The latest pay wall for a major newspaper isn't working

Because we do plenty of news aggregation and analysis here, we’ve watched with great interest the early-stage trend toward the imposition of subscription fees for access to newspaper web sites.

Recently, we engaged in a very brief, and mostly cordial, Twitter debate with Bob Glauber of Newsday regarding the potential dangers of placing content behind a pay wall, given the oceans of free content on the Internet.  Even if the experiment generates sufficient revenue to offset the lost advertising revenue, traffic — and thus influence — will plummet.

But with newspapers like the New York Times also following suit soon and with certain publications, such as the Wall Street Journal, implementing the program successfully, perhaps the cat isn’t so far out of the bag that it can’t be jammed back in.

Then came today’s report from the New York Observer that, in three months, Newsday has sold a whopping 35 online subscriptions.

That’s 35.  For a major newspaper in New York City.

So why has the Wall Street Journal been successful?  Probably because most of the subscriptions are coming from places of business, with the expense not coming out of anyone’s pocket.

Bottom line?  We’ll be able to easily give away free one-year subscriptions to PFT for many, many years into the future.

UPDATE:  Apparently, Newsday isn’t really a New York City paper, but a Long Island operation.  Which makes the decision to put its content behind a pay wall more surprising, and the outcome of the experiment less.

29 responses to “The latest pay wall for a major newspaper isn't working

  1. Newsday has always been the black sheep of the NYC tabloid scene. For them to even try this was just retarded. You can pull this off if you have name brand writers or a niche market that caters to rich customers. This is why WSJ can pull this off and why the NY Times might be slightly successful at it. Newsday? Seriously? LOL….

  2. You can get access to the content if you have Optimum Online or a Newsday subscription. I guess it figures that if those people weren’t getting a subscription, they wouldn’t bother paying for online access.

  3. Bottom line? We’ll be able to easily give away free one-year subscriptions to PFT for many, many years into the future.
    Until Jay Leno decides he wants PFT that is.

  4. “We’ll be able to easily give away free one-year subscriptions to PFT for many, many years into the future.”
    And Pat White’s heart just got the warm fuzzies.

  5. I’m still waiting for a refund from last years subscription!
    Do we also get the chance to win you’re book this year?
    I’ll even pay for shipping if I’m so fortunate to win.
    Donate that fine read to charity in my name.

  6. Kevin Kelleher, The Big Money:
    For the sake of argument, let’s say that news sites are routinely charging readers in five years. By then, the economy may be substantially healthier than now, and advertisers will be looking for sites with large, loyal readerships to sell their ads on. But that won’t include newspapers. They’ll be catering to that 10 percent of their online audience willing to subscribe. The rest of the Web will have long stopped linking to–and talking about–their stories. The dollars will flow right past the newspapers’ pay walls. And then they’ll really be sorry.
    (That 10% figure seems optimistic to me)

  7. And another thing. Let’s say that all of the big newspapers got together, and decided they were all going to charge for content.
    Under such an unlikely (and, most likely, illegal) arrangement, it is a sure thing that some site would be able to grab those newspapers’ traffic and ad revenue by providing basically the same stuff for free.

  8. I imagine if the majority of websites used a pay model from day 1 back in the mid 90s, nobody would have batted an eyelid and would have happily paid for the content. But instead they opted for a giant ponzi scheme whereby every website hoped to make money by advertising other wibsites, which in turn made money by advertising other websites and so on.
    Now people are so used to getting stuff for free on the internet it will take a very long time to change the culture, if it’s possible at all.

  9. I hav to say that anytime I see a link to even a register news site, I ignore it. I find free news elsewhere on the internet.
    Not to sound cruel, but this type of stuff is what bankrupts newspaper companies. YouTube, Yahoo, Craigslist, and Google do not charge us, and look how popular those sites are.
    Kind of hard to pull for the papers when they pull shit like this.

  10. “For a major newspaper in New York City.”
    Are you kidding me? I understand you’re a West Virginia guy. I don’t expect you to be familiar with the ins and outs of NYC. But would it hurt you to do SOME research? Even in it’s heyday, waaaaaaay back in the 60s & 70s, Newsday was a Long Island newspaper. Newsday’s biggest mistake was it tried to make inroads into NYC and veered away from it’s Long Island roots. When it opened a NYC office and sold a NYC specific edition in the 90s, it failed miserably. Newsday always was and always will be the “country mouse”.

  11. Florio, balls on right. And given my man crush on Mike Vick, I’m rarely one to heap a compliment your way.
    But one thing that always amazes me about aggregators is this. Why aren’t they cheering for the newspapers to do well. If they do well they earn money, put more people on beats and so forth. If not, then they rely on wire reports and anyone in the know understands the bullshit behind that.
    In my humble opinion, we’re not far having the NFL and all of the other leagues from breaking all of their own news. It’s pretty close to the case now, but whats left of the beat writers still serve as watchdogs in an indirect way. The NFL has to release its bad news with its good news because the game would be up shortly if it didn’t.
    But there’s no doubt that this league is going to outlast the newspapers. And when it does it’ll be the league calling all the shots to its writers on what can and can’t be written. If you think ESPN is bad, just you wait. And if that’s not so called state controlled media, I don’t know what is.
    And I’m not going to say PFT and other aggregators are costing papers money, because the papers have and will continue to dig their own holes that have nothing to do with sites like this. But at the same time, when the bow falls the cradle will rock and sites like this will rely on really shitty journalism that will wind up being so pro NFL it’ll make our eyes bleed.

  12. WSJ is failing quickly, don’t buy into the hype. I’m an investor and I know a ton others and not one of us gets our news from the WSJ. It’s perhaps the least important of all the investment papers. I’ll give it 4 yrs and then that experiment tanks.

