Australia’s positive paywall experience

Newspaper paywalls are not the magic bullet publishers like Rupert Murdoch hoped for.

Yet, they haven’t failed.

Evidence from paywall projects in Australia suggest they have a role as news publishers stumble from print into the digital age. Australia’s two national daily newspapers both now have paywalls.

Writing at ComputerWorld Australia, Andrew Birmingham reads the entrails from The Australian Financial Review and The Australian.

Birmingham’s conclusion isn’t optimistic or pessimistic. He  says results to date provide enough positive news for the publishers to convince themselves they have a fighting chance.

He is too gloomy. While Fairfax and News Corporation may struggle, the evidence points to something better than a mere fighting chance for publishers, at least online if not for their print operations.

Australia’s great paywalls

Six months ago The Financial Review changed from hiding almost all content behind a paywall to a more open model. It made online content available to print subscribers and halved the price of digital-only subscriptions.

Around the same time New Corporation introduced a paywall at its flagship paper The Australian and began selling sensibly priced bundles of print and digital subscriptions.

Last week, Fairfax said it will introduce paywalls for the online editions of The Sydney Morning Herald and The Age.

Numbers not bad

Six months after changes at the Fin and The Australian, Birmingham found an overall disappointing picture: paywalls did little to stem falling print reader numbers and failed to increase the overall pool of paid readers.

Page impressions at The Australian fell 35% after introducing the paywall. Unique browsers fell 25%.  The Fin’s relaxed paywall saw page impressions climb 82%. Unique browsers climbed 80%.

I’d say these numbers are positive and set the scene for the next stage.

Metros go behind the paywall

Next year when The Sydney Morning Herald and The Age are behind paywalls, there will be fewer plausible free alternatives to The Fin and The Australian.

While there will be plenty of niche options, the only sizeable, credible free online source of Australian general news will be the ABC. Some might argue sites like NineMSN and Yahoo will plug the gap, but they offer a different news experience.

This will strengthen the paywall strategies at News Corporation and The Financial Review.

Now put advertising in the mix

Paywalls help news publishers distinguish their sites from the rest of the web with advertisers. Today’s free newspaper websites generally feature a cluttered mess filled with nasty cheap advertisements. The Financial Review on the other hand has a clear design with a limited number of appropriate and, presumably premium-paying advertisers.

Whatever the details, a paywall means a publisher can move beyond whatever-dollars-we-can-get advertising and start to think strategically about sales. Advertising is, ironically, where publishers have most to gain from selling digital subscriptions to readers.

Apart from anything else, a paying reader is clearly committed and solvent.

Conclusion

  • Paywalls have proved less of a turn off than many feared.
  • Paywalls mean more income.
  • Now competitors have paywalls, Australia’s existing paywall publishers are no longer out on a limb.
  • Paywall readers are better advertising targets. They will lead to higher cpms (revenue per served advertisement).

Publishers aren’t out of the woods by any standard, but there are grounds for limited optimism.