Paywalls. Why The Thunderer is right to charge online

PEOPLE much smarter and more wired-in than me have been up in arms over the fact that both The Times and Sunday Times are going behind a paywall from June.

They make good, well reasoned arguments about why it is doomed to failure, of how you can’t put the Genie of free content back into the bottle once it’s popped, and they might very well have it sussed.

The thing is, I actually think it’s a good idea.

Indeed, I’ll probably be among the first to sign up for the Thunderer when it does. More so, I think the industry naysayers belittling the idea will have no option but to follow suit.

Despite the cacophony of derision being lobbed in Rupert Murdoch’s general direction, I believe he is leading a revolution that could become something of a saviour for quality news coverage.

And I hope so. The print model cannot cope on its own, it is no longer the first choice of either readers or advertisers. If the industry stands back and does nothing to replace the lost income, it will be crippled.

There are those who argue that putting content behind pay gateways in some way erodes democracy. But by standing by idly doing nothing, those same critics are doing far worse, complicit in delivering the death of democracy through inertia. 

The fashion may be to knock the old man for his lack of Tweeting, Facebook profile or alleged aversion to email. (Because clearly a multi-millionaire media mogul waited on hand and foot needs all these new fangled products to understand them). 

But remember, he not only changed the face of newspapers in this country and beyond, but sparked a revolution in television too. So just why do few believe he can do so again? 

Murdoch already enjoys sizeable success charging for content at wsj.com. With his experience of the Wall Street Journal, he’s not exactly going into this blind. Few other publishers can claim the same. 

The cynics would be wise not to rush into writing off News International’s deep held ambition for making money from the web just because they haven’t quite got everything online right before.

Again, why the upset? Is it snobbery? Is it envy? Is it some kind of misplaced belief that we in fact live in some kind of perfect free news utopia.

Whatever it is, there are those who are ferociously opposed to the project.

Guardian editor Alan Rusbridger, as you would perhaps expect from a direct competitor, argues a paywall reduces the paper’s influence, that it somehow removes it from the way people connect with each other and isolates itself. 

But there must be a counter argument that states rather than simply winning a game of numbers brought to you by clever SEO and Google, by capturing those willing to repeatedly pay for content, is your sphere of influence not actually enhanced, rather than diluted?

These are not, after all, drive-by readers. They are investing their trust in you to inform, educate and entertain.

Rusbridger’s director of digital content, Emily Bell, follows the party line, suggesting that free news sites are in some way protectors of stimulating public debate, the gatekeepers to free comment.

For that part guardian.co.uk has for years lead the way in building large online audience and reader engagement, of which I’ve long been a fan. Again, their newly updated home page shows inspired evolution.

guardian.co.uk currently claims around £25million a year of so in associated advertising revenue.

But can and will that online stream of cash remain a constant with its “window shopper” visitors, or will media buyers prefer those users who chose to pay for their content? 

Scott Trust or not, it cannot go on claiming that making money through pay walls isn’t important, especially not if NI gets it right.

And following the successful launch of its own – paid for – iPhone app, some within King’s Cross have already hinted that they are looking at future subscription based products. 

The pressure to make money will be overwhelming. The Guardian cannot hide from that fact, no matter how hard it may try.

As for its argument from a democratic point of view, just because content is behind a pay-wall – does that really stop those reading or watching from participating in debate?

Indeed, surely those discussing what is behind the walled garden by default will become unwitting social media salesman by encouraging others to get involved and sign up.

If someone suggests I buy a newspaper for a particular story one day, then I’ll probably do so. Are you really telling me that won’t happen online, that we somehow lose the power of individual choice? 

Paywall isn’t a dirty word. We won’t catch some kind of virus, except perhaps Guardianitis if it continues to rail against it so and become tiresome.

Indeed publishers would do far better to agree a strategy for encouraging web subscription. 

Would more people be inclined to join in and pay if they could have some kind of Press Passport to dip in and out of online titles at the digital newsstand depending on their mood or needs?

But back to TheTimes.co.uk and TheSundayTimes.co.uk

At the most basic level, as a journalist and consumer, I’m very much looking forward to simply seeing how much TimesOnline changes in design and functionality when it launches the stand alone sites.

I hope it’s as exciting as the change for telegraph.co.uk was when they just embraced new media and evolved into the online stallion it is today.

I’m particularly curious to see what it will do with proposed Q&A sessions with its journalists, behind the scenes footage from the newsrooms, and its lunchtime live debates.

Times editor James Harding made it plain that it will charge for the bulk of its content. The staples, the stuff you can probably get anywhere, are likely to be available for free.

That’s just common sense.

If you can pluck a story from the Press Association, BBC or Metro for free, then it simply has to be available to your readers as a basic. 

But the analysis, the writing style, tone, politic, gravitas, columnist, blogs, even brand loyalty that comes with the Times – people will pay for that.

Why? Because they already do – in print.

And they will online.

Reader habits are changing, we are migrating online whether we like it or not. What NI has realised before most, is that some just need a little nudge in that direction.

The ABCEs will fall to begin with. But this is News International we’re talking about here. Marketing genius is not in short supply.

And they are not necessarily looking at the readers they have now, although that would be nice. It’s about the future.

It’s about those who will look to their mobile phones for the latest news, the newspaper in their pocket, which will one day see smart ads following their every trend. 