  13. PS – if you want investment news, go to the Motley Fool. It’s 20x better than any stankin’ WSJ.

  14. “We’ll be able to easily give away free one-year subscriptions to PFT for many, many years into the future.”
    Yeah, because you are an aggregator. I realize you freely admit this and I love PFT because the opinion/analysis stuff is great. But if something isn’t done to fix this problem, traditional sources will go out of business and the myriad aggregators out there will be SOL. Or, more likely, standards will fall even farther and “original reporting” will basically turn into a comment board with the opinions of idiots like me as our only sources of “information”.

  15. I am a Wall St. Journal subscriber. I think there are two reasons they can charge for online content. One is that it can be paid for by your work or business. But the biggest reason by far is they never, ever gave it away. The charged for content from day one, so everyone expected to pay. If you get something for free, and later have to pay for it, you probably won’t do it. This is not really about who their customers are, but having the foresight not to give away the only thing they could sell.

  16. if the news is paid for by advertising, the news source makes money depending on how effective the advertising is. the more the advertising works, the more the customers will want to advertise. and the more they want to advertise, the more money the news source will make.
    if the news that the news source publishes actually motivates their readers into becoming better consumers of the products and services advertised, the news source will profit.
    in other words, if the news is ‘slanted’ in a way that makes you become a better consumer, the newspaper gets rich.
    if you have to pay for your news, i.e. via an online subscription, there is less motivation for the news source to try to turn you into a consumer. which is nice, since the news plays a huge role in shaping our society, and i don’t think our society is benefited by increasing our consumerism.
    so paid for news is not necessarily a bad thing.
    but maybe this is too many off-topic dots to connect for a football news website.
    in any case, go saints.

  17. No one wants to read their liberal spew. Why subscribe to the agenda they are pushing. The WSJ is good, but the NYT is a sinking ship, along with the MSNBC type news that is selling liberal bias views. No one wants to read that crap. I guess we will be bailing them out too. You live and die by the consumers decisions, if your product is crap, you change or die off.

  18. If you provide content that is not available elsewhere for free…people might pay for it.
    If you try charging for plain old news stories that a bazillion other sites provide for free…people aren’t going to pay for it.
    That is why newsday, NYT, and anyone else who thinks they can make more $$ from a pay for news service vs ads are destined to fail. There simply are too many other sites that happily provide the exact same content for free.

  19. Newspapers aren’t going under because they are being run by good business people, ya know what I mean?
    WJS as you mentioned, is a business tool and hence, a business expense. Their niche (focusing on business issues mainly) allows them to sell subscriptions. General interest publications don’t share that competitive advantage.
    There are several well known generic ways to compete in any industry as outlined by Prof Michael Porter:
    1. Cost leadership – you produce a competitive product at a really low cost
    2. Differentiation – you produce a product significantly different from your competitors that customers value and are willing to pay to get.
    3. Niche (AKA Focus) – you identify a small segment of the market and cater to their needs.
    Companies that get “stuck in the middle” typically have a hard time making money and surviving long term.

  20. The problem is that people want stuff for free. Maybe it is because in the early days of the internet that was what was promised.
    As for this poster, who wrote “YouTube, Yahoo, Craigslist, and Google do not charge us, and look how popular those sites are.”
    How much site generated content do they provide? Youtube is people uploading videos, Yahoo does generate their own media but they are struggling and more popular for providing a one stop shopping of content and search engine Craigslist, same deal, user generated. And lastly Google doesn’t generate much of their own content, just provide ways to use and view it. If you want news on something do any of those sites provide it without referring you to another site?
    I am not sure what news papers are going to do. Can they survive as a online only if people 1) don’t want to pay and 2) don’t want ads. The time, the work, the bandwidth, etc…isn’t free. Someone has to pay the bills at some point.

  21. The thing that will hurt internet sites is the tax the f’n UN is looking to put on internet usage. if I get charged everytime I use the internet, I might come here once a week rather than a couple times a day.
    Rather than destroying the UN compound in Haiti, the earthquke should have been under the UN building in NY.

  22. “So why has the Wall Street Journal been successful?”
    Two reasons:
    1) The scarcity of the information /opinion it contains (Local/International news is in abundance, respected business/financial knowledge is not)
    2) The relative affordability of those that purchase the subscription.

  23. Charging money in exchange for information has held back progress since the concept of intellectual property was invented. Apparently it’s only going to get worse. Nice.

  24. recently newsday was aquired by cablevision which is owned by the dolan family,you know,the people who own the the knicks and rangers.get where i’m going with this?
    when the dolan family got a hold of newsday recently,the price of a newspaper was fifty cents now with the dolan management team in place the price has doubled to one dollar,nice,right…
    the new price for the newspaper would be okay if not for the fact that the newspaper doesn’t even qualify for birdcage liner.i’ve never seen a newspaper with so many errors on a daily basis.
    when reporting a story,basic fact checking is a prerequite at most newspapers,not at newsday.
    grammar and mis-spelling are too common,it seems no one proof reads at the paper.
    i can’t see why any one would want to buy this paper.

  25. If I can get it for free on some other site why would I pay? This reminds me of ESPNs Insider, they want to sell the information that PFT usually has 12-24 hours ahead of them (before Adam Sheftler started getting the lead on everything for the evil empire) Its all sources or nothing if you want a pay wall to work. Except for CNN and FOX News of course. Since they both suck so badly at real news anyway why bother.

  26. Hey Tom Coughlin:
    Let’s not forget the size of the paper. They shrunk it to save ink! I think the Enquirer is bigger.

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