Temporary Paywall Removals Only Highlight The Fundamental Paradox Of Paywalls

from the backwards-economics dept

While there's room for debate on whether Rupert Murdoch's paywall strategy for the UK Times and Sunday Times has been disastrous or just mediocre, it certainly hasn't been a massive success or reinvented any online news business models. Now we're beginning to see some telling cracks in the facade: the Times paywall recently came down during the Queen's jubilee weekend, and now TNW reports that a similar free-access period is being considered for the 2012 Olympics.

Now, promotional giveaways are hardly a new or crazy idea, and they don't typically say anything bad about a business model—but I don't think that's really what's happening here. Certainly the Times hopes to convert some of those free readers into paid online subscribers, but there's also a clear pattern in the items they choose to make these exceptions for: huge social events that are attended and discussed by lots of people. In other words, precisely the sort of thing where blogs and social media offer the most competition to a newspaper. Why would anybody pay for Olympic reporting when the web is going to be absolutely flooded with constant updates on every little thing that happens, supplied for free by the fans and hangers-on? If the Times content is behind a paywall, it will be all but ignored.

And this really goes to show why, in the long run, paywalls are unsustainable. If the biggest, most popular topics are the hardest to control—and the ones that lose value the most when controlled successfully—while at the same, time social media and citizen reporting output is growing and expanding to new areas constantly, then the inevitable conclusion seems clear: paywalls are, at best, a temporary way of extracting a little bit of cash at the expense of long-term relevance. If your goal is to directly sell news as a product, but you discover that you have to eliminate your prices whenever product demand is highest, something is clearly wrong—you're trying to apply an old model where it doesn't actually fit, and getting kooky results. The solution is not to keep compromising the broken model, but to embrace the underlying realities (infinite content, no barrier to publishing, the huge value of share-ability) that broke it, and build new models around them.



Reader Comments (rss)

(Flattened / Threaded)

  1.  
    identicon
    Anonymous Coward, Jun 8th, 2012 @ 3:51pm

    PAYWALL! Quick, wake up the gim...umm, I mean Bob.

     

    reply to this | link to this | view in thread ]

  2.  
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    PaulT (profile), Jun 8th, 2012 @ 3:57pm

    Re:

    My thought exactly... paywall in the headline? Where's bob with his misunderstanding of what the word means and attacks on Kickstarter where no such paywall exists?

     

    reply to this | link to this | view in thread ]

  3.  
    identicon
    Anonymous Coward, Jun 8th, 2012 @ 4:10pm

    PayFail

    Turn InPrivate browsing on and you get around the paywall... at least on the LA Times... but if you want to comment you need to have a FakeBook account so I just read the propoganda to know what they are pumping.

     

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  4.  
    identicon
    Anonymous Coward, Jun 8th, 2012 @ 4:53pm

    Re: Re:

    The Queen's Jubilee. The Olympics. They need actual walls around them. It's the only way to protect them from freeloaders!

     

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  5.  
    identicon
    Anonymous Coward, Jun 8th, 2012 @ 6:19pm

    Hey, I'm good with them putting up paywalls. When I go to connect and it doesn't, right over from the site address space, is the search engine. It usually takes all of a minute to find the same or near same article somewhere else.

    That paywall was good for what???

     

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  6.  
    identicon
    Anonymous Coward, Jun 8th, 2012 @ 6:32pm

    Re:

    Helping you find alternative websites and spurring innovation

     

    reply to this | link to this | view in thread ]

  7.  
    icon
    Spaceman Spiff (profile), Jun 8th, 2012 @ 7:03pm

    Paywalls and Rupert Boondock

    I say, let them keep the walls up, and then wither on the vine! We don't need these over-rich, self-righteous, corrupted pinheads telling us what to read and think. They are as dead as the dodo - let them start to realize that, and there may be hope for us all!

     

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  8.  
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    mike d (profile), Jun 8th, 2012 @ 7:28pm

    Re: PayFail

    I deleted my RSS feed to LA Times and don't really miss it. I am in a better mood not knowing all the scary things (car thefts) that happen in my neighborhood!

     

    reply to this | link to this | view in thread ]

  9.  
    identicon
    PRMan, Jun 8th, 2012 @ 9:31pm

    Re: PayFail

    LA Times has a paywall? I've seriously never noticed.

