As Mutter (who likes to call himself the “Newsosaur”) puts it in his blog post, paywalls or subscription plans — which have been increasing in popularity to the point where a majority of the large papers in the United States now have them — seem like a great deal on the face of it. You put up a pay barrier, allow some leaks through social media, pick the number of pages that your pay “meter” accepts before triggering the demand for payment, and then sit back and let the extra revenue roll in. But as Mutter notes, it’s not quite that simple:

“All good? Not necessarily. The reason to worry about paywalls is that they severely limit the prospects of developing a wider audience for newspapers at a time publishers need – more than ever – to attract readers among the digitally native generations that represent a growing proportion of the adult population.”

Not everyone can be the New York Times

As an example, Mutter looks at the paywall put up by the Charleston Post and Courier, and how it increased revenues with only a small dropoff in circulation — in other words, a win-win as far as newspaper paywalls go. However, Mutter also notes that since the paywall was erected a year ago, the Post and Courier has only gained a small number of new readers: about 1.5 percent of its overall circulation. That’s verging on no growth whatsoever (Note: We’re going to be talking about paywalls and other forms of monetization at paidContent Live on April 17).

Although Mutter doesn’t mention it, someone is bound to point out that the New York Times has seen dramatically larger growth in the number of new digital subscribers: according to the Columbia Journalism Review, it has been seeing average increases of more than 10 percent every quarter. However, it’s also true — as the authors of the recent Columbia report on the future of “Post-Industrial Journalism” noted — that the NYT is an outlier in almost every sense of the term, and therefore isn’t a good benchmark for all papers.

Mutter, who does strategic consulting for media companies, says the 1.5-percent growth in circulation the Charleston Post and Courier has seen is about the average for the industry. That’s light-years away from what the NYT has experienced. And that’s one reason why I’ve described paywalls in the past as a “sandbag strategy” — they keep the water from coming in, but they don’t really do anything to help companies figure out or deal with the reasons why the water is rising in the first place. As Mutter notes:

“The modest take rate is worrisome, because it means that the Post and Courier, like most other papers, is not attracting nearly as many new digital readers as it needs to. Digital readership matters, because digital, not print, represents the future for newspapers (and most of the rest of the media, too). Unfortunately, newspapers so far have failed to attract a significant number of individuals who came of age in the digital age.”

Where do new readers come from?

The average age of a newspaper reader is currently somewhere around 57 — a survey conducted for the industry by Scarborough Research showed that more than two-thirds of readers are over the age of 45, Mutter says. While paywalls may be doing a great job of keeping those users from bolting to the web to read everything for free, and possibly of increasing print circulation (which is where a majority of newspaper revenue is still coming from), how do they help bring in new readers? The short answer is that they don’t, or at least not very many.

Paywalled papers have all kinds of tricks for trying to appeal to non-readers: the New York Times not only allows social-media links for free, but it and other papers also open up their paywalls for important stories like Hurricane Sandy. And some papers offer incentives — the recently launched hard paywall at the Orange County Register comes with free baseball tickets. But is that going to be enough to produce any kind of sustainable growth? And what happens to those papers if it isn’t?

Post and thumbnail photos courtesy of Shutterstock / Voronin76 and Flickr user jphilipg

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At paidContent Live on April 17 in New York City, we’ll be exploring how book publishers are adapting their business models for a digital age and rolling out new products designed to take advantage of e-readers, tablets and smartphones. I’ll be interviewing executives from three publishers handling the transition in particularly interesting ways: Dominique Raccah, the publisher and CEO of Sourcebooks; Rachel Chou, the chief marketing officer at Open Road Media; and Evan Ratliff, founder and CEO of Atavist. Here’s a peek at some of the issues we’ll be discussing.

• New payment models: Last spring, Sourcebooks rolled out a romance ebook club, Discover a New Love, that gives members DRM-free ebooks, discounts and access to special events for $9.99 every six months. And Atavist is now offering in-app subscriptions to its e-singles. I’ll be asking Raccah and Ratliff what they’ve learned about their readers and pricing and tips on how other publishers can enact subscription models.
• The enhanced ebook now: Enhanced ebooks got a bad rap a few years ago, when it was uncertain whether readers would pay more for an ebook that included a few videos and photos. But with the increased adoption of tablets and cheaper technology, publishers are finding new ways to integrate digital media into their books. I’ll be asking our panelists about their best practices in this area: How do they decide which bells and whistles to add and which to avoid, and when’s it best to just go with straight text?
• New frontiers of marketing: “Discoverability” is the buzzword on lots of publishers’ lips, but how does it translate into practice — and is it actually a problem for readers? Raccah, Ratliff and Chou will speak about the ways that they are marketing their books online and how they’re working with retailers to promote their titles.

