Will the public pay to get over the paywall?
A study of the public’s willingness to pay for online news and the impact of paywalls on the journalism industry.
Submitted by Mark McKillen (B00789904) for the award of MA Journalism
To the School of Communication and Media
September 2020
Contents
Chapter 1
Introduction- Page 8
Methodology- Page 10
Chapter 2
Literature Review- Page 17
Chapter 3
Survey Data Analysis- Page 28
Chapter 4
Interviews- Page 34
Interview Analysis- Page 46
Chapter 5
Conclusion-Page 49
Bibliography- Page 51
Appendix A (Owen Jones tweet)- Page 56
Appendix B (Twitter poll)- Page 57
Declaration
This dissertation is entirely the work of the undersigned and has not previously been submitted, in whole, or part as coursework for this or any other course. Except for identified quotations and descriptions of the work of others, none of the following appears in any other work, published or unpublished, by any other person. I understand that any evidence to the contrary may be sufficient cause for the dissertation to be awarded a mark of zero.
The institution has permission to keep, to lend or to copy this thesis in whole or in part, on condition that any such use of the material of the dissertation be duly acknowledged.
Signed: Mark McKillen Date: 3rd September 2020
Candidate: B00789904
Acknowledgments
I would like to thank my supervisor Milne Rowntree for assisting me with this dissertation. He was of great help to me throughout the process and throughout my year on this MA. I would like to wish him well for his retirement.
Summary
This study assesses the economic viability of online paywalls and analyses the impact they are having on the journalism industry, including the sales of print newspapers. During the early days of the internet most online news was free but paywalls became more common after the dot com bubble burst in the early 2000s. Sales of print newspapers are in decline, online advertising revenue is falling and many newspapers hope that paywalls will provide the solution to their financial woes. This study suggests that willingness to pay for online news is low, particularly among the younger and older ends of the population. However, there is more willingness to pay for online news when it is specialised and focuses on a topic such as finance or sport.
Note on Access to Contents
“I hereby declare that with effect from the date on which the dissertation is deposited in the Library of the University of Ulster I permit the Librarian of the University to allow the dissertation to be copied in whole or in part without reference to me on the understanding that such authority applies to the provision of single copies made for study purposes or for the inclusion within the stock of another library. This restriction does not apply to the copying or publication of the title and abstract of the dissertation.
It is a condition of use of this dissertation that anyone who consults it must recognise that the copyright rests with the author and that no quotation from the dissertation and no information derived from it may be published unless the source is properly acknowledged.”
List of Tables
Table 3.1: Survey results for question 1; What is your gender identity?
Table 3.2: Survey results for question 2; what age bracket are you in?
Table 3.3: Survey results for question 3; Do you currently pay any online subscriptions to a newspaper/website?
Table 3.4: Survey results for question 4; If yes, what type of online content do you pay for? If you selected no for question 3, press “not applicable”.
Table 3.5: Survey results for question 5; If no, how likely are you to pay for online news in the future? If you selected yes to question 3, select “not applicable”.
Table 3.6: Survey results for question 6; Do you prefer reading online news or a print newspaper?
Table 3.7: Survey results for question 7; How often do you buy a newspaper?
Chapter 1
Introduction
This dissertation assesses the economic viability of online paywalls. It explores the reasons why newspapers introduce paywalls and if they are economically viable. The history of the paywall debate is outlined and a range of views on the topic are considered. The examples of numerous paywalled newspaper websites across the world are analysed and their economic viability is assessed. The economic viability of a paywall is dependent on variables such as the popularity of the newspaper and the type of paywall chosen. This study also analyses free news websites such as The Guardian and discusses why they do not have a paywall. It is impossible to assess the viability of paywalls without assessing the viability of the alternative model which is free online news. Paywalls are often added to halt the decline of the print edition and prevent “free riders” from getting all their news for free. Expert interviews and an online survey were conducted to add new knowledge to the area of paywall studies which is still in its infancy.
