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Another wall tumbles: The Dallas Morning News dismantles its paywall, tries to sell premium features instead

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When the San Francisco Chronicle said that it was demolishing its news paywall in August, we wondered whether it might be the beginning of a paywall rollback trend. Now a second metro newspaper has decided to go the same route: the Dallas Morning News announced that its news content will once again be free to all web visitors starting on Tuesday, October 1.

Much like the SF Chronicle, the Dallas newspaper said it will continue to offer a premium service to paying readers, and it hopes to add more unique features to that service in the future, such as customization and access to events.

Not enough interest in digital subscriptions

In a comment to a reporter from the Morning News, the chief marketing officer for the paper — which is owned by A.H. Belo Corp. — was fairly blunt in his assessment of the paywall’s benefits, or lack thereof. Unlike successful paywalls at newspapers like the New York Times, the one at the Morning News didn’t generate much return, CMO Jason Dyer said:

“The pay wall solution hasn’t worked. The pay wall didn’t create a massive groundswell of [digital] subscribers.”

So what Morning News readers who decide to pay $11.96 per month will get access to instead is an “image-oriented, collage-style display” of the news — one that appears to be inspired by tablet-based content offerings such as Flipboard or Pulse, and is also similar to the new site Topicly that was recently launched by the Washington Post (although it is free).

Dallas Morning News

The Morning News paid site will also have fewer ads, the newspaper said. According to publisher Jim Moroney:

“In the first quarter of 2011, we became one of the first daily newspapers to ask consumers to pay for the content we distributed digitally. Now, we are going to experiment with another approach.”

Readers don’t want to pay for news online

Moroney said that research the newspaper did with print subscribers showed that what readers were willing to pay for wasn’t the actual content itself, but the method of delivery — that is, the printed newspaper. When offered the exact same content online for a price that was 90-percent less than the average print subscription rate, only five percent of readers said they were interested.

“What we concluded from this research was that subscribers were not paying for the content, so much as paying for how they wanted to consume the content we published. They were paying for a print experience. Now, we want to see if there are sufficient consumers who will pay for a premium digital experience.”

The Morning News says that in addition to a more visual browsing experience, readers who pay for the premium content will eventually be able to personalize the content they receive and will also have access to a “loyalty program” of some kind that could include access to events and tickets to baseball games. Early responses to the new strategy were not kind, however:

This post was updated to reflect the fact that the premium version of the Morning News doesn’t include extra content but only premium features or services.

Post and thumbnail images courtesy of Shutterstock / flyinglife

30 Responses to “Another wall tumbles: The Dallas Morning News dismantles its paywall, tries to sell premium features instead”

  1. I would never pay for on-line subscriptions when there are so many good options for free news on the internet. Plus, I like to read opposing views of bloggers, etc. to gain a better perspective versus reading the DMN where it seems they take advantage of people that see them as an unbiased reporter of the news. The DMN is struggling is other ways too. I switched from a credit card subscription with auto-renewal to a set period of months with the idea that I would probably let the subscription run out and not renew. The paper stopped coming one day and I assumed the subscription ran out. Not too long after I received a collection notice from a third party. The DMN didn’t even let me know they felt I owed them money because they kept delivering for a few weeks after the subscription ended. I have perfect credit and have never dealt with a collection agency so it was a shock to read threatening letters. I suspect the DMN is treating other readers, or past readers, the same way, which is slowly killing their brand. I remember the days of the Dallas Times Herald.

  2. wiss2012

    I a a digital subscriber to the Austin American Statesman. I A female,60 years old, living in a rural county near Dallas and who won’t drive to the local Walmart on a Sunday to get old news and coupons. I can buy for the coupons on any day of the week as papers are still sitting there.

    I found that the issues reported on by the DMN on scandals at the school board,the county commissioner’s court,and the jail are still using the same format as it was 20 years ago, just change the names and dates. A new fresh of eyes is needed to see if they can be reported in a fresh manner. The reporting of the Dallas City Council has improved over time, just limiting what is being reported on.There are no columnists that I want to follow though over time, the photography has been wonderful.