Let me know what else you want to talk about! Sign up to attend the paidContent Live conference on April 17 in NYC here, and in the comments of this post, I’d love to hear your burning digital book publishing questions.

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It also said that last year’s redesign would make subscriptions more meaningful, but has since found out that average users still don’t know what subscribing actually does.

I wanted to see how that actually stacked up in the real world. So I asked both established online video experts like Zadi Diaz, YouTube stars like Amy Pham and average users: How exactly do you do YouTube?

Annette Brown, 47, business owner and mother

How often do you go to YouTube.com?

I watch YouTube videos when I’m on Facebook, but other than that I probably go directly to YouTube once a week or so.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

To search for a new video. During the election if I found a video on Facebook and went to YouTube to watch it, I would usually see similar videos and keep watching but usually I go to a specific video, rate it if I liked it or not and then leave YouTube.

Do you subscribe to any YouTube channels?

No. I thought YouTube was a channel by itself.

What is the one YouTube channel you watch more than any other?

N/A

What’s the most common way you find new online video (on YouTube or elsewhere)?

I find them through Facebook or email.

Matt McLernon, 29, YouTube communications manager

How often do you go to YouTube.com?

About every 5 minutes, by choice. When I’m not on YouTube.com, you can probably find me on the Android app or using the send to TV feature to send videos from my phone to my Google TV.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

It’s both. At work, I do a ton of searching for videos and channels to look for the awesome people making videos for fun or for a living. At home, I’ll flip through my channel guide and watch anything from folks like Vice, The Gregory Brothers, DevinSupertramp and others on YouTube.

Do you subscribe to any YouTube channels?

About 50. When I first started paying attention to my subscriptions, I found I had a ton that I never watched (hundreds), so I removed a bunch and channels became much more useful. I have a mix based on what I like and how frequent they post – some folks post a lot like NASA or The Laugh Factory, some post about weekly like BadLipReading, and some run in seasons like Video Game High School.

What is the one YouTube channel you watch more than any other?

I flipped through my Watch History and I think it’s Red Bull. They do some of the craziest, most inspiring stuff all within a few minutes, and they’re always trying to push the limit with their next video. I know I’m in for a surprise every time from them, from their Kluge video to their Enduro Chronicles series.

What’s the most common way you find new online video (on YouTube or elsewhere)?

These days it’s through the Social Feed on my guide. It’s a feed just of what my friends are sharing on social networks (G+, Facebook, Twitter). It’s like replacing all those “gotta watch this video” emails you get from friends and parents, with a feed you can easily flip through.

Christina Boland, 24, Director of Operations at Grind Spaces and casual user

How often do you go to YouTube.com?

Probably daily.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

To search for a video or theme that I’m thinking of already.

Do you subscribe to any YouTube channels?

No.

What is the one YouTube channel you watch more than any other?

Not sure of any channels — I watch a lot of animal videos and a lot of music videos.

What’s the most common way you find new online video (on YouTube or elsewhere)?

Through word of mouth or Facebook.

Zadi Diaz, Head of Content Development, Disney Interactive Entertainment

How often do you go to YouTube.com?

Seems like I’ve had YouTube on an open browser tab since 2005. I check videos several times a day because it’s an important part of my job and because I’m obsessed with this form of entertainment. It’s what I’ve been doing for the past nine years.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

Both. I do a lot of search through video. YouTube has in many ways taken the place of Google text search when it comes to finding and collecting specific topics of discussion. When I’m on YouTube, I do end up browsing through my subscriptions, especially if the thumbnail and title look engaging.

Do you subscribe to any YouTube channels?

I’m currently subscribed to 157 channels.

What is the one YouTube channel you watch more than any other?

Besides the Disney network of YouTube channels (my favorite is DisneyShows), there are three channels that I keep coming back to: iamOTHER, SoulPancake, and THNKR. I love their smart, positive vibe.

What’s the most common way you find new online video (on YouTube or elsewhere)?

I find videos through sites like Reddit, Buzzfeed, Tubefilter, NewMediaRockStars, and even Kickstarter. I’ll also find new videos through my social feeds on Facebook, Google+, Tumblr, and Twitter. I have a wide network of online friends and colleagues who produce, direct, write, or perform in web shows, so I’ll find new videos through them. And sometimes, I’ll even get a video that I haven’t seen from my mother-in-law via email!

Kristina, 12, student (and my second cousin)

How often do you go to YouTube.com?

At least every day.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

I normally search for a video.

Do you subscribe to any YouTube channels?

