The Subscription Project – Or A Paywall By Any Other Name

Paywall.

Even the name is debated so contentious is this subject in the news industry.

The Pros and Cons of some form of online paid access for newspaper websites have been argued in such extremes that nuance and accuracy have been the first victims of the debate.

The Columbia Journalism Review links paywalls to higher quality journalism and argues the free web, supported by advertising, does the opposite – labeling the results “hamster wheel” journalism.

DFM’s Steve Buttry’s blog captures some of that argument – Pro and Con – here.

I have stated I think they can be a dangerous management distraction to the real job of adapting a legacy business to the realities of an Internet world.

To paraphrase Clay Shirky, you can’t fix a business model the Internet just broke. To which I would add you don’t transform from a broken model by tweaking it – you build something else.

I think paywalls, meters if you like, are exercises in tweaking not transforming.

Most paywalls in the US are simply initiatives in subscription price hikes – bundling digital with print with no clear plan for sustainable growth.

But I’m a Chief Executive, responsible to my employees and my shareholders. So, I can’t work on theory alone. I have to try paywalls.

So, welcome to the Subscription Project.

When I took over as CEO of MediaNews Group in September of 2011 – one of the companies we operate under Digital First Media – the company was launching paywalls, meters if you like, in 22 of its smaller dailies.

I watched them for a year. Their performance was abysmal bringing in gross revenues of about $300,000 in their first year. To put this in perspective, MediaNews Group has 57 dailies and has total annual revenues of about $1 billion.

We now internally call that failure Paywall 1.0.

We then circled back with the paywall provider PressPlus to find out from them what we could do better. And we spoke to others in the industry to get their feedback. A couple of months back we launched,at the same 22 sites, Paywall 2.0 incorporating all of the identified best practices.

At about the same time, we launched a project experimenting with the concept of “pay”.

We installed at all of DFM’s 75 daily newspapers an experiment in partnership with Google. On each Media Center section of our sites we placed a Google Consumer Survey that pops up after every 10 images.

Want to see the next image? As a visitor you have to “pay” by answering the survey question. We are now tweaking that further on some other sites with an interstitial ad instead of the survey.

It’s early days yet but so far the Google survey experiment is beating the paywall experiment in run rate revenue. Both the paywall and Google experiments cause traffic issues.

We are also planning a further test dubbed Paywall 3.0 which will combine digital subscriptions for print and mobile apps with the Google survey experiment.

It is too soon to say what will work and what won’t.

But I think we can say that emotional arguments over what something is worth in a market economy is a near worthless waste of time at the expense of finding real solutions to the problem.

We will report back from time to time on the Subscription Project as the numbers roll in.

One thought on “The Subscription Project – Or A Paywall By Any Other Name

  1. John, Znak it! provides an integrated monetization platform that allows publishers to charge for subs, one-time access (micropayments), ad-sponsored individual access (a bit like Google’s survey experiment but already with displayed ads or classified), and more, and we have excellent results.
    Check it out http://bit.ly/UzFcNT
    Why to reinvent the wheel?

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