Am I going to get paid for this? Paywalls and Online Journalism

At the moment, the answer seems to be – probably not.

A recent online journalism lecture served as quite a wakeup call for many of my fellow students (and confirmed my own fears) about the current state of the journalism industry.

John Grey, former online editor at the Courier Mail, used a somewhat depressing Titanic analogy to describe the reaction media organisations have had to declining newspaper sales and the move to an “online future”.

“They’re not just rearranging the deckchairs, they’re throwing everything overboard.”

But before we all sink any further into the icy waters of despair, it’s worth noting consumers clearly still want our product.  The following graph, using information from a Ray Morgan poll (and referred to in the Week 2 lecture) shows traffic to online news sources has grown very steadily over the past couple of years.

Source: Online Journalism lecture, week 2; Ray Morgan Research

Further, it could also be said readers still want their news from the same familiar sources, that there remains a certain brand attraction (or loyalty) to specific news outlets.  A 2012 “State of the Media” report by the Pew Research Centre’s Project for Excellence in Journalism found searches on (in?) the news outlet itselfwere the “most popular path to the news” (followed by general searching of the web).

However, even though people still want the news, the news organisations themselves are struggling to figure out how to make this pay.  According to John Grey, the current online news model is free content, supplemented with advertising revenue.  While there are many different ways of raising revenue online (charging properly for online advertisements, website registration with demographically targeted ads, metered access to websites), the most common method appears to be the construction of a “paywall”

Why have paywalls?

According to the Oxford Dictionary of English, a paywall is “an arrangement whereby access is restricted to users who have paid to subscribe to a website.”  That little definition was added in 2010.  Many news organisations are now making readers pay for online content – most notably big American newspapers like The New York Times and in Australian, local heavyweights like The Australian and Herald Sun.

For the New York Times, the paywall seems to be working, appearing to be partially offsetting the fall in revenue from their print publications.  Steve Ladurantaye, a media reporter from The Globe and Mail, said the Times was expecting to earn $85 million from its nearly half a million online subscribers this year.

However, it should be noted that the Times paywall allows non-subscribers access to 10 free articles a month.  Ladurantaye also says this “metered” system is becoming the preferred method of online publication.  Carrot, then stick, I guess?  Maybe “bait” is more appropriate.

Online media advocated and associate professor at New York University says the Times metered method has been working because it can target both dedicated and casual readers.

“We will never get a majority or even a sizeable  minority of our readers to pay use directly, but we can design a system in which some of our most passionate, engaged readers pay us directly, and the rest of the readers, the casual readers, we can keep around for the advertising revenue,” he said in an interview earlier this year.

Closer to home, the Australian’s paywall also seems to be working, with around 40,000 subscribers by March 2012.

The other side of the argument

Not everyone is happy with paywalls.

A recent survey suggests only one in four new media professionals believe a paywall increases a company’s revenue.  Maybe more alarming for news organisations, the survey also found more than half of the participants said they immediately left the site when they encountered a paywall.  However, around 40% did say they at least considered a subscription purchase (and 22% said they tried to find some way of cheating the system).

I also find it interesting that even those who are training to be journalists are often turned away by a paywall.  While that article is anecdotal evidence, with a very small sample size, I personally can’t help but feel it’s a good indicator of what might be happening.  I know myself that I will often leave a news site once I’ve hit my free-article limit.  It’s for that reason that I usually visit those organisations that don’t have a paywall (most notably the ABC, for obvious reasons).  So if even journalism students are being turned away by paywalls, I can’t help but wonder how viable they are in the long-term.

And not every news site that erected a paywall has stuck with it.  A large regional daily newspaper in the UK scrapped its paywall earlier this year after only nine months.  However, it did replace it with an iPhone app, which suggest there may be plenty of other ways to get readers to buy content online.

Finally, but of the most concern to me, it’s also been suggested that paywalls will change the way journalists write.  According to journalist Tim Burrowes, the traditional format (pyramid structure, layering of information etc) doesn’t work for “paywall journalism”.  He says that as most paywalls allow the reader to see the headline and first couple of paragraphs, before asking for payment, the traditional model doesn’t prompt people to subscribe (as they’ll have gotten the most important information anyway).  Instead, introductions need to written to intrigue the reader, or be deliberately vague and only get to the point in the 3rd paragraph (which is safely ensconced behind the paywall).

However, Burrowes says this new method of writing is dangerous as it fails to put the reader first and could perhaps drive readers away.

“Each time creates a minor annoyance, until the reader starts to subconsciously associate that with the publication in question,” he said.

For me, this seems the most alarming thing about paywalls.  Asking for payment is one thing – needing to deliberately compromise your writing styles and key journalistic principles seems far worse.

I’m sure there’s a better way to make online journalism pay (but I don’t have any ideas).  I just hope they find it quick.


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