Andy D Day

Why Content Behind The Paywall Won’t Work… For Everyone

There’s been a huge amount of discussion going on about how News International, Microsoft and a local newspaper group are going to kill the newspaper industry cold stone dead over the next year or so as they move to put their content behind paywalls so that the general public will only have access to “credible” journalists work if they’re willing to cough up either a subscription or a per article micropayment.

There seems to be a chasm dividing the two camps of agreement on this issue. Over on the right wing we have self appointed keepers of quality media who claim that their huge conglomerate businesses can’t survive unless they start charging punters instead of giving away their hard earned work “for free”. Over (and I mean a hell of a way over) on the left there are the information-wants-to-be-free brigade who seem to think that journalism is something that can be done by anyone with little training and has little or no real financial value. Some of these far lefties even seem to think that Twitter replaces real news coverage. (UPDATE Twitter doesn’t replace real news coverage!)

But as is always the case, in reality, things aren’t so black and white. As I’ve already discussed on the Giant Digital blog there could already be a marketplace for 4 million paying online newspaper customers in the UK alone, not to mention what size that market could be internationally. Certainly, a walled content garden could be worth millions of dollars annually for a company the size of News International.

However, this approach will not work for everyone. A regional newspaper group Johnston Press are also set to take their online content behind a paywall and players of this size are going to utterly kill their chances of increasing their revenue by closing off their local coverage from the outside world. Johnston Press sell their local weekly newspaper for 45p a shot and plan to charge a three month subscription for £5 providing (as pointed out by one of their employees) a massive saving of 40p over a three month period. When the BBC provide exactly the same coverage for free it’s unlikely that anyone is going to cough up any amount, however small that is for local news.

For huge media outlets with trusted brands (whether they should be trusted or not is a different matter) there will be an audience who will be willing to pay a small amount of money to continue to get news from their preferred sources, but for many brands that have always been online, the websites that I own included, there will not be the willingness by the public to suddenly start paying for content. Not that our content carries less value or influence, but users are very unlikely to pay for news from these sources after getting them for free for years. It is way too easy to go somewhere else for something similar and free.

This whole plot line reminds me of the music industry’s bid to get downloaders to pay for content they’d been consuming for free, which has probably been compared to death by now (and we all know where that story ended up, with multinationals charging us for music), but maybe less obviously of the bottled water industry which also caused a stir when it first started out. I can remember when the very concept of buying a bottle of flavourless water in a clear plastic bottle was seen as utterly ridiculous. “This will never catch on”, “down with this sort of thing” people used to say. Bottled water industry, worth $146.5 billion last year. Makes you think, huh?

Rupert Murdoch and chums will be laughing all the way to the bank on this one, but that’s cool because there will be a whole slew of people who will prefer to consume news for free that used to frequent NI et al’s websites who will be browsing on news sites that were born and bred on the internet and that means more advertising revenue for smaller/newer companies like mine. And of course, the mugs readers who have coughed up their subscriptions for newspaper+ will still be using the rest of the free internet after their 5 minutes of “proper news”. Surely a win-win for all concerned.