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So Far, Newspaper Pay Walls Are a Nonevent

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The New York Times had a story this week, which MediaBisto picked-up in its Morning Media Newsfeed, that the experience so far with pay walls among newspapers -- certain kinds of newspapers and certain kinds of pay walls, at least -- suggests publishers may not have too much to fear from charging for a certain amount of content. The key is how much content. As the Times reported "...the initial findings showed that newspapers found success with a pay model by setting a conservative limit for the number of articles visitors could read free each month, and by making clear that most readers would not be affected."

Conservative seems to mean don't swing for the pay wall fences; keep as much content as possible available for free. In which case, according to Steven Brill, co-founder of Journalism Online, which is the source of the data, pay walls are a "nonevent for 85, 90, 95 percent of the people who come" to the site.

We need to think about those numbers.

The newspapers in the study are reportedly local newspapers such as The Commercial Dispatch in Mississippi and The York Daily Record in Pennsylvania. Large newspapers, with the exception of the Wall Street Journal, have yet to implement their pay wall strategies. The New York Times is scheduled to do so sometime this year. Otherwise, the players in the Journalism Online program are local papers.

Well, yes, but local means 85, 90, 95 percent of all newspapers because there are only three non-local, ersatz large newspapers in the country today: The Wall Street Journal, The New York Times and USA Today. All other papers are local. Therefore, Journalism Online's findings probably apply to 85, 90, 95 percent of all online newspaper readers, which says that you can't make enough money from loyal, regular readers by charging them for content because they account for only 5, 10, 15 percent of the people who come to a newspaper web site.

Thus, it still comes down to the advertising, which appears to be the principal point of relief and discovery in the New York Times story:

"Steven Brill's Journalism Online experiment, which developed a system that allows newspapers to charge their most regular online visitors, has analyzed its preliminary data and found on average that advertising revenue and overall traffic did not decline significantly despite predictions otherwise."

The predictions must have assumed that the majority of online newspaper readers were also "most regular" readers. Now we know, not so. They may be regular newspaper readers, but chances are they high-top it from one newspaper to another, which is one of the gloriously liberating things about online. If you are an avid newspaper reader you don't have to rely on just one anymore.

So why bother charging the 5, 10, or 15 percent of people that frequent a newspaper site who are, without argument, its best customers? That is a very good question. It appears not to make a dent in the business model. It may make a dent in the fears of an anxious newspaper world by offering some validation of their core competency, which is content. And provided papers are supplying extra value to them in the form of news and information, regular readers may appreciate the clubby atmosphere. But in 85, 90, or 95 percent of the cases the results say not much has changed. So far, newspaper pay walls are a nonevent.