Yes, I do subscribe to many people.

What is the one YouTube channel you watch more than any other?

Um I probably watch Shane Dawson more than anything.

What’s the most common way you find new online video (on YouTube or elsewhere)?

I find out through what YouTube recommends actually.

Mickey Meyer, 28, EVP of YouTube network Jash

How often do you go to YouTube.com?

Too Much. Daily if not hourly.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

A little of column A, a little of column B. It’s fun to develop a subscription feed. Most people don’t even know what that means, so it’s cool to just be exploring how it could work, which it seems like no one, YouTube included, knows right now.

When I don’t see anything appealing in my feed, I tend to go to my most top pages, and see if they uploaded something I missed. If not, then I’ll just comb the most popular videos of the day. YouTube’s unfortunately made that harder to do in an effort to prove itself in the realm of original/consistent programming.

Do you subscribe to any YouTube channels?

Too many. Again, it’s really just fun to watch how it’s evolving. I subscribe to some I don’t regularly watch just to keep tabs on them.

What is the one YouTube channel you watch more than any other?

I’ve watched every Epic Rap Battles of History, but I’m a little biased as I used to work on them. I’ve been watching Dead Kevin a lot lately. When Fatal Farm releases new content, I’ll watch any and all of that too.

What’s the most common way you find new online video (on YouTube or elsewhere)?

Friends. I watch what people whose taste I trust, post. Outside of that, Facebook in general is a good barometer of what’s actually worth watching. If three people post the same thing, I’ll check it out. Two, it better have a good thumbnail.

Rebecca Lando, 30, Network Director, Nerdist Channel and Creator, Working Class Foodies

How often do you go to YouTube.com?

At least twice daily.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

Both.

Do you subscribe to any YouTube channels?

Yes; about 25.

What is the one YouTube channel you watch more than any other?

MinutePhysics.

What’s the most common way you find new online video (on YouTube or elsewhere)?

Word of mouth/friend recommendations and links; search; memes.

Sam Louderback, 13, student (and son of Revision3 CEO Jim Louderback)

How often do you go to YouTube.com?

Every day after I finish my homework, for about 3 hours.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

Since I have been using YouTube for so long, I have so many YouTubers that I am subscribed to, so I just browse through my subscriptions.

Do you subscribe to any YouTube channels?

Yes. I am currently subscribed to 64 YouTube channels.

What is the one YouTube channel you watch more than any other?

Right now I mostly watch two different YouTubers: Ijevin and vintagebeef.

What’s the most common way you find new online video (on YouTube or elsewhere)?

I find new YouTubers through collaborations and dual commentaries.

YouTuber Amy Pham, Host of The Platform’s “The Fashion Statement”

How often do you go to YouTube.com?

Weekly, I check in every week to see what’s going on in the YouTube world and the type of feedback we get on our content. I try to keep up with what’s working and what the viewers are responding to, in addition to what isn’t.

When you go to YouTube.com, is it to search for a new video, or is it to browse through your video options?

I usually go to Youtube to browse through any new videos that pop up on my radar; sometimes thought I do find myself searching when I’m on the hunt for a specific music video or tutorial!

Do you subscribe to any YouTube channels?

Yes! The Platform of course, Andreaschoice, MakeupbyCamila, Beautycrush, Essiebutton, Pixiwoo, ClothesEncounters, etc. All the lovely beauty and fashion channels whom I’ve come to respect and become huge fans of!

What is the one YouTube channel you watch more than any other?

The Platform! Although I might be biased in that regard (I check the channel constantly to see what’s working with our audience, and to see if there’s anything I can do to help improve my show).

What’s the most common way you find new online video (on YouTube or elsewhere)?

YouTube, YouTube, YouTube. If you’re looking for new online videos, why go elsewhere but the source?

Final Thoughts

The big thing I observed from doing this survey: The responses from these folk, civilians and industry pros alike, show that social is still a huge part of discovery, even the people who understand the intricacies of the YouTube channel and subscription system.

However, the people actively using YouTube’s advanced features and finding new content through strategies like collaboration aren’t just the YouTube savvy — the youth of today are highly engaged with these methods. The question now becomes for YouTube: Is there a way to get everyone using the site behaving like a 12-year-old?

Want to add your own answers to the survey? Feel free to do so in the comments!

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As Arment explains in his blog post about the change, the need to open up his magazine’s content more for sharing was brought home by the response to a recent piece he published by Jamelle Bouie on the topic of race and technology writing. As with most of the essays in The Magazine, the writer was free to publish on his own blog as well, which he did — and while The Magazine’s version got plenty of readers, the response to Bouie’s piece after it appeared on his own site was substantially larger:

“We allow authors to republish their articles on their own sites (or anywhere else) just 30 days after we publish them. Bouie did exactly that, as many of our authors have. Only then did his article explode into the huge discussion I suspected may result from it — and The Magazine wasn’t a part of it.”