The definition of a paywall is “a virtual barrier between an internet user and a news organization’s online content” (Pickard and Williams, 2014:195). There are different types of paywall, hard and soft. Metered and freemium are the two types of soft paywall. As the name suggests, hard paywalls are the strictest. “Hard paywalls prevent free access to online news content” (Carson, 2015:1025). When a hard paywall is introduced it tends to reduce a website’s traffic 85-95% (Carson, 2015:1032). Soft paywalls allow readers access to a certain amount of free content. “Soft paywall options allow limited viewing, without charge, and are designed to keep internet traffic flowing to a newspaper’s website” (Carson, 2015:1025). The metered paywall is widespread online, it is used by The New York Times and The Spectator. It grants readers access to a certain number of free articles before asking them to pay. The metered paywall is popular because it allows the reader to “try before they buy”. If someone reads five articles they enjoy, it could entice to pay an online subscription. The freemium model means that the website has sections of content which are free and others which are paid. It is used by the websites of The Irish News and The Independent.
The global pandemic has deepened the financial problems facing the journalism industry. News organisations were facing financial difficulties before the pandemic, but these problems are more severe now. The received wisdom has been to make online news free and rely on advertising revenue. The logic is that driving readers to the site will motivate companies to pay for ad space. An increase in online readers has not led to an increase in ad revenue (Thurman and Fletcher, 2018:696). Companies in all industries are being affected by the pandemic and many cannot afford to pay for online advertising. The paywall model is what many news organisations are turning to due to declining advertising revenue. This dissertation shows the reality of the paywall debate and outlines the key arguments from those who support them and those who oppose them.
Methodology
Quantitative and qualitative methods of research methods were used in this dissertation. Expert interviews with journalists and a survey were conducted to gauge opinion about paywalls amongst journalists and the Northern Ireland public. The decision to combine quantitative and qualitative adds greater depth and validity to the research. The survey provides data on the issue whilst the expert interviews provide the human story from journalists currently in the industry. The survey was promoted on social media, it was shared on Facebook and Twitter. A financial reward was included for completing the survey which motivated more users to complete it. Michael Bosnjak and Tracy L. Tuten (2003) concluded that more people complete a survey when a financial incentive is included. Meg Huby and Rhidian Hughes (2001) claimed, “offering incentives to prospective participants elicits interest, encourages participation, and recognizes participant contributions as essential to the research process.” A £25 Amazon voucher was given to one survey respondent after a random draw. The financial incentive needed to be substantial for the completion rate to increase. Surveys can be time consuming and a financial incentive provides someone with more motivation to complete one. Respondents are more likely to answer honestly and have fewer inhibitions when they are anonymous. The online survey was anonymous, this tends to lead to more honest answer than surveys conducted face to face (Aless and Martin, 2010:123).
A straw poll (Appendix 2) was conducted on Twitter before the formal survey was posted. Users were asked if they currently paid any online subscriptions. 32 people responded, 34.4% did pay an online subscription and the remaining 65.6% did not. This cannot be deemed representative of the population, but it suggests that paying for online subscriptions is not fully mainstream. The survey would seek to find the willingness to pay with more detailed questioning. The nature of the Survey Monkey website prevented the survey being conducted as desired. Ideally, respondents would have received different questions depending on whether they paid an online subscription. The third question asked “Do you currently pay any online subscriptions?” and there was a plan that a skip rule would be in place depending on the answer that was chosen. A monthly subscription fee would have to be paid to avail of that service. The solution to this problem was that respondents were told to select the “not applicable” option for the questions that were irrelevant to them.
The survey enhanced the quality and uniqueness of this dissertation. The data accrued from the survey has contributed to new knowledge on the understanding of paywall attitudes in Northern Ireland. Northern Ireland has not featured in any previous studies on paywalls which makes this dissertation particularly important. There have been UK based studies on paywalls such as Jack Herbert and Neil Thurman (2007) but they have omitted Northern Ireland. A study is not “UK based” unless Northern Ireland is included in the research. The literature would benefit from increased studies of attitudes towards paywalls in Northern Ireland. There are limitations to this survey and a more comprehensive NI survey could be conducted in the future. Paywalls are a feature of Northern Irish journalism, for example, The Belfast Telegraph recently erected a hard paywall. The Irish News has long used a freemium model for their online content. This is an issue that affects the news the Northern Ireland public receives online and their opinions need to be known. This information could inform the online strategies of Northern Ireland newspaper as they will be more informed about the views of the public.
