News ‘set to review paywall strategy’
News Limited appears to be set to review its paywall plans for its metro tabloid mastheads after a slow takeup of Herald Sun subscriptions, The Australian’s Mark Day has suggested.
Writing in his column, Day – who is usually well informed on the inner workings of his parent company – said: “There is acknowledgment at News that strategies for paywall introductions at other titles may need review.”
In April, The Herald Sun was News Limited’s first tabloid to erect a paywall. But readers who took the three month free trial have not necessarily converted to paying subscribers. The company has so far declined to release any takeup numbers for the $4.95 a week subscription although Day says that 240,000 took the initial trial.
Day, who describes the Herald Sun as “News’s canary in the coalmine”, quotes “a senior editor” within the company he asked about the drive to paywalls and whether it would work. “It won’t,” was the answer.
Day also quotes an executive as saying: “Telling people they now have to pay for something they had free for 15 years requires a big sell.”
The Herald Sun’s paywall drive centres around the loyalty of AFL fans to the title’s SuperFooty interactive game, which regularly had 400,000 players and was thought to be the key driver to encourage fans to subscribe. However, the Superfooty site can be accessed for free via other News Limited websites which removes the necessity to subscribe if readers realise.
Media agency network Group M’s chief digital officer Danny Bass told Mumbrella that he preferred the apporach of Fairfax Media which has so far stuck with a free strategy although it has telegraphed a move to metered access in the coming months.
Bass said: “The Fairfax model of going free for everything has won the day so far. Go big, make it free. The challenge for Fairfax is how to convert them. The micropayment model seems to work better in this market – people are more comfortable with it. The model working around the world is the gaming model – free or low cost to start with and them small purchases in game or in-app. A 50c charge as you go is a lot easier for consumers to accept than a $5 charge at the start of each month, even if it adds up to more overall. It’s the iTunes model.”
Other News titles due to follow suit are Sydney’s The Daily Telegraph, Brisbane’s The Courier Mail and The Adelaide Advertiser.
The Herald Sun declined to comment.
What an overwhelmingly unsurprising announcement.
$4.95/week is $257.40/year.
The Economist, an international publication whose readership demographic would be several sociodemographic leagues above any local newspaper, quite apart from being a work-paid perk or at least tax deductible for the majority of readers, only costs $189.99/year.
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It’s hardly surprising, and very simple at the same time: What’s the tangible value for those that pay? Are they getting more than the $250 they plug into it over a year?
Unless the consumer gets materially more than they’ve paid – be it content exclusivity, really mentally stimulating information, financially beneficial ‘advice’ (think online investing publications), then they won’t pay in the scale required. Maybe the HS will be viable once they stop publishing the actual newspaper, those printing presses must cost a lot to run – although then they’ll be competing purely online, which would be…. interesting.
IF they do drop the pay walls it’d be very interesting to see if the readership will come flooding back especially after the HS has trained readers/users to find the same information – or maybe even better – elsewhere.
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let’s all admit none of us have any idea around paywalls.
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Day appears to be announcing that you can’t charge for the Hun when the good bits are free on the telegraph site. Who’d have thought??
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An online only subscription isn’t $4.95/week, it’s $2.95/week ($153.40/year).
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SuperCoach is the game, free to all users with a paid component for unnecessary extras. SuperFooty is the AFL news section, available for free by going through other sites like the Daily Telegraph, Courier Mail, etc. or simply googling the end of the URL and getting the article from one of those affiliate sites.
They speak about the iTunes model and having smaller (50c) charges as you go rather than a monthly fee; why not charge per article and have an account and small purchase buttons like iTunes? I don’t know how many articles the average reader would access in a week, but for argument’s sake let’s say it’s 10 articles at $2.95 a week (for a week of the average person who’d click onto a news website; I assume a subscriber would read more but really this is just a BS number). Could they charge $0.29 per article and attract more casual users, while still getting their $3 or more from people who would be subscribers? Or maintain the $2.95 for ‘power users’ and charge $0.19-$0.29 per article?
As far as football is concerned I can get as much in 140 characters on Twitter as I can from Herald Sun/Daily Tele journalism, so I’m not going to pay for that regardless of their model.
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Supercoach was never paywalled via HS – so the story is wrong here. Superfooty content was on the whole paywalled … but 99.9% of Supercoach players probably couldn’t care less as they can get the same footy analysis elsewhere for free. I highly doubt the strategy was to get Supercoach players to pay as they never had to (and they’d all go to the other countless fantasy games like Dreamteam etc)
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Shamma, your point re: paywalls is not entirely true.