The magazine was cut off from the social web

The Magazine wasn’t part of this broader web and social-media discussion because Arment initially showed only a short excerpt at the website — as well as a download link for the iOS app — when readers shared a story. As the publisher points out, since his magazine doesn’t rely on advertising at all but gets its revenue entirely from subscriptions, a web presence with full content seemed like a fairly low priority, if not an outright negative. Arment calls this “the biggest mistake I’ve made with The Magazine to date.”

“You’d share a link, and everyone would just see the truncated teaser. Some of them would subscribe and see the rest, but most would get turned off by the truncation and just abandon the effort, as we web readers tend to do. Most people with big followings would quickly realize this and, understandably, avoid linking to our articles.”

This is similar to the problem (one of many) that News Corp.’s iPad-only magazine The Daily ran into when it launched: it didn’t even have a website, per se, so initially users who followed a shared link from a subscriber would get a static page. In the early days of the app, in fact, readers were actually sent to an image of the page from the app — something that was impossible to click on or otherwise interact with. The sharing experience was so broken that many likely never bothered.

Where should the freemium line be drawn?

Arment’s problem is a microcosm of the tension that publishers everywhere are experiencing, from the New York Times to the smallest local paper. While some media companies — including News Corp. with some its British papers — have chosen to go with what are called “hard” paywalls, where virtually no content is provided to readers for free, almost everyone else is trying to find a happy medium between that and no subscription barrier or paywall at all.

The NYT started by providing 20 free articles, and giving anyone who came in via a link on social media a free view, a so-called “porous” paywall approach many other newspapers have adopted. But the paper recently cut the number of free articles in half. Andrew Sullivan, meanwhile — who recently launched a standalone blog funded solely by subscriptions — has made virtually of his content free via RSS, but imposed a click-through wall for readers on the site.

The issue for everyone from Sullivan (who will be appearing at our paidContent Live conference in New York in April) and Arment to the New York Times is how much they need to be part of the social web vs. how much they plan to rely on reader subscriptions. A hard paywall essentially means a publication will be supported solely by existing readers, plus a few new sign-ups here and there — but newer or smaller publishers need the word-of-mouth that sharing brings in order to build awareness (and older brands might as well).

As traditional advertising continues to decline in value — something that has taken both the New York Times and the Financial Times to the point where subscription revenue now exceeds advertising revenue for the first time — more and more publishers are going to have to confront this tension between paying and sharing. And in all likelihood, there is no single right answer.

Post and thumbnail images courtesy of Flickr user Giuseppe Bognanni and Shutterstock / Daniilantiq

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The New Press is funded by publisher and CEO Jan-Jaap Heij and a partner, and arose from the ashes of a previous free newspaper called De Pers or The Press. After about five years of operation, the paper was forced to shut down last year as a result of losses incurred during the financial crisis in Europe, Heij told me in an interview from The Netherlands — but instead of closing its doors entirely, the editor decided to create a new entity with many of the same staff and focus solely on mobile news and content.

Readers can subscribe to one writer or a package

Launched on Monday, the New Press app is powered by a company called imgZine, and allows users to pay about $2.50 per month or $23 per year for a subscription to the entire output of a specific author or journalist, or about $6 a month and $50 per year for a package of all the writers who are currently being syndicated through the platform — a total of 11, according to Heij, with a goal of having more than 50 by the end of the year. In the future, he said, The New Press may also offer packages of writers focused around specific topics such as sports or crime.

Jan-Jaap Heij by Frank Groeliken

Although it is still early, Heij says there has been a substantial amount of interest in the app, and not just from users but from journalists and writers as well. As part of its deal with the authors that it distributes, The New Press shares 75 percent of the subscription revenue with them (after paying Apple its 30-percent cut), and if they get 500 or more subscribers to sign up, they get 85 percent. “We have had about 200 people approach us about being part of the service,” Heij says. “After the launch, my mailbox just exploded with requests from journalists.”

Why did The New Press decide to offer a subscription feature for its writers instead of going the traditional route of a blanket paywall or just a charge for the app? Heij says he believes that media is becoming much more about individual brands than institutional ones, and The New Press wanted to take advantage of that phenomenon:

“As we see it, people are now starting to follow journalists as brands and not the media they work for. A lot of journalists have way more followers on Twitter and Facebook than the brands the media company that publishes them, and I think it’s because people want to hear individual voices, not institutional voices. Media brands are losing power and personal brands are becoming more important.”

