is an underlying issue that these newspaper people won't admit regarding charging for content because it involves them. They do not want to fess up and admit they need better quality and better qualified writers to produce news and media content.

    The current status quo of news writers relied upon advertisers and sponsors to underwrite their works and these writers did not have the incentive to produce high quality news content.

    Notice you hear a lot about proposed business models on how to charge for content but very little on how to adapt the organization to produce quality news content.

    No talk of attaching writers salary and bonus to producing paid content. No talk of producing premium infomedia that provides extension background. No recruitment of real-world experience people to turn into premium writers.

    The status quo cannot look at themselves in the mirror and they still want to produce tabloid style media and expect someone to pay for it.

  4. Another paper to add: The Manhattan (Kansas) Mercury.

  5. The "drive people back to the print" argument is an incredible example of not understanding anything about what is happening. No doubt some publications will have fleeting success stopping the bleeding but the notion that grossly overpricing their web sites will serve to reverse technology is insane.

    Also, it may be time for some of them to wonder if they got over for years, getting far more for their ads than they were sometimes worth, and in doing so became lazy, high cost producers who cannot compete in a real marketplace.

    For all the crying about "giving away" content, weren't they doing that anyway? How many newspapers or magazines were covering more with subscriber dollars than just the cost of printing and delivering, costs they do not have online. Editorial was always paid by advertising. If it costs me $2 a month to deliver a magazine to a sub and be pays $19.99 a year, for example, I am already ahead $4. The problem is valuation of online ads versus print.

    Comparing a fleeting online impression to an ad in a single issue creates a flawed CPM comparison. But all the effort into coming up with creative ways to get people to pay online (which they are never going to do for most publications) should go into creating the valuable model for online ads. By propping up ancient print editions they allow advertisers to postpone making the leap online with those dollars that go to the print publication. If the local print paper vanished does anyone not believe that traffic and advertising on the web site would rise?

    Lastly, every small paper in the US apparently feels that every nugget in their papers represent journalistic excellence that people cannot do without. Most of it is highly replaceable news or simplistic articles more suited to passing time on the train commute than as do or die information.

    Back in the day there were few other ways for people to get this information so they read the paper. But the cat is out of the bag…people have hundreds of choices now and the monopoly on information delivery is gone forever.

    Learn how to compete, cut costs, and embrace the efficiencies that the online world offers. Or die a slow death delayed slightly with these stunts.

  6. Interestingly, the plain message seems to be that web sites are expendable.

  7. Jean-Christophe Nothias Thursday, September 3, 2009

    Turn your eyes to Old Continent and visit mediapart.fr. A spin-off from Le Monde that is pure online media charging 9€ per month. 30 journalists trying to produce quality content. So far, more than 22 000 subscribers. Revenue is to get close to 2 M€ in 2009. A true experience to watch.

    @ted : quick takeaway : charging for quality news online works.
    @ed nunn : you've got the keystone argument!!

  8. Perhaps publishers who charge should consider creating a vibrant Social aspect to their online offerings as another exclusive, added-value for their paying customers. The ability to contribute, participate and network might be a big draw if publishers create a stimulating, active online community, a townhall if you will where thought leaders really need to be. Something to consider (Note: I am CEO of a white label social media platform company)

  9. Looks to me like, at least in the Little Rock example, putting up a pay wall has a fairly strong track record — seven years — of preserving the print circulation. My take-away is that, if you provide a strong local news report, perhaps you can shore up the newspaper by charging nominally for online access. Flat circulation since 2002 is a real success story compared to the plunge that many other newspapers have seen, particularly in the regional/small metro market. Perhaps we ought to look at those crazy fellas in Little Rock as being a little less crazy!

  10. @ Craig – it works for you/edweek because its niche and unique content.

  11. The Pittsburgh Post-Gazette just introduced PG+, an exlucisve pay-for-website. It just went live September 1, 2009, but I would definitely add it to your list and key a close eye on how well it's doing.

  12. The picture is a mixed one, some papers did benefit from online subscription.

    I think many more would, if they did not try to put "a paid wall" or "stear readers back to print." These all seem like wrong reasons . Then, charging for the obituaries ? Come on!