There are many people (even within NewsCorp) that understand that successful paywalls have at least one of the following three components:
1: Genuine exclusivity (substantially better coverage or exclusive broadcasting rights) ,
2. Time critical content (think stock market or sporting event)
3. Corporate (rather than individual) customers. They’re simply better payers and more likely to put their hands in the pocket for company critical content.
Finance based media sites have a strong mix of all three. The perfect paywall storm would be the Wall Street Journal having the exclusive broadcasting rights to the Superbowl on the same day as a major IPO.
General news sites are shit out of luck. For the vast majority of readers general news is far too easily replaceable. Readers are used to checking a number of sites in a short time frame. Anything with a paywall simply gets taken off the roster.
Many within NewsCorp new this before Herald Sun disaster and begged for a New York Times style “Pay Meter” where the site keeps all of the visitors (UB’s) but sacrifices some page impressions as a small percentage of readers use up their 20/10 direct page views per month. They were over ruled despite having inside knowledge on how poorly the Time of London has performed and how heavy the axe has fallen on staff there (more than 120 journos got the chop this year).
The New York Times has made the Times of London (the model the Hun adopted) look pedestrian and foolish.
To understand why the Hun went ahead with this white elephant despite overwhelming evidence that this approach would fail you have to understand the three distinct tribes within News Limited.
The inky fingered luddites, the digital dreamers, and the wandering wombats.
The inky fingered luddites are led by the personable and well spoken Campbell Reid. Campbell is politically astute but by his own admission he struggles with the new world. The luddites are born and bred newspaper people. They massively overvalue our content and don’t understand that media organisations are competing against Angry birds as much as they are competing against other papers. We are all vying for attention and you can put an ad next to Farmville or Youtube just as easily as you can put it next to a Walkley award winning story.
After a patchy few years from the digital dreamers and a high profile disaster with the CMS (fatwire) the power has shifted away from the new defunct News Digital Media and is once again held by the Luddites. They genuinely believed the Paywall would work because they simply can’t understand how anyone could live without the Hun. They’ve romanticised journalism as a way to cope with the incredibly poor pay and complete lack of job security. They conveniently forget that more than 60% of our stories are straight cut and pastes from dodgy press releases and they genuinely think they’re doing God’s work while writing hatchet jobs, deliberately stirring the middle class pot and running pic after pic of Lara Bingle’s boobs and bungles.
The digital dreamers were absolutely aware that the paywall would flop but they’ve lost their way and have for the most part have been divided and conquered. They did very well in terms of audience but (like every other media org) struggled to bring in big revenue. The Luddites always eyed them with suspicion and a spate of tech disasters rocked their power base. Hartigan was surprisingly open to new ideas but like most of the organisation wasn’t entirely sure the digital dreamers could deliver on their wide eyed promises. Whole divisions of NDM have been surgically removed and the leftovers have been swallowed up by the new state based structure. To be perfectly honest the quality digital staff had already left the building as they are some of the very few people here who can get a job outside News and Fairfax. Agencies have given them healthy pay rises and they smile and text us phone pics of themselves doing shots out of the cleavages of busty receptionists from the top deck of their third harbour cruise that week.
The wandering wombats don’t have any answers or ideas and they mostly don’t care. They know we’re only at the beginning of the axing’s and they amble about with their heads down praying that they’ll be judged on how they delivered their last project, not caring (or knowing) if that project made a lick of difference. Surprisingly the wombats make the largest tribe. They’ll nod and agree with whoever they just spoke to whether it be a luddite or dreamer hoping to not cause a fuss and make themselves invisible when Chase Carey picks up the phone and tells Kim Williams to sack another 1,0000 people next month.
I nearly choked on my cornflakes when Chris Warren of the MEAA said yesterday that he believes this will be the last round of redundancies in News Limited restructure. Exactly the opposite is true. News Limited has bet the farm on Paywalls being our salvation. It’s a mistake but they didn’t have many other ideas and it’s now too late. Chase Carey hates us, well more accurately he hates how much money we (newspapers) lose. Our stay of execution was to see if Paywalls could save us.
They haven’t come close.
Batten down the hatches because over the next 90 days the hallways will run with blood. I’m only hanging around to see the look on Stephen Brook’s face when I tell him to use twitter to advertise for a new job.
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I heard that Fairfax were preparing to charge?
This must be a worry.
@ Unevenly distributed – lovely insight, thanks!
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