The survey consisted of seven questions, any more would have made the survey too long and time consuming. Any fewer would have been too little. The hypothesis was that most respondents would not pay for online content, this was based on the Twitter poll. An additional hypothesis was that there would be a low willingness to pay for online content. It was also assumed that those who buy newspapers regularly would be the elderly. This hypothesis was based on the academic literature on willingness to pay for online content from scholars such as Iris Chyi (2005).
A limitation of the survey is that it lacks external validity. This is mainly because the survey was only shared on social media and not conducted in the field. There was no sampling involved in this survey and none of the data was gathered from face to face interviews. Online surveys have their limitations but using one was the best choice for this dissertation. The argument could be made that internet users without social media accounts have been excluded. These users may pay news subscriptions but cannot be reached on any social media platform. However, this is a relatively small population and the quality of the survey did not suffer due to their exclusion. “People not online would be unlikely to have an opinion on the pricing of online news- and should they have one anyway- it would not be very relevant since they would not be able to actually make the purchase” (Kammer and Boeck et al, 2015:111).
The coronavirus pandemic and rules regarding social distancing rendered face to face interviews difficult. Many people would be uncomfortable with the idea of speaking face to face on a busy high street while social distancing is being enforced. The public have legitimate health and safety concerns that need to be respected and they should not be infringed upon for the sake of a survey. It is understandable that they would feel unsure about answering questions from someone outside of their household at a close physical proximity.
This dissertation’s literature review analyses and critiques the various academic arguments on the paywall debate. A literature review is defined as “information analysis and synthesis, focusing on findings and not simply bibliographic citations, summarizing the substance of the literature and drawing conclusions from it” (Educational Resources Information Center, 1982:85). The views of those who support paywalls, those who oppose them and those with more nuanced positions are discussed and evaluated. A dissertation cannot be completed without engaging with the relevant academic literature on a topic. This is because “a researcher cannot perform significant research without first understanding the literature in the field” (Boole and Beile, 2005:3). The literature review reveals the current state of knowledge on the topic and how it can be improved upon. It is through engaging with the literature that a researcher can develop their own views on a topic. They can filter through what they agree and disagree with. It allows the researcher to separate what has been studied from what needs to be studied.
There is a strong rationale for writing a dissertation about paywalls in the current economic climate. Paywalls have been debated strongly on social media during the coronavirus pandemic. Many on social media argued that public health news should be free. Their view is that locking this information away could create a public health risk and a digital divide where the rich are better informed than the poor (Pickard and Williams, 2014:207). Columnist Owen Jones tried to circumvent the issue by posting screenshots from paywalled articles on Twitter (Appendix 1). This is a novel way of circumventing the paywall which led to Jones receiving a share of praise and criticism for his move. This discourages consumers from paying for online news as they can wait on someone to post the article for free on Twitter. The claim was made that people do not film clips from Netflix shows and post them online.
The wealthiest in society are the most likely to pay digital subscriptions and be exposed to higher quality news than free alternatives. There are still numerous credible free news sources online such as the BBC and The Guardian. The rise of paywalls does not mean free news will automatically disappear. The protestations of the public are understandable and certain publications have responded by dropping their paywalls for Covid-19 related content. The Arkansas Democrat-Gazette maintained the paywall except for articles about the coronavirus (Arkansas Democrat Gazette, 2020). This dissertation adds more reasoned arguments to the paywall debate from respected journalists within their various fields.
The academic literature tends to focus on newspapers in the United States. Whilst general principles can be applied to paywalls, it would be helpful for the current debate if there was more UK based study on the topic. A huge amount has changed regarding online news since then, particularly with the rise of free news on social media. This study can set a precedent for an increased focus on the impact of paywalls in the UK.
Expert interviews have been used throughout the academic literature which inspired their use in this dissertation. The expert interviews conducted in Thurman and Myllylahti’s 2009 article were the main template for the interviews in this piece. The interviews were conducted over email. Face to face and telephone interviews would have been difficult to organise and were not the most appropriate method of acquiring the necessary information. The global pandemic also made in person interviewing less desirable. Most people would be opposed to face to face interviews under the current circumstances regarding social distancing. Organising face to face interviews presents problems and cam prove time consuming. Potential issues include agreeing a meeting place, a time and travel costs. “A major advantage of the email interview is that it offers a convenient and practical alternative to overcome geographical barriers and financial concerns that hinder face to face interviews. (Hawkins, 2018:494) The interviewee can respond when it is convenient. “Written responses of email interviews are typically shorter and more consistently connected to the research topic than oral responses, resulting in shorter, cleaner transcripts” (Hawkins, 2018:497).