    I see the need for a brand new consulting business: explaining to publishers and content creators what premium content is and how to sell it – just the way we have SEO or ad placement consulatancies. Putting a price on content is not enough.

  13. Kudos to Joseph Tartakoff for actually finding some information on this important, polarizing topic. The experience in Arkansas is very encouraging for mid-sized dailies. And to everyone criticizing those who charge: their goal is to stabilize revenue. That's actually a pretty smart thing to do when you run a business and have bills to pay.

  14. Check out Kankakee Illinois and also Bloomington, Indiana, a Schurz Communications paper. I believe they have been paid for 7 years. Publisher, Mayer Maloney.

  15. I agree on fighting technology. But at the same time, if I was running a small town paper, the formula of free to subscribers and a fee to non-subscribers seems like the correct way to go. Aside from the CPM issue, if a paper could move all of its subscribers online over time, it would reduce a number of headaches in running the operation. Products like the Kindle may bring momentum to this change.

    From a competitive standpoint, in a larger market, the issue may be the TV networks. Living in Nashville, I rarely go to the Tennessean for breaking news online, instead preferring the local CBS affiliate website. Papers that compete in such markets may have a tougher time making the subscription model work.

  16. In Massachusetts both the Martha's Vineyard Gazette and the Daily Hampshire Gazette charge for content online.

  17. Jean-Christophe Nothias,

    Thanks for the Mediapart link. It is refreshing to see media companies looking to do something like than to whine endlessly that nobody is willing to pay for their great 90% non-unique content.

    I have always believed it is possible to do what Mediapart is doing according to you. It needs a massive refit of existing content production models, though, which the old dinosaurs have about 2-5 years to go before they are browbeaten into it.

  18. @ED You are right. "@ Craig – it works for you/edweek because its niche and unique content. "

    But isn't the goal for media outlets to be producing/providing "unique" content anyway? Give your users information they need to know, give them quality (and give it to them on their platform of choice) and they might just be willing to pay for it. I think @Jean-Christophe Nothias & @ed dunn make this point well.

    @Mark, i think your idea has merit too. "I see the need for a brand new consulting business: explaining to publishers and content creators what premium content is and how to sell it " Never thought i'd be advocating for more "consultants," but there you go.

  19. another paper to add – The Daily Republic – Fairfield, CA

  20. Valley Morning Star in Harlingen, Texas, owned by Freedom Communications, has sister newspapers just a few short miles, 30 minutes or less, down the road in both directions — The Brownsville Herald and the Monitor in McAllen. All 3 share stories and always have. Essentially all stories can be found in the other 2 papers. If not there, on the 3 broadcast TV channels and their news websites.

  21. You might look at afr.com, which appears to be separating online from print with a pure online product that allows a PDF of the paper in a high priced bundle.
    Don't know how they are faring but it seems to be extending the news cover and adding specialist TV and archives and so on.

  22. How is charging for your product fighting technology? More like fighting free-loaders. Print readers are far more valuable than web readers. The gap is narrowing, but it is still awfully wide. Latest daily newspaper industry averages I've seen are something like $600 a year in ad revenue for each print subscriber vs. about $40 a year for each web reader. And for mid-sized regional dailies, swoop in and out search engine traffic is worth little to their local advertising base. So if they lose a lot of web traffic due to a paywall, it doesn't necessarily hurt them. These folks may be pioneers, not dinosaurs.

  23. The news industry is changing rapidly, and this article and others are creating a lot of discussion about it. Check out http://www.colby.edu/lovejoy to read the blog. It's quite thought-provoking.

  24. Another paper to add: The Brunswick News in Brunswick, Ga.

  25. Greg Golebiewski Friday, September 4, 2009

    I am glad to see so many local papers taking on the idea of charging their readers for (premium) content.

    Znak it! envisioned a need for that two years ago, when everyone was still speaking about the absolute superiority of the ad-supported or "free" models, which has proved to be not so great. We then developed our content management and payment platform, ideal for content providers to charge for subscription and/or "on demand" pay-as-you-read access to selected articles, interviews or pictures or a bundle of articles and additional pics or data, to differentiate from the print issues.