    I paid the subscription price for the AAS because their reporters offer in depth reporting on the Texas Legislature and Committees during the OFF legislative years as well as when the Legislature is in session. They follow water, transportation, and oil issues not just personality issues on the committees’ work.. I like that they have a paragraph format like Virtual Capital to look at prior to reading the in depth article for me is great.. I also purchased it because I like the columnists point of view. This doesn’t mean I agree with their viewpoints but it is a well reported viewpoint. I feel the same way about the online Texas Tribune. Using the technique of offering in depth reporting paragraph to tease the reader into reading the indepth article, since I found myself wanting to continue reading the article, was another factor in buying the subscription.

    I can’t tell you if this method makes a profit.

  3. graphicsully

    Having worked for the digital department of a very successful printed newspaper in central PA that I left because of what Clayton Christiansen called the “Innovator’s Dilemma”, I was no surprised by the DMN paywalls failer.
    Newspapers have two choices. Either strictly control their content, hire an army of attorneys hunting down all plagiarizing and maybe outsource some content management or open the flood gates and offer as much free content as possible to generate page views. This would include a craigslist type classified listing. Push all paid advertising to “in content” ad space so that it can NOT be blocked and is viewed as premium placement. Half of all newspapers sold were for the advertising. Craigslist is nothing but advertising.
    Newspapers just couldn’t except that they lost classifieds and now they are refusing to except the loss of paid subscriptions. Stop being greedy! It is a new world and all that is left is viewership. You still have retail, milk it for whatever you can.

  4. Everyone knows that a car crashed on Second Avenue yesterday, but who were the victims, how badly were they hurt, what hospital were they taken to…weeds. A reporter is needed to report the details and a well paid one too…

  5. Dennis Spaeth

    As long as enough news organizations provide free access to news online, paywalls will be a tough sell for every newspaper. Don’t think for a second that it’s been easy for the The New York Times or the Wall Street Journal. They’ve been at it for years. Though it is true, as another commenter noted, they provide news not often found anywhere else, the main reason they have been successful so far — I would suspect — is that they stuck with the plan. I think Dallas and San Francisco screwed the pooch.

      • Cynthia & Bunny

        oh, and ease of using internet features such as incognito/private browser windows, clearing cookies, following Twitter accounts like @freeNYTimes, putting articles titles into google search, etc?

    • Dennis,

      I agree. If your news offering is simply stuff that’s available anywhere then you provide no value and frankly you should just pack up (which is why the online aggregating, slicing and dicing model has no future -it’s just short-term parasitic behaviour). Any “real” news organisation prides itself and focusses on creating unique relevant and trustworthy content which has a value and therefore people will pay for it. Yes it’s a long haul to change ingrained habits but it’s well underway.

  6. Before the anti-paywall tech brigade start getting carried away one very important factor, which has been mysteriously overlooked, needs to be pointed out. DMN introduced a HARD paywall which is very rare and a completely different model from the ubiquitous metered paywall which is being successfully rolled out across the world. The key difference is that with a metered paywall you can have the best of both worlds (lots of visitors = ad revenue AND subscriptions).
    It’s difficult not to note the celebratory tone of the article (and the comments) and they make me wonder if anyone working for or reading paidcontent actually believes in the concept of professionally created/curated content ? If not I think they have a responsibility to explain how they believe quality content will be produced in their world. And please the answer is not advertising alone (other than for those with enormous global scale), if it was don’t you think someone would have made that work by now ?

  7. Cam Ellison

    This is the first assessment of what people will pay for that I’ve ever read that I totally agree with. It’s the way it is delivered that people will pay for. This totally is IT for me. Yes, I would pay for a digital format I like and that makes organizational sense to me and looks good to my eye. And, for a printed newspaper.

    I don’t like the digital image of the printed paper other than so that I can see what it looks like and what they put out front and what they buried in the back. If the same can be accomplished with a flipbook look – it would make me very happy.

    People will pay for physical products on line – one that will be delivered that they can hold in their hands in the real world. Even apps for a phone or tablet because it goes onto something they hold and they will then own it and be able to use it just as they can use pens and paper and tools in their house. And they will pay for online services like cloud storage, streaming movies, and books they will then own they can read on Kindle. But they wouldn’t pay for, say, a picture of a camera that they will never hold in their hands or be able to use.

