The Times will add Paywall in June

[HarryT]

Originally Posted by Nate the great

I didn't say that I deserve to get it for free. I said that I would get my news elsewhere. There are many free sources of news; much of it identical. There is actually very little that The Times produces that can't be found elsewhere, and that very little isn't worth paying for.

But, with respect, the fact that you personally don't find it worth paying for does not mean that other people won't. "The Times" is a newspaper with an excellent journalistic reputation, and for many people it very likely will be worth paying for, especially if it's an alternative to buying the printed paper. £2 for a week's subscription is excellent value compared to the £1 per day (and £1.50 on Sunday) for the printed paper.

[weateallthepies]

Originally Posted by HarryT

But, with respect, the fact that you personally don't find it worth paying for does not mean that other people won't. "The Times" is a newspaper with an excellent journalistic reputation, and for many people it very likely will be worth paying for, especially if it's an alternative to buying the printed paper. £2 for a week's subscription is excellent value compared to the £1 per day (and £1.50 on Sunday) for the printed paper.

Whilst people no doubt will pay for it, I think they and maybe you overestimate just how many people that will be.

It would be interesting to know what sort of figures they are going to need to improve on their current ad based revenue. Once the current X million hits dwindles to several hundred thousand the advertising revenue will drop.

I think they will struggle whilst there are over respectable free alternatives like the Guardian and Telegraph. Sure they'll hang on to a core audience devoted to the paper but they'll lose loads of casual readers.

[K-Thom]

The only ones who "deserve" to be paid are the news agencies like Reuters, AFP, DPA. They are actually doing the work. Those I would pay as a reader.

If a newspaper offers some exclusive investigative article, this may be added as payable content to an otherwise free site.

It's Murdoch's decision. Time(s) will tell if it works out. Murdoch tried payment methods before, didn't work. Murdoch tried ads revenue. Did work to some extend. He tries payment methods again now. He simply has no long-term strategy.

[charleski]

Conventional online advertising has far less impact and pays far less than print ads, no point debating whose 'fault' that is () - it's a function of the medium. Newspapers obviously have to work out a method of surviving in this environment, but I doubt that simply adding a paywall to a website is the way to go. As can be seen from some of the comments here, the flawed notion that online resources magically appear from thin air and should therefore be free is widely entrenched.

They really need to move to a substantially different model to alter both the experience and the expectations. The iPad is certainly a better choice of platform for providing rich media delivery with the sort of focussed, high impact that advertisers will pay for. And as I reported earlier, the ad-sales prior to launch are looking hopeful. But publishers really need to have a strategy like that in-place and get readers to move to an alternative platform before clamping the online version to protect sales. I suspect that is what we'll see with the NYT - the paywall will go up once the iPad version is doing well.

[ardeegee]

Originally Posted by Harmon

The question is, why not? I mean, we are willing to buy a newspaper at a dollar a day, so why not a webpaper?

The number of people willing to pay for a physical newspaper is plunging all the time. Most paper newspapers are in a death spiral. The last time I subscribed to a physical paper (maybe around 8 years ago) the cover-price was 50 cent M-F, $1.50 S, or I think around $3.50 a week for a subscription. No way I'd have been willing to pay $1.00 a day. I marvel at how much my local newspapers have shrunk since then in the rare instance that I encounter a copy-- the bigger paper is maybe 1/3 the number of pages, while the smaller one has shifted to tabloid size and is even less content. But the prices stay the same, even though now I wouldn't rate them as worth even 25 cents a day.

[rhadin]

Originally Posted by K-Thom

The only ones who "deserve" to be paid are the news agencies like Reuters, AFP, DPA. They are actually doing the work. Those I would pay as a reader.

That isn't quite true. For many newspapers it is, but there are a few who have their own correspondents and do their own reporting.

[HarryT]

Originally Posted by rhadin

That isn't quite true. For many newspapers it is, but there are a few who have their own correspondents and do their own reporting.

And "The Times" is certainly such a paper.

[Conor]

I wonder how it will be paid? People aren't used to paying for anything in that price range other than by cash. What about the processing charges if you have to pay by credit card?

[petermillard]

Originally Posted by Conor

People aren't used to paying for anything in that price range other than by cash...

You're kidding, right? The iTunes store and App store? All those 99c songs and apps weren't paid for by cash...

I expect they'll set up some kind of 'one click' system - like Amazon, Apple etc...

Cheers, Pete.

[HarryT]

Originally Posted by Conor

I wonder how it will be paid? People aren't used to paying for anything in that price range other than by cash. What about the processing charges if you have to pay by credit card?

What processing charges? Providing you're not paying in a foreign currency, there are no processing charges from the customer's viewpoint.

[Kali Yuga]

Originally Posted by gastan

To say, as bookwerm does, that subscribers pay for producing articles and content and pay reporters salaries is stretching the truth a bit, IMO. At best subscribers pay for paper stock and distribution costs...

Incorrect.

If your analysis was even remotely correct, newspapers would flourish during the transition to an online model. As paper circulation fell, paper costs would also fall (or they'd charge more), more readers would go online, and business would be through the roof. The reality does not remotely resemble this rosy scenario.

Online revenues (which, at this point, are almost exclusively ad revenues) are only around 10% of the industry's total revenues. So even at this stage, 90% of newspaper's revenues are print subscriptions and print advertising; however, it is highly unlikely that 90% of the paper's costs are just print-related. That's a fantasy of people who think they are paying for a physical object, when the reality is that it's the labor -- journalists, photographers, editors, proofreaders, layout, designers, ad sales, marketing etc -- is a huge chunk of the costs.

Newspapers also used to make good revenues from classifieds, job listings and real estate -- all of which have largely migrated online, and often to other companies (e.g. Craigslist, Hotjobs etc). That's all gone and highly unlikely to return.

