Paywalls proliferate, despite their detractors

Comment by Tim Dawson

A string of positive recent headlines suggest that paywalls will be with us for some time to come, however regressive some consider them.  The New York Times a few days ago announced that it has 455,000 paying online news users – and reduced the amount of free content available on its sites.  News International released figures showing a 20% growth in digital subscribers over the past year and, Gannet announced that in the US it plans to restrict access to 80 of its titles.

The Daily Mirror says that it plans to launch a sub-£10 a month iPad edition.  And, The Australian sold 30,000 digital subscriptions in the first six weeks of erecting a paywall around its content.  In the US, 43% of daily papers now restrict all or some portion of their web content.

None of which has quietened those such as Clay Shirky, who argues that paywalls have a future that is about as promising as that enjoyed by audio cassettes as a means of listening to pre-recorded music.

In the long-run Shirky may just be right – although I am sceptical.  What he seemingly refuses to accept in the here and now is that those who are charging for their content (such as The Times and The Sunday Times – the latter of which I continue to be a regular contributor to, incidentally) are sanguine about the ‘lost millions’ of readers from their pre-paywall metrics.  The Times tally of digital subscribers has almost certainly now passed the daily circulation of The Independent, so can’t be dismissed too easily.  With almost no costs of distribution or printing, and most of its content garnered from the paper’s print editions, it surely represents a sustainable model?

There has also been a significant shift over the past five years to an acceptance that it is necessary to pay for digital content.  Apples iTunes currently has two hundred million credit cards registered – a massive customer base of customers who have accepted the need to pay.   Add to that the four million who are thought to have bought Kindles, and will consequently paid for their content, the case that sufficient consumes will never pay to sustain digital editorial products seems increasingly hard to argue.

Of course that does not mean that everything in the garden is rosy.  Research by the Pew Centre, which has been mentioned on this site before, shows just how hard it is to replicate ‘print-size’ revenue with that from digital.  Today’s trickle may never turn into gush, but that is not to say that it won’t sustain a good few media business in the coming years.