    The system is based on the concept of virtual currency, and as such can be used across many different media and geographic locations. Anyone with a cc or PayPal account can buy our Znaks, and then they can "znak it" (or pay for) any article or piece of content without any additional registration or even disclosing their cc or personal information — the system takes care of all the transaction processing for both the readers and the content providers. There is no need to create any individual "pay walls" or special security gates.

    In addition, Znak it! works well with ad networks, meaning that the readers have an option to buy our credits (znaks) with cash, or they can earn the credits by clicking on interactive ads or completing brief online surveys. In this case, the papers still get the money for each piece of content accessed through Znak it!, and the readers can use their "earned credits" and thus access the desired content without any additional charge ("free" or supported by the ad networks). And there are many other benefits to users and content providers.

    We presented this model during two recent Web 2.0 Expos and to many US publishers and media organization, however; with little or no success. That I am so glad to see a growing number of local papers starting to use similar ideas on their own. Perhaps, they will create the "critical mass" necessary for the industry leaders to realize that the solutions to their revenue and profitability problems are out there, ready to be used, and that in fact they have been losing billions by resisting the necessary changes.

  26. Gotta say, one of the better discussions on this t0pic. Of course, it has actual data at the core. My winners/losers then thoughts.

    Winner: Quality of content – Alan and Ed are spot on that many, many papers grossly overvalue the quality of their content. In my market (PVD, RI), the blogosphere frequently out-reports the cash-starved daily. As for pipsqueaks like my local Pawtucket Times, they just run press releases and are an embarrassment to your industry. They've even taken down from the website a story about a new clergy/sex abuse charge – but left up the story about the congregation rallying to the pastor's cause. "Journalism" as you'd recognize it only comes from the blogs. Make something worth paying for and people will pay what they think it's worth. Currently, the value of local news content is approximately zero.

    Winner: Correctly assessing the value of a web impression. Web ads – especially the context-free type of display advertising that NP websites specialize in – is a low impact medium. End. Of. Story. This relates back to quality of product, as well. As to Bob's entirely sensible, entirely gonna work social media idea, the reaction I've heard is: "I'm selling news, not building communities." Indeed, but for how much longer?

    Winner: Recognizing the entire competitive landscape. In general, newspaper websites dominate the traffic in their markets compared to TV or radio sites. Blogs, even aggregated, get but a pittance. But the trend lines don't look good for the papes. As video grows on the web, text will continue to lose value. I personally get a sense from publisher comments that if putting up the pay wall kills the website, that's fine with them. They probably hated it from the beginning.

    Loser: Hating your website. Do I even have to mention the downside of this approach? Newspapers have been losing market penetration since the early 1960s, and the numbers drop fastest with the advent of new technologies. TV, cable news and then Internet each took their bite. Does anybody actually believe that a commercial news outlet can exist a decade from now with out a website?

    Loser: Hating the Internet and the Bloggers. Newspapers just have to get over themselves. The provision of information is easier now than ever. More people with more eyes reporting more things faster IS A GOOD THING. As much as I like that this trend is being tracked, I think it's important to watch things like SacPress.com in Sacramento where they train their volunteers in standard journalistic techniques. Volunteers who do these things for free for the benefit of the community. If newspapers don't understand how spectacularly threatening that is, they'll probably say things like: "I'm selling news, not building communities."

    Thought: Win back classified advertising. Classifieds – long the spendiest inch in the paper – were a proxy for a commons and thus for community. Newspapers just let Craigslist walk in and take over the community without any kind of a fight at all.

    Seriously, win back classifieds and then we can have a grown up talk.

  27. Messenger-Inquirer in Owensboro, Ky., has a pay site.

  28. Oh yes – your list has to be extended to our ANNONCE…online! succes. We are publishing a (sold) paper for free classifieds since 1986. And we had been the first paper of our kind in Europe which started an online version in 1995. At a time when 95% of the european population did not even know what the heck this internet shall be.
    And as we thought "Why should someone who is running to the newsstand even at rain to buy our paper support someone moving his mouse on his desk to give him – the mouse mover – the information for free?"
    So right from the beginning – 1995 – we charged for content. All the content that had to be paid for at the newsstand was available online – for a monthly charge that was about 25% of the coverprice.

