Paywalls v. free: climbing onto the fence

When I worked at the Guardian from 2001-2006, I was a fully paid-up member of the Make it Free posse. I even co-wrote a document (with my very clever colleague Stephen Dunn) entitled Guardian Everywhere, which postulated a strategy designed to make Guardian content available everywhere and anywhere, supported by advertising. We came up with the buzz-acronym P.A.D (Permanent, Addressable, Discoverable) to describe how we saw the Guardian as this completely open platform, its articles and photos and graphics available to all and sundry – accompanied, it was hoped, by a revenue-generating advertisement.

Were we wrong? Well, David Hepworth thinks we were. To be fair, he’s always thought we were. His latest post on the subject says this:

Meanwhile, in another part of the forest, I’ve been saying for years that some of the people who make airy predictions about new digital business models should leave the security of their banker-funded old media empires and try to walk the walk they’ve been talking for so long. Andrew Sullivan, probably the biggest political blogger in the English-speaking world, has announced that this is what he’s doing. From February 1st his full output will only be available for the payment of a $20 annual subscription.

I’m sure Sullivan’s people know all the tricks to ensure that as many as possible of his millions of followers pay the sub. If an old magazine hand may offer an observation to someone entering the real world of trying to part private citizens from the actual cash money in their pocket (in which of course the proprietor of your local car wash knows more than the cleverest person in the Groucho club) it would be this.

Many of your followers will disappear with a wooshing sound the moment you even hint at charging. A noisy minority will fall over themselves to give you their money and will make sure everyone knows they are doing it. An argumentative minority will hang around to complain that what you’re doing is a) morally wrong and b) bad business practice.

Don’t worry about any of these groups. The people you have to worry about are the ones who fully intend to subscribe, in some cases think they already do subscribe, but never actually get round to it. They’re the ones.

As more and more of these subscription services come along – and as more and more free, open services like the Guardian’s struggle against high costs and stubbornly slow-rising revenues – I begin to ask myself: was I wrong? Was Hepworth always right? Is the only way to make money off content to sell it, as near as dammit directly, to the consumer? Is there nothing to replace good old diligent, careful and skilful subscriber management?

I admit I don’t know. I’ve lost that old certainty. And perhaps that’s all that needs to be said. I’m back on the fence, waiting for proof either way. But what really bothers me is that there might be a third way, and it was a third way which a good number of people pointed out very early on. That third way sees the rapid demise of all the old media, and the emergence of brand new things with low costs, new approaches and disregard for these debates about business models. Things like Buzzfeed and Reddit and, yes, Andrew Sullivan’s paid-for Daily Dish. Maybe you can’t get there from here, after all. Maybe if you’re here, you’re already dead.

I really hope that isn’t the case. But….

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About Lloyd Shepherd

Lloyd is the author of The English Monster and The Poisoned Island. He lives in London, but dreams of Manchester.

Comments

  1. There is always a third way, Lloyd. It does not have to be “free” vs “paid.” And, if paid, it does not have to be a long term subscription plan. There are many additional (or alternative) ways of monetizing content, from the freemium model to on-demand micropayments to donations/crowd-sourcing. It puzzle me, while press publishers do not look at and learn form other legacy industries that have been disrupted by the Internet; the music business, for example, or TV. It does not mean, those others are in the safe now and happy, but at least they are trying. What’s iTunes, if not “micropayments” for single MP3 tracks, as opposed to CDs? Can’t publishers unbundle their content and sell it on the pay-as-you-go-for-what-you-want basis? Can’t they “stream” their regular content and charge for “premium” services just like Spotify does?

    I am also puzzled by the advocates of “free” who oppose (and it used to be, ridicule or smirk at) the idea that it should be the reader who decides whether to pay for content or not. If I lost you here, think about e-wallets and micropayments, criticized so much by Clay Shirky and others gurus of “free” as some sort of get-rich scheme. But what can be more democratic than a system where it is the readers who have the ability to surf the net with pre-paid credits and apply/redeem these credits as they wish, on-demand, anonymously? The current micropayment technologies allow for that.

    You mentioned Andrew Sullivan’s newest project; many people write about it as an example of how the metered subscription model can be applied to blogs — but only a few have noticed that the Dish is supported also through donations and micropayments, and that Andrew wants to build his business from the bottom up, through crowd-sourcing. And this is the third way, and perhaps the best way to succeed in the buyers’ market digital content has become.

  2. I think paywalls need to come into force.

    There is a fundamental problem with the advertising model that I don’t feel can be fixed. The biggest success when it comes to online advertising is Google, they’ve made an empire based on advertising, but their model cannot be copied by a content business. The cost to Google of serving you up a page is fractions of a cent and one clic one a paid advertisement pays for hundreds (thousands?) more pages to be served. It scales indefinitely to all the searches their users make and gives them targeted advertising. It’s a licence to print money.

    A news organisation cannot do that. Their content is finite and very expensive to produce. They have to pay the wages of the Journalist to write the article, each page you see took a paid staff member time to produce. How can you recoup that with advertising that isn’t as well suited to the situation?

    Worse it incentives the wrong goals. Newspapers’ websites have become glorified blogs with Journalists writing quick pieces designed to get pageviews, to get someone to click of that link and sell more advertising space.

    The ‘free’ model is destructive to Journalism in the long run. It will leave us with bloggers and no investigative journalists. Information should be free but Journalism shouldn’t be, it’s a product, it’s a product a society needs, and it costs money to make.

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