Heij said that while individual writers have always had strong personal brands, “it’s far more easy than it was even 5 years ago to publish yourself” and build your own following — to the point where some writers such as star blogger Andrew Sullivan have severed any ties to a traditional media outlet and set up their own publishing operation driven by subscriptions.

Maybe not the only answer, but one of many

The New Press publisher said that the current selection of writers is a mix of established or “star” names from different sectors of the journalism market, as well as newer writers who show promise and are willing to experiment. All sign freelance contracts with The New Press, and while they don’t require a certain number of articles per week or per month, Heij says that the expectation is that they will work hard for their channel or “one push of a button and they are gone.”

Some of the content related to its writers is free, the New Press publisher said — such as blog posts from other sites or their Twitter stream, for example — but the majority is behind the subscription wall. Some journalists have been using the service to publish their older material from other sites, he said, while others are writing daily or weekly pieces specifically for The New Press, and some are a mix of both approaches. The New Press also has staff writers who do a live-news blog that is free to users.

So is the personal subscription model the future of media? The New Press publisher says he isn’t prepared to go that far, but he thinks it will be a crucial part of the future of content:

“We see ourselves as a combination of a newspaper, a news app and a publishing platform. People have asked me whether this is the answer to the crisis in journalism and I have said I don’t think it’s *the* answer, but it is one possible answer.”

Heij, who made a substantial amount of money investing when he was younger, says that he and his partner have invested about 100,000 Euros in The New Press, and the venture also raised about 25,000 Euros through a crowdfunding effort to launch the app. “I’m quite certain we will lose money at the start, because everything you do in media tends to lose money at the start,” he said. “But I am optimistic that this could turn out to be a very significant business.”

This story was corrected at 5:06 pm to note that Heij made his money through investments, rather than by inheriting it as we originally stated.

Images courtesy of imgZine / Frank Groeliken and Shutterstock / artjazz and Flickr user George Kelly

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Just a few weeks ago, Sullivan announced that he was severing his relationship with The Daily Beast and launching a standalone website, and asked for reader support in the form of a $19.99-per-year subscription. In just a matter of days, Sullivan managed to raise more than $300,000 and said recently that he has a total of almost $500,000 now — and that more than half of those who contributed to his campaign paid more than they had to (one anonymous subscriber contributed $10,000).

Fans don’t want content, they want a relationship

When I read this, the first thing that came to mind was the “pay what you want” music experiments of bands like Radiohead and Girl Talk, both of whom asked their fans to pay for songs that they could have easily downloaded for free, and got millions of dollars in response. Why did fans do this? Because they wanted to support those artists, not because they wanted music for free — just as readers who want to support Sullivan probably don’t care that they can get the content free via an RSS reader (Note: Sullivan will be discussing his new approach at our paidContent Live conference on April 17 in New York).

The Kickstarter campaign that Amanda Palmer ran last year to raise funds for a new album and a national tour falls into the same category (as does comedian Louis CK’s method of going direct to his fans to sell a concert tour): after quitting a deal with a traditional record label, Palmer initially wanted to raise $100,000 to fund her recording. Instead, she collected 10 times that amount, or more than $1 million. And the reason why her fans wanted to donate all of that money has very little to do with their desire to get an album, or even to see her perform.

Part of what Palmer has done — in addition to detailing what she is doing with all of the money raised — is to turn what could have been a regular tour into a series of personal events. Some of those who contributed got invitations to private shows, in which Palmer would not only invite attendees to come on stage and play (something that caused some controversy because she asked for volunteers instead of paying people) and otherwise interact with her.

As she describes in a recent interview with Billboard magazine, the rise of the social web has made it much more feasible for an artist to reach out directly to his or her fans — and many of those fans are going to be willing to contribute something, regardless of whether they get a direct return or not (a theory that former Wired magazine editor Kevin Kelly has called “1,000 True Fans”). As Palmer puts it:

“I see everybody arguing about what the value of music should be instead of what I think the bigger conversation is — which is that music has value, it’s subjective and we’re moving to a new era where the audience is taking more responsibility for supporting artists at whatever level. My theory is that things aren’t going to pick up until people … instead of saying people should want to pay for music, I think people should want to help their artists. I really think it’s a different way of thinking.”

Connect with fans and give them a reason to contribute

Getting up-close and personal with an artist like Palmer (who at some shows allows her fans to paint her body with washable paint) may or may not be your thing, but there’s no question that it inspires devotion in a fan base. And while Andrew Sullivan doesn’t go as far as Palmer, he is obsessively interested in what his readers want and how they are reacting to what he writes. As he described in his “declaration of independence” post, one of the reasons he decided to look at reader subscriptions instead of advertising was that he wanted to deepen his relationship with his readers.

