Media Paywalls: Paid-for news, rather than paid news, is transforming the way we consume the media

Ft paywall

“The future of journalism will increasingly depend on consumers paying for the news directly, as content distributors such as Facebook and Google take up the lion’s share of digital advertising dollars. The media will fight back by putting up their version of paywalls.”

This incredible prediction was made in The Media Insight Project, a collaboration between the American Press Institute and The Associated Press-NORC Center for Public Affairs Research, way back in 2017. It was an era when print and television mediums still had a strong run and the internet was emerging as a strong contender in the news and views stake.

Media insight project

The first report in the series is based on in-depth formative interviews with news consumers in three cities and a nationally representative survey, informed by interviews with American adults conducted between February 16 and March 20, 2017. Contrary to the idea that young people will not pay for news because information on the internet is free, nearly 4 in 10 adults under age 35 say they are happy paying for the right and credible news.

Ft website

This confirmation, though, came late in the day, in fact, almost ten years late. In 2007, Financial Times—regarded as one of the most credible news and media platforms in the world—put up a metered paywall that allowed registered readers a choice of three free articles a month, beyond which they had to pay.

Since then, a lot of water has proverbially flown under the bridge. Most large news media organisations are now focussing on the online platforms and most have put their news and features behind a paywall.

Lionel barber
Lionel Barner, Former Editor, Financial Times

By April 2019, Financial Times had signed up 1 million paying readers, which, as its editor Lionel Barber told The Guardian, “was one year ahead of schedule,” proving that quality journalism is a winning proposition, even if it is behind a paid wall. By May 2020, paid for digital subscriptions accounted for more than 75% of the way FT readers were consuming its content, according to leading American media blog,

The writing is on the wall. New York Times embarked on its subscription business in 2011 and today has over 2.2 million paying readers, besides the 400,000 who pay for the Times’ standalone Crossword and Cooking apps. In 2017, the media conglomerate earned $340 million from online subscriptions, 46 per cent high over the previous year. These figures were officially declared by NYT.

Nyt website

For those who aren’t aware, here is another fact: This growth equals the business growth of Facebook in the same year and was much faster than Google, which grew at a 23 per cent, according to an article on NYT seems set to surpass their subscription target of 10million subscribers by 2025; today they stand at 6.5M.

An article on NYT on reports that over an eight-year tenure that began in 2012, Mark Thompson, its president and CEO, has overseen a dramatic transformation of the institution into a digital-centric news brand. Under his watch, the Times’s digital readership has jumped to nearly 5.7 million subscribers, from half a million.

In 2019, came the news that the B2C media (Business to Consumer) such as the behemoth Conde Nast Group would also move behind a paywall. In 2020, Conde Nast went ahead and added a paywall to several of its titles. “The paywalls at each title are not one-size-fits-all models. Just as we did for each of the brands currently behind paywalls, we let consumer demand and engagement dictate how each brand develops its paid content strategy,” Chief Executive Bob Sauerberg told the Fashionista magazine. “Some brands have specific content that is gated, and some have a wider metered paywall. Every brand is distinct, and every brand’s paywall will be its distinct product.”

National Geographic has a paywall for one tier of content. But they do it a bit differently. It is working on a system called Counting Up. If implemented, it would work in very different ways. Instead of hitting a paywall, the user will be prompted to enter their email address or log in via Facebook.

A Django-powered widget linked to the account will follow them around, tracking the stories they finished reading, videos they watched and social engagement if any. This data will be updated into the publisher’s CMS in real-time. The publisher will pre-set milestones for the reader, which unlock a segment of premium access for a limited amount of time. Throughout this journey, the reader will be reminded that if they take a paid subscription, they can have immediate, unlimited access.

The publisher will pre-set milestones for the reader, which unlock a segment of premium access for a limited amount of time. Throughout this journey, the reader will be reminded that if they take a paid subscription, they can have immediate, unlimited access.

Media Observer Felix Simon

American media observer Felix Salmon, writing in, predicted that eliminating the print product would have the beneficial effect of boosting online subscribers. “My view is that most of the print subs are digital subs with a print upsell. If print went away tomorrow, at least half of those revenues would remain.”

Marketers and publishers have recognised the power of the paid digital subscribers as serious consumers of media. In this regard, The Washington Post’s Megan McArdle’s view is of great importance. In her column in the newspaper, she posits that publishers have raised paywalls as a way to wrestle back control of both content and distribution. For more than a century, newspapers worked in a two-sided market where they sold subscriptions to viewers and then sold those viewers to advertisers. And it was the advertisers who covered virtually all of the costs of production.

Megan mcardle
Megan McArdle, Columnist, Washington Post

“Then the Internet came along, and suddenly, we didn’t own the only pipeline anymore,” McArdle writes. “Anyone can throw up a web page. And over the past 20 years, anyone did — far more than could support actual advertiser demand.”

Simon houpt
Simon Houpt, Senior Media Writer, The Globe and Mail

There is this other little thing about bringing back credibility to the news media. The Globe and Mail’s senior media writer Simon Houpt, in his article on the rise and rise of paywalls, has written, “The price of static online ads used by most news sites has been falling for years, making it difficult for them to earn enough to pay for even the creation of popular articles. And many journalists worry that popular articles that pull in traffic are not necessarily the most important ones.”

Paywalls, to their credit, negate the need for clickbait articles to subsidize good reporting. In a digital publishing model revolving around ads, low-quality and attention-grabbing articles rule. But in a world led by consumers paying for the news and views that matter, the balance is gradually tilting.

The hindu website

In India, too, media houses that have resorted to the news behind a paywall have hit a pot of gold. The Hindu Group (THG), a 141-year-old brand, was the first English-language Indian newspaper to go digital in 1995. Then, in February 2019, the leveraged their critical mass of online readers and user-friendly online payment infrastructure, to first put up a soft paywall in February 2019, and a metered one in October.

Among their products, BusinessLine has made certain sections paid, such as Crossword, e-Paper and Young World Club. Frontline, the brand’s long-form magazine, and Sportstar, a fortnightly sports magazine, also have a few paywall stories, though their revenues from the paywall are not publicly available.

Pradeep gairola, the hindu
Pradeep Gairola, VP and Business Head, The Hindu Group

In 2019, the media house company won a gold award for having the best-paid content strategy at WAN-IFRA’s South Asian Digital Media Awards. Pradeep Gairola, VP and Business Head, The Hindu Group said in his presentation to WAN-IFRA, “In international markets, where most publishers are behind the paywall, search engines have changed their strategy and now do not penalise that content. In India, once reputed publishers start building paywalls, the SEO impact will be nullified for everyone.” Pretty much every Indian media house, from the Business Standard to The Times of India, has some or majority of the content behind a paywall.

Once, media houses feared that the growth of the digital medium would spell a death knell for traditional media houses. But experience shows when media conglomerates put their fate in the hands of their readers, or consumers, rather than just advertisers, they are rarely let down. Paid-for news rather than paid news is transforming the way we consume the media. That just means good news for publishers and, by extension, for marketers who will be able to define the audience they are catering to far more effectively.

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