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The Paywall Cometh and It's Not a Big Deal

  |  March 25, 2011   |  Comments

A look at the ripple effects of The New York Times paywall.

3…2…1…and…welcome to the apocalypse.

The New York Times, that stalwart of newspaper publishing, has decided to put a paywall up around its content. No longer will readers be able to freely and fully access all the articles they want, anytime they want, starting this month. It's been a long time coming, but a paywall was really inevitable.

There have been various concepts put forth over the years for how publishers like The New York Times would make money from their content. Certainly advertising has been a significant source of revenue, but really there was no way that content as expensive to create as the type of high-quality reporting from The New York Times would remain free forever.

The good news, however, is that this paywall is pretty forgiving. It's the sort of paywall that a publisher who is deeply aware of the way that online networks have changed the ways in which people keep up with what's going on and find interesting news to read.

The Details of the Wall

The NYT paywall isn't a complete block against anyone who isn't coughing up cash. In fact, the content on the site is still extremely accessible. Here are a few details from ClickZ's write up of the announcement of the paywall:

  • People will be able to view 20 articles a month, totally free
  • There are three subscription levels; pay more and be able to access the content from more devices
  • Print subscribers get total free access
  • Home page is free as well as the blogs

What's more, the NYT has specifically allowed expanded access to news content that comes into a person's daily lives through either search or social media. That is, if you find a NYT article as a part of a search, you won't have to pay for access, even if you've already hit your monthly limit for articles (although there is a limit for Google). I suppose this could be a loophole someone may exploit. If I have a friend paying for access, I could potentially have him tweet a bunch of articles to me every day. Or, we could see people making Facebook requests to have an article shared with them. But this would seem unlikely to be sustained, and NYT probably could cut this new-aged paperboy off.

Paywalls Create Good Neighbors

If you've followed online content over the last several years, you know that this was not an easy decision for the NYT to make, and that this move is most likely going to prompt a lot of other publications to start charging for their content, at least in some way and under some scheme. This is finally a move that points to the maturity of digital content, and that’s a good thing for advertisers as well for two reasons:

  • Quality content is a buffer to cheap content: We've seen a real growth in low-quality content. Just as the retail space has seen an explosion in big box stores selling cheap clothes, the online space has seen a meteoric rise in the creation of cheap content, expressly created to drive up search engine rankings. The search engines are responding by defending their indices against this proliferation. But by creating a paywall and therefore a revenue model for good content, we can be sure that the top end of content - well-written, deeply-researched, and highly-relevant content - remains alive and well.
  • Paying customers are good customers: Someone who has paid for access to a site is far more likely to be engaged in that site and less likely to stray to other sources of information. If you are paying for news from the NYT, you probably won't one day go over to The Washington Post just to read the headlines. A returning customer creates opportunities for deeper and more meaningful engagement from brands because not only are they frequent visitors, but they also create digital trails that can be used for targeting.

I'm sure there will be some dissenters about the coming of paywalls. There are plenty of people out there who believe that content should be free and that if someone charges for something, they will be able to find a free alternative without too much issue. That opinion is destined to be a relic of a previous era of online content. Today, we are seeing more focus on creating great content from real producers, especially for the iPad and other tablets, which means that paywalls are going to stay.

In fact, we need to get around the concept that this is a "wall," which means that it is a block to access. Instead, we should begin to talk about portals or pathways, because it is clear that a grown-up approach to content and to the creation of content is only going to make the online experience better.


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Gary Stein

Gary Stein is SVP, strategy and planning in iCrossing's San Francisco office. He has been working in marketing for more than a decade. Gary lives in San Francisco with his family. Follow him on Twitter: @garyst3in. The opinions expressed in Gary's columns are his alone.

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