“For the first time in human history, a writer – or group of writers and editors – can instantly reach readers – even hundreds of thousands of readers across the planet – with no intermediary at all. And they can reach back. We want to create a place where readers – and readers alone – sustain the site. No bigger media companies will be subsidizing us; no venture capital will be sought to cushion our transition (unless my savings count as venture capital); and, most critically, no advertising will be getting in the way.”

One of the most common responses to both Palmer and Sullivan is that very few people can get away with making a living from their fans or readers — in other words, that the two are the “one percent” of artists or creators who can do this. But whether it’s one percent or 5 percent or more, the fact remains that the tools that allow Palmer or Sullivan to do this are more readily available than ever, thanks to platforms like Kickstarter and the TinyPass paywall system Sullivan is using — or 29th Street Publishing, which allows writers to create their own mini-magazines.

Will this allow every writer to do what Sullivan is doing, or every artist to do what Palmer is doing? No. But their example (and others such as Jonathan Coulton) show that as Mike Masnick of Techdirt puts it, when an artist connects with their fans and gives them a reason to buy or contribute, they will almost always do so. All that’s required is that you have something valuable to offer — and that you are as fanatical about your devotion to those fans as Palmer and Sullivan and Louis CK are.

Post and thumbnail images courtesy of Flickr users Christian Scholz and Andres Rodriguez

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As my GigaOM colleague Laura Owen notes in her post on the announcement, Sullivan has been hosting an ongoing discussion on his blog about the changing economics of content, including the influence of tablets and the decline of traditional models based on advertising revenue (we are going to be talking with Sullivan about these and other topics — including his latest move — at our paidContent Live media conference in New York on April 17). And his former employer has been a perfect symbol of the kind of destruction these forces can create, having just shut down Newsweek magazine, which the Beast merged with two years ago.

In his blog post announcing the move, Sullivan makes it clear that his decision is about more than just his own welfare: he said he is trying to prove that a new-media model based on direct reader funding — something he tried for several years before allying himself with Time and then The Atlantic — can work for others as well:

“If this model works, we’ll have proof of principle that a small group of writers and editors can be paid directly by readers, and that an independent site, if tended to diligently, can grow an audience large enough to sustain it indefinitely.”

Can Sullivan survive on reader subscriptions alone?

In a sense, this is the same kind of transition the New York Times and other media entities are trying to engineer, where reader subscriptions become the primary method of monetization rather than advertising. But while the NYT has been having some success in that department, the jury is still out on whether that model will work for others — or whether, as the authors of the recent Tow Center report on “post-industrial journalism” argued, the Times is such a unique proposition that it can’t be imitated by more than a select few (and at least one observer has said that Sullivan himself is the blogging equivalent of this problem).

The state of journalism as described by the Tow authors — media theorist Clay Shirky, journalism professor Chris Anderson and Tow Center head Emily Bell — is a landscape where the major media entities in virtually every field are being disrupted and unbundled, and where smaller players targeted at specific niches stand the best odds of success. It’s an almost Darwinian view of the industry, with slow-moving giants who are gradually replaced by more nimble and flexible species. And it’s also a more personal and human-sized approach, one that Sullivan clearly sympathizes with:

“We believe in a bottom-up Internet, which allows a thousand flowers to bloom, rather than a corporate-dominated web where the promise of a free space becomes co-opted by large and powerful institutions and intrusive advertising algorithms.”

The model Sullivan is banking on — which features a $19.99-per-year subscription, free incoming links from blogs and social media, as well as a “pay whatever you want” donation option — is similar in many ways to the freemium or membership models other sites have staked their future on, including Mike Masnick’s tech-opinion and analysis site Techdirt and Josh Marshall’s political news and opinion network Talking Points Memo. But while those sites are offering extra features for members (such as member-only discussion forums and access to extra content, etc.) Sullivan says non-paying readers who merely follow links to his content will get exactly the same thing paying readers do.

Do paywalls work better when they are for individuals?

In other words, Sullivan is betting that his personal brand and goodwill with his readers is enough to convince a substantial proportion of them to fund his writing — a more sophisticated version of the “tip jar” model. And within minutes of his announcement, dozens of prominent Twitter users and other Sullivan fans had announced that they had already signed up. As Laura Owen notes in her post, this could have a potential impact on The Daily Beast’s attempts to launch its own subscription model: what proportion of its readers would rather donate directly to support an individual writer, rather than have a blanket paywall around all the magazine’s content?