    Starting with about 25 subscribers we are now having a few thousand. If you keep in mind that we are a very regional oriented paper covering now an area of about 3mio inhabitants (those days only 1 million) this is not bad.
    Especially when you realize that we NEVER did anything to promote the site. As we never wanted to "cannibalize" the print product at the beginning we mentioned http://www.annonce.de only in our flag. Nowadays the promotion in the paper covers about 0,001 % of the print area per issue. There has never been anything else than this.

    And we welcome every day 10-20 new subscribers – even so we have the most complicated registration procedere at least in Germany but probably in Europe: You have to give all personal infomation, give your bank account number and have to agree that we take the monthly fee (and any other amount aggregated by extra-services) from your bank account. And than we send you the login information BY POST!
    We mentioned this – in the first place antique looking way of transferring login data – 5! times before, during and of course after registration in bold and bigger letters. And the people register.
    Before I forget to mention it: We are not selling any commercial advertising. We live on selling the paper to our readers. The printed since 1986 and very successfully the online since 1995. :-)
    Dieter Cohnen, Founder and publisher

  29. Rocky Mountain Independent is another one to consider as an online-only paid site.

  30. @Ted:
    Yes, charging for news online works. Check out the format used by Buffalo Business First (http://buffalo.bizjournals.com/buffalo). They post breaking news throughout the week as free online content but reserve the online version of their print edition for print subscribers, who have a special username and password to access the PDF version online and download it. The print stories are not made available online for free. I believe all of the Business Journals use this format. The Business Journal of the Greater Triad Area (Greensboro, NC) used it and was quite successful.

  31. Paywalls kill website traffic. Decreased website traffic is unattractive to advertisers. The paywall may seem necessary to many publications, but it seems to me to be an old world way of thinking about how media is consumed.

    The key is that the internet destroyed the economics of publishing, completely and irrevocably. Whereas printing presses were once incredibly expensive to set up, the cost of publishing on the internet keeps falling asymptotically towards zero. This removes both the competitive advantage and the positive returns to scale print publishers once enjoyed. However, even if society no longer needs newspapers, we still need journalism — and in that seed still lies promise for publishers who can figure out how to come out kicking on the other side of this digital revolution.” – Clay Shirky

    Recently one of our favorite publications, The Portsmouth Herald, announced they will begin charging users to access their website news content. This new fee-based update took effect on November 16. This change has been met with fierce criticism from many loyal SeacoastOnline readers. John Tabor, president of Seacoast Media Group states giving news away for free online while offering the same content in a paid physical paper is “an inherently contradictory and unstable model.” The website currently does not generate enough advertising revenue to cover the costs of maintaining the site and paying Seacoast Media Group’s 33-person news staff, he said. “The truth is that the advertising online will never pay the full cost of the newsroom, nor will a single advertising revenue stream, which is very volatile, supports a lot of local news gathering that we do,” he said.

    In the ever strategic words of Seth Godin “When people talk about the problem with ‘free online’, they’re missing the point. Free is creating lots of attention, but marketers haven’t gotten smart enough to do something profitable with that attention. If someone has commented on your blog or replied to your tweet [or reads your news content], they are paying with their attention. Whilst not being a monetary transaction, that attention must be acknowledged and the relationship built on in order to convert the attention to an action – whether that be clicking through to your website or buying your product or talking about your product/service with someone else (advocacy). Audience members will not sit still for having their time wasted or disregarded. If time is money (and it is) then the audience member is paying with their attention and expects to get their money’s worth.” The following is our take on this internet marketing situation with some ideas to add value to the new paywall based model.

    As John Tabor stated giving news away for free online while offering the same content in a paid physical paper is “an inherently contradictory and unstable model.” Are we again focusing on the wrong part of the equation? Instead of stating that offering news for free online is what makes charging for physical newspapers an unstable model, does it make more sense to argue that continuing to run a print publication with a 33 person news staff is an unstable model? Is benevolently pushing forward a print publication simply delaying the inevitable? Is it time to rethink the business model entirely?

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