     

    reply to this | link to this | view in thread ]

  10.  
    identicon
    Anonymous Coward, Jun 8th, 2012 @ 10:36pm

    Re: Re: PayFail

    After just a few articles you get this:

    "Become a member to keep on reading.


    We hope you've enjoyed your limit of free articles over the last 30 days. Want to see and know more? Become a member today and get unlimited access to the Los Angeles Times, Southern California's best online source for news, culture and happenings.

    As a member, you'll enjoy our award-winning news and information, including unique storytelling, investigative reports, opinion, in-depth local news, signature blogs, compelling photo galleries, original video content, and revealing data projects and analysis coverage. Plus, take advantage of special membership privileges."

     

    reply to this | link to this | view in thread ]

  11.  
    identicon
    Anonymous Coward, Jun 9th, 2012 @ 1:05am

    Re:

    The Gnu Imsge Manipulation BOB?

     

    reply to this | link to this | view in thread ]

  12.  
    identicon
    Anonymous Coward, Jun 9th, 2012 @ 1:35am

    no different to what so many other industries need to do in the digital age but no different to what so many other industries are NOT doing in the digital age.

    'trying to apply an old model where it doesn't actually fit' is a excellent example of what the movie/music industries are doing but they are then adding into the equation that labeling everyone as a criminal, suing them, bankrupting them and having them imprisoned is going to help their business to survive. some weird ideas around.

     

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  13.  
    identicon
    Anonymous Coward, Jun 9th, 2012 @ 6:15am

    Your hatred gets in the way of seeing what marketing is all about.

    For a limited time, you can enjoy the website for free. It's called a sampling special. The Olympics / Queen's jubilee are key moments, and they can aggregate more audience and show them just how high quality their product is.

    Then they can turn back on their membership system (why paywall? Why not "ticket booth" or "smart way to monetize your product"?), and perhaps pick up more subscribers as a result of people having seen just how superior the product is.

    I know you hate the idea that anyone has to pay for anything. Try not to let that hatred block your clear view of things. If you can't get something as simple as this right, I can't imagine all the stuff you miss out when you talk about copyright.

     

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  14.  
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    shawnhcorey (profile), Jun 9th, 2012 @ 7:38am

    No Paywalls

    Anyone who thinks a paywall is necessary just haven't looked at PBS. A nation-wide TV system that survives only on donations. If you have a high-quality product, you don't need to force people to pay you; you can thrive on donations alone.

     

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  15.  
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    techflaws (profile), Jun 9th, 2012 @ 8:18am

    Re:

    If you can't get something as simple as this right

    Says the guy who pulled 'hatred' out of his ass. Convincing.

     

    reply to this | link to this | view in thread ]

  16.  
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    Leigh Beadon (profile), Jun 9th, 2012 @ 11:46am

    Re:

    As I explained in the post, quite clearly, I don't think this is motivated by a simple marketing strategy. Apparently you disagree - but just saying I'm wrong and hateful five times without making any actual points isn't especially convincing.

     

    reply to this | link to this | view in thread ]

  17.  
    identicon
    Anonymous Coward, Jun 9th, 2012 @ 12:33pm

    Re:

    "(why paywall? Why not "ticket booth
    or "smart way to monetize your product"?),

    Simply because it is not a smart way to monetize product, it is however a great way to reduce your readership and therefore your impact and relevance, not to mention negatively affecting what you can make from the advertisers who have traditionally been the way that newspapers have made their money.

    But these aren't the darkest days, those are the days when the advertisers finally realise that internet advertising is not less effective than old media advertising but that in fact, old media advertising has never actually been worth the money they paid for it.

     

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  18.  
    identicon
    Aileron, Jun 9th, 2012 @ 1:35pm

    Paywall Newspapers miss the mark everytime

    Paywall newspapers are simply trying to apply last century pre internet models to the current world and simply shows how off beam these mega media giants can be when you move the goal posts. Really highlights little these people understand the modern environment.

    There are so many alternatives for them to make money if try and apply their brains to how people actually use the net and what they are are actually prepared to spend money on. Rather than trying to bludgeon their users with extraordinary cynicism.

    A couple of good articles on the alert.sqwark.me blogs to read on the subject.