In a sense, Sullivan’s approach — if it works — poses a potential threat to traditional media entities that have built their businesses on strong personal brands: there has already been speculation that statistics superstar Nate Silver of the 538 blog might quit the New York Times to go it alone, and other name-brands at that newspaper and others might decide to take a similar route. Just as a growing number of authors have been cutting out the middleman by self-publishing their books, a membership model could mean independence for columnists who have traditionally been shackled to a large media entity (although some skeptics believe Sullivan’s move is more about self-interest than about a principle).

Even that model contains its own problems, however. How many individually paywalled or subscription-based sites will readers want to sign up for? Every Sullivan-like success story could make it increasingly difficult for others to follow in his footsteps. But for now at least, the Daily Dish blogger’s move is a very prominent thumb in the eye for traditional media players — and a flag of hope for every writer who has dreamed of building his own mini media empire.

Post and thumbnail images courtesy of Shutterstock/Africa Studio and Flickr user jphilipg

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Chittum makes it obvious where he believes the rhetorical goal-posts lie by opening with an anecdote about a Japanese soldier who was sent to the Philippines during World War II and told to “live on coconuts” if he had to. The CJR writer then compares paywall skeptics (including yours truly) to the Japanese army, and says their advice amounts to telling newspapers to live on coconuts. Later, Chittum says that their proposed treatment for the sick patient known as the newspaper industry is like recommending that doctors use incense and leeches instead of modern medicine.

Is this really the same as World War II?

The CJR writer also argues that members of the anti-paywall camp are “stuck in the mid-2000s, ignoring the events of the last few years,” as well as dismissing the innovative experiments conducted by newspapers like the Washington Post that don’t have paywalls. And he refers to various elements of the “catechism” that are the core beliefs of the “FONsters” or Future of News brigade — a group that includes author and journalism professor Jeff Jarvis as well as media theorist Clay Shirky, journalism professor Jay Rosen, and Digital First Media staffer Steve Buttry. Says Chittum:

The war is over. The evidence is in. Newspapers, large and small, premium and not, gain additional revenue through subscriptions and lose little if anything in digital ads. The Allies have won.

If nothing else, the strength of the rhetoric on both sides of this debate reinforces just how high the stakes are: the question of how newspapers and other traditional media outlets can (or should) pay their way in a predominantly digital age has gone from being a topic for light-hearted cocktail banter to a life-and-death issue for many companies. The market-leading New York Times is going through its fourth round of buyouts in five years, the Cleveland Plain Dealer is talking about a 30-percent cut in staff, billionaire Warren Buffett — as big a fan as newspapers have right now — is closing down titles, and some companies have gone bankrupt not just once but twice.

In that context, I can see why tempers might get a little heated. I spent some time recently with a senior digital executive at one of the largest newspapers in Canada and the frustration he felt was palpable: print advertising revenue continues to drop at a precipitous rate, digital ad revenue is not making up the difference, and mass layoffs are a painful thing at the best of times — especially when you know and admire all of those involved. So I am not unsympathetic to the CJR’s position, which seems to be that paywall critics are whistling past the graveyard.

Not should you charge, but whom — and for what?

As I’ve tried to explain, I am not against making people pay for things, including content — we charge people for plenty of content at GigaOM, including our proprietary research and our events. So I am in favor of charging readers: the big questions are which readers, and for what, and how. And I don’t think the answers are obvious.

Chittum and others assume that because I’m not a fan of blanket, one-size-fits-all paywalls around commodity news (for a number of reasons — both personal and professional — that I have outlined before) then I abhor any kind of paywall and wish newspapers would just give away all their content for free until they go down in flames. In other words, the only available options that are open for debate seem to be a blanket paywall or no subscription products at all.

But what about a membership model, the kind that some smaller sites such as Talking Points Memo or Pando Daily are experimenting with? This is something close to the “reverse paywall” or velvet-rope approach, where loyal readers are encouraged (and in some cases even volunteer) to pay for things. Do I have conclusive evidence that this could generate $100 million annually, the way the NYT paywall allegedly does? No, because no one has been doing it for long enough to prove that. But I will argue that it makes for a more rewarding relationship with your customers.

I don’t think anyone has a magic recipe that will return the newspaper industry to its former glory, for the simple reason that this is impossible. The news business has fundamentally changed, and returning to some mythical past is just not in the cards. Will charging people for the news help? It seems to have for some newspapers, although not for others. But that doesn’t mean we should give up looking for other solutions as well — and one of my main criticisms of media outlets with paywalls is that they seem to lose interest in pursuing other potential strategies.