Originally Posted by gastan

Since there will be no paper or distribution costs with a digital edition I cannot see any moral reason to charge for a digital edition.

Online subscriptions are actually fairly lucrative. For example, in 2008 the Wall Street Journal was the 5th largest online news site with 5.4 unique visitors per month, and generated $60 million in revenues. If they eliminated the paywall, they would have needed to have over 20 million unique visitors -- which seems unlikely, given that the largest newspaper site at that time was the NY Times, with 17m unique visitors per month (and aggregators like Yahoo were hitting 35m or so).

Also, there is absolutely no reason, moral or otherwise, why price needs to be linked to cost -- or more accurately, your misperceptions of costs. E.g. If I want to charge $100,000 for a painting that only cost me $5,000 in materials and labor (e.g. assistants), and someone is willing to pay that price, there's nothing immoral about that transaction. And it doesn't matter if this is one individual or a corporation; barring deception or abuse of a monopolistic position, the "right" price is "what the market will bear."

In fact, one could suggest that the public have been a bunch of moochers who have taken advantage of free news for a decade or so, while newspapers struggle to figure out how to function in an online world. Someone is paying for the articles you read, so why not pull your own weight for a change, ya freeloader?

Originally Posted by gaston

They will still be garnering advert revenue but not incurring any delivery costs.

Unfortunately, online ad revenues are miniscule (again, about 10% of total revenues). This revenue source also collapsed in 2009 by 30%, by the way.

And while web is definitely cheaper than paper, it's nowhere near free. You need servers capable of handling millions of requests per hour, power and staff for those servers, a small army of web designers, lots of security, and most will need to maintain tons of data for file archives.

In short, newspapers simply cannot survive off of online ad revenues alone. This is why the industry is hemorrhaging -- and I suspect will turn more and more towards paywalls in order to survive.


On a side note, I notice that people tend to adore the idea of online ads subsidizing their newspapers, but many utterly detest the idea that book publishers would sell books for free but load them with ads. I don't think any specific individual is contradicting their positions, but public opinion certainly seems to be in conflict on this point. Hmmmm.

[SensualPoet]

I agree The Times has unique content that might be "monetized". But I still believe this is a short-sighted model and ultimately damaging to the "Times brand" in the long term.

The value of a newspaper lies in its reputation and that only is maintained if the newspaper is seen and heard on a daily basis. Placing the majority of content behind a pay-wall degrades that reputation over time by being seen less.

Some papers, and I believe The Times is adding this "feature", think tying free web access to physical newspaper home delivery is a good idea. But that limits who gets access and once again degrades the reach of the newspaper's reputation.

Newspapers have at least five qualities that set them apart from other news sources: 1) archives, recent and historic; 2) columnists, house journalists; 3) geographic, political "anchor"; 4) aggregation and filtering of daily news; 5) print advertising, local and national. It's easy to prove; here are some quick examples.

1a) Archives, historic - the coverage of local events in the 1850s and 1930s -- The Times, the New York Times, the Chicago Tribune have unique offerings.
1b) Archives, recent - the coverage of any events over the past 2 weeks or month -- different voices and POV that is still relevant to the unfolding story
2) Columnists, house journalists -- not the syndicated voices but the ones tied to the press's imprint -- you want to read Woodward and Bernstein at the Washington Post first and in any case these are the folks, some much less famous, which set the tone of the publication and its appeal for you
3) Geographic, Political Anchor -- a paper is valued because it reflects a British or German or Canadian POV -- what are they thinking in Singapore from a Singapore POV?; the same argument applies to liberal and conservative (vis. The Times vs. The Independent)
4) Aggregation -- it's not willy nilly. "I read it in the New York Times so it must be true!" (or untrue ...!). This is partly reputation and partly expectations of what one is likely to find. The Huffington Post vs BBC News Online vs New York Post ... it's possible they will all report on the same story but the collection of stories of the day will be radically different. What's important to the press at hand -- the filtering in the aggregation process -- is what drives value.
5) Print Advertising -- often left out in online editions, they survive in pdf "whole newspaper" editions and include display ads from businesses, advocacy advertising and classifieds including personals.

Remove any of the above from sight through a paywall and, bit-by-bit, you risk eroding the reputation and long-term value of the newspaper. Reputation isn't a "nice to have" -- it's also the gold which brings access to the inaccessible. Who's phone call is likely to be returned first at the White House? The New York Times or the New York Post?

Monetizing these different aspects of a newspaper's online edition is tricky and no one has found a solution. But one principle ought to guide the bean counters: less is not necessarily more. Tread with caution and charge where you can add value to the consumer experience without hacking away at the foundations of the press itself.

[DawnFalcon]

Originally Posted by Kali Yuga

In short, newspapers simply cannot survive off of online ad revenues alone. This is why the industry is hemorrhaging -- and I suspect will turn more and more towards paywalls in order to survive.

Then they're in trouble. It's been shown over and over on the web that you only get a very small minority of your users to subscribe when you're using a paywall, and citizen journalism can provide the vast majority of the news.

The only way "around" that is to attack citizen journalism.

[Ben Thornton]

UK newspapers also have to sell the idea that they provide a significant benefit over and above the BBC's news service, which is funded by tax-payers and TV licenses. The BBC don't produce a newspaper per se, obviously, but on-line there is arguably little difference between what The Times and BBC News are offering.

So, in the UK, I think that charging for on-line newspapers will be (even more) difficult to sell.

[DawnFalcon]

Just in the UK, Ben? I'd point out that BBC has extensive worldwide coverage, too...

(And of course the newspapers /are/ attacking the BBC licence fee, but fortunately that one falls flat, heh)