    Online Advertising fails to deliver; but there is a stunning new approach

    New Newspapers of the future

     

    reply to this | link to this | view in thread ]

  19.  
    identicon
    Anonymous Coward, Jun 10th, 2012 @ 12:25am

    Re: No Paywalls

    Relying solely on donations can be risky though. If you ever hit a period of time where people won't donate for whatever reason, your business could go bankrupt.
    Donations also rarely suffice to allow you to save money for rough times, so that's not an available option here.

     

    reply to this | link to this | view in thread ]

  20.  
    identicon
    Anonymous Coward, Jun 10th, 2012 @ 12:31am

    I keep asking myself why I don't want to pay for news, while at the same time I don't want to see professional news sources go because I really don't trust my friend's social network posts for reliable information.

    And the answer is simple: I don't want to pay for news because the quality is not good enough. News give me the basic facts, and frankly even there quality is often poor. Journalists make up stuff completely, or read way too much into the information they have, or just surrender to lobbyists and the government... That's not worth paying for.

    On the other hand, journalism, if done right, can be very valuable to society and thus I'd hate to see it disappear.

    I don't know which business model newspapers should adopt, but I know this: if they want to stay in the game, they need to get their act straight and offer more quality.

    Give me a news source that focuses on news that really matters, that offers very reliable info, and which holds important parties accountable by asking the right questions and exposing the important facts.
    We need journalism we can trust and which serves society. And that's something I won't find on social networks or amateur blogs, and I'll be glad to pay for it if only to make sure it keeps existing.

     

    reply to this | link to this | view in thread ]

  21.  
    identicon
    Anonymous Coward, Jun 10th, 2012 @ 12:39am

    Re: Re: Re: PayFail

    Not as bad as the Onion's paywall in my opinion.

    Not only is the Onion's paywall xenophobic, it's also retarded because it restricts access from countries where the Onion isn't the most popular.
    It would make a lot more sense to put a paywall in the USA, where the Onion is most famous and where exposure is less nedded, than in foreign countries where the Onion is less famous, exposure is much more needed, and few people would pay a subscription to begin with.

    Oh well... most commercial humor websites go that route. I bet the next one to do this will be cheezburger network. CBN used to be a good website, but now it's filled with PC content and idiots who wrongly think they know and are a part of Internet culture, who spam the comments with absolute 10th grade idiocy and who think a troll is any regular prankster.

     

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  22.  
    identicon
    Anonymous Coward, Jun 10th, 2012 @ 12:43am

    Re: Re: No Paywalls

    Oh and I forgot - donations rarely help you raise enough money to expand your business, or at least they don't let you expand constantly: at some point in time, you don't get enough money in donations and must put expanding on hold.

     

    reply to this | link to this | view in thread ]

  23.  
    identicon
    Anonymous Coward, Jun 10th, 2012 @ 9:34am

    Re:

    So how come we can go to the park everyday for free UNLESS there is an event that people will want to see/attend?

    What does it cost to go to an arena when nothing is happening? When there is a basketball game, how much?

    These sporting venues and the like have it back asswards.

     

    reply to this | link to this | view in thread ]

  24.  
    identicon
    Anonymous Coward, Jun 10th, 2012 @ 10:57am

    I like this site

     

    reply to this | link to this | view in thread ]

  25.  
    identicon
    Anonymous Coward, Jun 10th, 2012 @ 8:05pm

    Re: Re:

    You didn't really bring anything that suggests otherwise, except perhaps your hatred of "paywalls". You perhaps need to re-read your own post to understand how you didn't really do anything except speculate, with little to back it up.

     

    reply to this | link to this | view in thread ]

  26.  
    icon
    Niall (profile), Jun 12th, 2012 @ 3:39am

    Re: Re:

    Because usually those are much more 'rivallous' settings - there are a limited number of parks in any area, and usually a very limited number of stadia. However, news online is pretty plentiful - it's very easy to go somewhere else for the same thing in most cases, unless it's a very specific topic or opinion.

     

    reply to this | link to this | view in thread ]

  27.  
    icon
    Niall (profile), Jun 12th, 2012 @ 4:19am

    Re:

    I must confess, as a UK taxpayer, I do enjoy reading the BBC news that I've paid for. And this of course, being 'free' to the rest of the world does rather skew things.

    Once again, it's about the rarities - reputation and interesting/thoughtful/challening opinions are where newspapers of the future can make their mark.

     

    reply to this | link to this | view in thread ]


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