What I would really like, however, is for everyone involved in this debate to be able to talk about the various options and alternatives without having the whole thing degenerate into a religious battle over who was wrong first, or who is more out of step with the times, or who resembles the Japanese Army in World War II. That doesn’t really help anyone, least of all the newspaper industry.

Post and thumbnail images courtesy of Shutterstock/Nickola Che and Flickr users Zarko Drincic and Giuseppe Bognanni

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Longreads offers membership for $3 per month or $30 per year and until now the only perk has been the good feeling that comes from supporting the site. In addition to exclusive content, members will “have the chance to recommend future Longreads Member exclusives. Tell us what you want to share with your fellow members (it can be a story, an excerpt, or something completely different), and if we like it too, we’ll find it and feature both you and your pick.”

“Our paid membership is still relatively small compared to the size of our overall community,” Longreads founder Mark Armstrong — who is also the editorial director of read-it-later service Pocket — told me, “but it’s grown enough over the past year that we wanted to start sending more perks to our members as a thank-you.”

The first exclusive is chapter six from Charles Duhigg’s bestselling book The Power of Habit. Longreads is licensing the chapter from Duhigg’s publisher, Random House, and will license future exclusives as well.

Other websites are also experimenting with content perks for paying members. My colleague Mathew Ingram recently wrote about tech commentary site Techdirt, which gives paying readers early access to blog posts, as well as other membership benefits.

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The site, which is run by founder Mike Masnick through a company called Floor 64 (Full disclosure: I consider Masnick a friend) has had an online store for some time now where readers and fans could come and buy the usual type of swag many publishers offer, including e-books based on the site’s coverage. But the store has now been updated with some new features, including the ability to buy lunch with Masnick (for $250) and to do a Google Hangout with him.

There’s also a couple of humorous offerings aimed at critics of the site — including one that allows the buyer to shut the site down completely for 24 hours, for only $1 million (shutting it for a year will cost you $100 million).

Techdirt has also expanded an interesting offering called Crystal Ball: originally launched in 2009, it gives readers who sign up for a specific level of membership access to blog posts before they are published. The new version expands the amount of time they have to read — and even comment on — these posts, to two hours instead of one. And readers who pay can now see posts that are in draft mode, before they even reach the stage where they are ready to be published. Do many readers sign up for this feature? Masnick says there have been about a thousand since it was first offered, which isn’t huge but is still noteworthy.

I criticized a similar idea that Felix Salmon of Reuters came up with earlier this year, which was that the New York Times should charge hedge funds for early access to market-moving news stories — but the crucial difference is that Techdirt provides almost exclusively commentary and analysis, not breaking news. So why couldn’t the NYT take a page from Techdirt’s playbook and offer expanded access to things from writers like Nick Kristof or Paul Krugman? I think there could be a pretty big market for membership-level access to that kind of thing, and the NYT has already moved in that direction by offering enhanced commenting features to members.

Members get credits for voting on comments

Techdirt also launched a new commenting feature for paying members: called “First Word/Last Word,” it allows members to acquire credits with which they can vote up comments that they think are worthwhile and vote down those they don’t. Reinventing comments is something plenty of publishers are trying to do, including Gawker publisher Nick Denton — who tried a membership-based voting model and then more recently abandoned it for something he hopes will turn the site upside down and make comments the most important part of the content, as opposed to the posts from writers and editors.

As Masnick notes in a blog post announcing the new offerings, the site is trying to follow the advice that it often gives to musicians and other artists (copyright and the death of traditional content business models being one of the site’s favorite topics). That advice is to connect with fans, and then give them a reason to buy — so instead of relying on CD sales or record deals, Masnick advises artists to take an approach like independent musician Amanda Palmer did recently, in which she Kickstarter-funded a new album and tour with a campaign that raised over $1 million in a matter of days.

In a lot of ways, what Masnick is offering readers is a similar kind of model, but without the help of Kickstarter. It’s the complete opposite of the approach most traditional media companies take, which is to charge their readers a blanket fee for their content, regardless of what that reader might be interested in. Some publications take a membership-style approach, including magazines like the Economist, and The Guardian — which is adamantly opposed to paywalls — has been experimenting with offering certain features for pay, such as a new “freemium” approach to photos as my paidContent colleague Robert Andrews described in a recent post.

The new CEO of the New York Times may not want to offer Google Hangouts to readers any time soon, but I think there is a lot of value in treating your readers like members of a fan club rather than just a homogenized sea of faceless readers whose only option is to pay a monthly fee. Offerings like Techdirt’s may not generate billions in revenue, but they help to cement the bond between a content producer and his or her fan base — and that can be a very valuable thing indeed.

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