Should I Pay or Should I Go? Do Newspaper Paywalls Work?

The Google Wall of the Internet.

Should newspapers close their free websites and erect paywalls?  A paywall requires readers to pay for access to the newspapers’ news, features, opinions and other content.

Paywalls have been met with outright scorn by advocates of “free” information.  They have also had limited success.

The Wall Street Journal has been success with its paywall.  But the New York Times abandoned it’s experiment with paywalls after traffic to its site fell drastically (although the Times has promised to start again next year).

While I enjoy free information as much as the next person, I’ve argued before that free information is much like anything else you get for free – substandard and unreliable in the aggregate.  Quality comes with a price.  By the way, I don’t count newspapers’ free online operations in this “free” category because those sites are subsidized by their print products.

However, as print circulation plummets, newspapers are having a terrible time continuing to subsidize their online properties.  Which is why paywalls are once again being discussed.

Barry Diller, chairman and chief executive officer of IAC/InterActiveCorp, recently told Bloomberg TV:

“[Free content] will end because now so many people are used to paying for applications, whether they pay 99 cents or whether they pay for a tune, or they pay 99 cents to play Solitaire, or $4.95 to do this or $2.95 to do that, or one kind of one stop, very simple to do. That in these little form factors, first with the iPhone and now the iPad and dozens of other devices that will come, this is naturally going to evolve. It’s got this legacy of this mythology. But it will end.”

The biggest advocate for paywalls may be Publisher Rupert Murdoch, who has vowed to put all of his newspaper properties behind them.  His newspaper the Times of London is currently conducting just such an experiment.

The newspaper closed off its free online edition and put a pay barrier.  As the blog Newspaper Death Watch has noted, traffic to the Times of London has crashed by as much as 90 percent.  However, the blog is quick to point out that the Times of London expected that kind of fall-off.  So perhaps it isn’t a bad thing.  The blog also notes:

“Let’s give the Times credit for setting up a real paywall. Even Google can’t penetrate this sucker. Clicking through to any section or story from the home page is pointless without a credit card in hand. Murdoch is putting his money where his mouth is. He has pledged to take all his newspapers to a paid-access model, and the Times’ experiment is bold, regardless of the outcome.”

The real test for paywalls, however, will come early next year when the New York Times plans to build one.  No doubt they are watching the Times of London closely.

I’ve got my doubts about the viability of paywalls, but understand that newspapers must to charge for content in order to survive.  I agree with Diller and believe that consumers of news will eventually understand that the era of free will soon be over.

What do you think of paywalls?  Good or bad?  Will they work?  Or should newspapers focus on figuring out the elusive business model that keeps their content free?


How Reliable is Free Online Content?

Bloomberg TV interview with Barry Diller (via Poynter Online)

Photo by Ralphrepo (via Flickr)

Newspaper Death Watch post on the Times of London.

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