They may not even need to pay. The FT.com, for example, is about to launch its new App sponsored by another company in an attempt to pull readers online, a free trial before subscription.

It will be about those who expect to switch on their PCs or Macs each day and have their digital edition waiting and updated for them, complete with podcasts, video, live-streaming, debates, comments and instant messaging.

It will be for those of us looking forward to simulating the newspaper reading experience – but with all the whistles and bells – sitting on a train flicking through our near tabloid sized iPads.

Or the game-changer for me – touchscreen internet TV – which will allow you to do everything your PC, phone or iPad can do and more, all from the comfort of your own home. 

It is about convenience.

Newspapers were a populist, cost effective medium for years, the only mass communication platform available for their purpose.

That’s not the case now.

Facebook – which wasn’t even born until 2004 – is now a greater source for news than most. What about Google News?

News International will learn from their experiences, as could others.

Digital will not just be stand alone purchases to begin with. It will initially be included in all NI newspaper subscriptions too, allowing traditional fans to test drive the new online sites first.

And don’t just think about The Times and Sunday Times as story tellers.

Think of the whole multi-media, interactive package – and how they can build upon the niche groups they already have.

The Sunday Times, for instance, has 300,000 members of its exclusive wine club to be targeted already, along with the Times Travel Club.

Offers, tasting notes, holidays, review shows, blogs – all can be geared online to that specific group.

Ticket offers, invitations to exclusive events, reader discounts, complimentary upgrades through their travel club, unique content – all these will be deployed to ensure value for money.

The paywall plan will be replicated this across The Sun and the News of the World later too.

So consider that Sun Bingo has 250,000 registered users – all of them potentially ripe for the picking if they are prepared to pay for live-streaming bingo games as part of or on top of any subscription.

Or think about its Football Dream Team competition, described as being the largest of its kind in the world.

What potential might that hold pre World Cup 2010?

And then imagine how very much more attractive such a subscription for any of the four titles – or all of them – would be if rolled in with, say, a Sky TV package.

Down the line you will see how their news sites learns your habits and tailors the online product to your taste and throws in a few editor’s picks to widen the scope of your reading.

Even the advertising will be smart, specific to your habits, and that’s before you even consider eye-tracking technology and its ability able to react to every pause, stare or glance away from the page.

In terms of simple economics, such a paywall makes absolute sense for both publisher and reader.

As publisher, if they can persuade even a fraction of their current online audience to part with their hard earned cash, then immediately the NI coffers could be boosted to the tune of several million pounds.

The Guardian surmised that if TheTimes.co.uk/SundayTimes.co.uk could convert just 10 per cent of current daily users at £1 a time, it would net £3.66milion per month.

Handy when you are losing an estimated £240,000 day as Times Newspapers Ltd is currently.

Most users, you’d expect, would go for the £2 weekly pass, but still a sizeable chunk of change.

After all the printed product weekday and weekend currently cost £8.50. Who wouldn’t be tempted to make such a saving?

Especially when you consider how the Tim
es’ quality of journalism, and the investment in it, never diminishes.

It will still send a team to Haiti or Sri Lanka when the news agenda dictates that it is the biggest story, if not the most populist. How many other titles on Fleet Street are still prepared to do the same?

And here’s the rub. If it is the content that wins out, those who choose to cut their journalists rather than invest in them, run the risk of being left with an unsellable product. There would be no other option but to give it away free.

NI should also be able to harvest all manner of information about reader habits from those who do subscribe.  Everything from what and when the user reads, to how long they spend, what ads they click, comments they leave and so on.

Not only is this knowledge power, it is demonstrable brand loyalty. If someone is willing to pay for a product like this, it is because they choose to. That in itself is a valuable asset to any publisher.

In a declining ad market, by choosing to subscribe, these readers instantly become more appealing to advertisers able to target their demographic and follow their trends. 

Yet users will only pay if the journalism is worth it.

The bottom line is this. Standing still is simply not an option when circulation and advertising in the print market is plunging through the floor. It is not financially viable.

The Times and Sunday Times made a pre-tax loss to June last year of £87.7million. 

It knows that cannot continue. It must find a way of stopping the rot, as must all in the industry. Secretly, I wonder if the likes of Trinity Mirror, Associated, and yes, even the Guardian, hope they succeed.

After all, they helped create the problem the industry now faces by failing to understand the potential of the web at the outset, and giving away the family silver from the start when, in fact, they should always have been charging. 

They collectively shot themselves in the foot and are too embarrassed or beholden to shareholders to admit it.

Of course News International will absolutely have a huge job building up those willing to pay to consume their news online, at least while waiting for the generation who expect to do so to come along.

But thankfully it will be journalism, as well as innovation, that counts as was witnessed with The Telegraph being named newspaper of the year.

You see, brand loyalty is all well and good, but if a news organisation really has been scooped, it must live with the fact readers will flock to their rivals because content is still king. 

But then again, how will readers get to that exclusive content when it is held behind a paywall.

Unless, of course, they are willing to pay for it after all. 



Categories: Paywalls

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1 reply

  1. Hi Shaun
    I think you’re right on this. Simply put, quality journalism costs money and I think people will eventually realise that if they want to get information they can trust, they will have to shell out something for it. I blogged about this on August 14 asking ‘Can Rupert Murdoch save journalism?’ Answer – possibly.

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