    I don’t think newspapers get that yet. Except for this one. I think the guy who figured this out is a genius. I hope he shares his wisdom with every other newspaper in the country. He can start with, where publications and writers come together.

  8. As with most initiatives in business, 90% is in the execution. The data on best practices from the 450 publishers with paid models powered by Press+ say that the previous Dallas Morning News approach of a paywall–meaning that the “best articles” can only be read by paying subscribers–is not nearly as effective as a meter, which enables everyone to sample the best journalism, become engaged over time and based on usage eventually be asked to pay for full access. Press+ has found that the meter works brilliantly for newspapers of all sizes and for digital-only publishers, especially when readers get “all-digital access,” meaning full access to every digital version at one simple price, including web site, iPad/iPhone, Android, mobile, replica, etc. We wish the DMN well with its new approach, but the proven model is a simple meter only ever asking the people who get real value from a news brand to pay for full access to all digital versions.

  9. Let me count the ways that I am impressed by the Dallas Morning News:

    – They admitted, bluntly, that the paywall didn’t work. The newspaper industry has a long habit of never admitting strategic mistakes, especially one as big as a digital paywall. Kudos for trying something, and then stopping it when the evidence was clear that it wasn’t working.

    – They came to the conclusion that subscribers are paying for the experience of a printed newspaper, not the news inside of it. I’ve been arguing this point for years, but most who work in newspapers — and especially newsrooms — don’t want to hear that the experience of the full printed package, rather the news contained within, is what gets people to open their wallets.

    – They promised to continue to try new things. Do I think their new “premium” content, essentially a photo navigator of the news, will get people to pay? Not a chance. But the path to innovation always involves some less-than-stellar ideas along the way.

  10. Perry White

    Perhaps newspapers should consider the very successful paywalls — the New York Times, the Wall Street Journal — are by truly national and international newspapers whose audience stretches from sea to sea and beyond. The Dallas Morning News, as cosmopolitan as it may view itself, is at best a regional paper. As is the San Francisco Examiner. If local newspapers put as much effort into improving their print products and showing advertisers the very real advantages of print advertising as they do into trying to invent the perfect paywall, we might find that the decline of newspaper readership can be stemmed.

  11. News agencies need to follow the example of the Huffington Post. You are not selling the news, you are selling advertising to advertisers who count on you to use the news to generate audience.

    Therefore, your top priority as a news agency should be to generate and aggregate that audience. Make your website interactive (to retain their attention longer) and then earn revenue from PPC advertising.

    Money is not going to come from subscriptions in a digital age. It is going to come from page views, impressions and advertising revenue.

    Lori Sheppard
    McKinney, Texas

  12. “Reader’s Don’t Want To Pay For Online News”

    Actually, I think many people woudl pay for it. However, no one wants to be tied into paying for ALL of one news outlet’s content. I’m not going to pay $11, $12, $15, or $20 for the few articles I’ll read from the Dallas Morning News or Forbes or any other site.

    If there was a simple way to pay a small amount for content behind paywalls, I’d do it. Publishers need to realize their articles aren’t work $1 or $.50. Maybe $.02 to $.05. Allen Stern (RIP) from CenterNetworks and I had this discussion a few times in the past.

    I know there was one micropayment service that was available but led to controversy about where the publishers actually got paid. If major publishers could come together with a single micropayment system, I’d happily sign up. Perhaps a text to pay scenario. Visit a website, open your payment app, get a payment token, enter it into website, and tada you have the content. This way, there is no logging in, no third party cookies, no tracking between publishers.

    Maybe I’m in the minority, but I’d be okay with this.

  13. I reckon the best strategy for a newspaper is to look at how much it can get from redeveloping any buildings and land it owns, sell its subscription database to direct marketers and close down before losing any more money.

    • No, not really. Theirs was a HARD paywall which was always doomed to fail. The model that is being successfully rolled out across the world is the metered paywall as pioneered by the NYT.