The email interview is less time consuming than a face to face interview in terms of transcription. Responses arrive in written form, no transcription from audio is involved. The only additional task that needs to be completed is copy and pasting the response into the dissertation. Transcription is a time-consuming part of an audio recorded interview. When interviews are conducted via email “the written responses are easily converted to transcribed data resulting in significant savings over the typical expenditures for transcribing an interview (Hawkins, 2018:495). It should also be noted that “converting the typical responses of participants directly into transcripts minimises typographical errors and misheard or misunderstood interpretations that are common during transcription from oral recordings (Hawkins, 2018:495).” Mishearing a certain word or phrase can be a major problem when transcribing the audio of an interview. If something is misheard the information could be lost, meaning that the interview and dissertation suffers.
The email interview can be time consuming just like a face to face meeting also. Interviewees may express themselves better in a spoken conversation rather than an email. Answering numerous questions in written form is not to everyone’s taste. The interviewee may be ignorant of the conventions of email interviews and how long their responses should be. The responses to questions for this dissertation varied in length and detail. Some respondents may have elaborated more in a face to face conversation. “Some researchers argue that the written responses of email interviews lack some of the social cues that contribute to a full understanding of the participant’s experience (Hawkins, 2018:496).” An email interview cannot replicate the environment of a conversation where a person is more likely to feel at ease sharing information. The interviewee’s freedom to respond whenever they have time is also a hindrance as well as a benefit. It does not create a sense of urgency and can encourage the interviewee to procrastinate. Despite the problems that email interviews can bring, it was the best method to acquire qualitative data for this dissertation.
Qualitative content analysis was used to analyse the text from these expert interviews. The goal of content analysis is “to provide knowledge and understanding of the phenomenon under study” (Downe-Womboldt,1992:314). Content analysis involves drawing subjective interpretation from text data and connecting it to the relevant themes in the academic literature. This is the process that has taken place in the analysis of these expert interviews on online paywalls. The approach that has been adopted in this study is the most conventional method of content analysis. Key themes were drawn out of the interview responses and connected to the wider themes from the literature review. Five journalists were interviewed on the topic, McCracken (1988) argued that 8 interviewees should be the minimum number for academic research. This study may have benefitted from more interviewees, but quality not quantity was the priority.
Chapter 2
Literature Review
This literature review examines the academic literature on online paywalls and whether they are a viable economic model. There are numerous sub-topics and debates within the field of paywall studies that will be explored. These debates include, why do newspapers have online paywalls, what content do they choose to put behind a paywall, are people willing to pay for online news and what impact do paywalls have on newspaper sales. The literature review covers a range of academic articles and books from authors with differing views on the topic. Paywalls are a recent innovation in journalism and the full ramifications of them have yet to be seen. The study of paywalls is still a niche area within the wider field of journalism studies, but it is growing in prominence as a topic. It seems likely that the amount of scholarly work on paywalls is only going to increase, particularly considering how relevant the debate has been during the coronavirus pandemic.
Until the last decade, most newspapers made their online content free to read. When the internet was in its infancy it was thought that free content was the only model. There were few alternatives available and many organisations thought a paid model would not be sustainable. Alan Mutter (2015) labelled free online news “the original sin” of the Internet. Oliver Franklin-Wallis (2020) criticised the print media for “believing Silicon Valley screeds about information wanting to be free.” The potential financial difficulties that could arise from making content free were not envisioned at the time. Thurman and Myllylahti (2009) looked at the case of Taloussanomat, a newspaper in Finland who made the decision to move away from print and put the newspaper entirely online. Their situation can be compared to the case of The Independent, the only majornewspaper in United Kingdom to cease print production in favour of online. These newspapers had low print sales and decided it would be more cost effective to move entirely online.
The Independent shifted to online as they were experiencing financial problems and their circulation was below 60,000 (Thurman and Fletcher, 2018:1004). Since moving online, The Independent has increased its online readership but is losing out on print revenue and relevancy. A website loses exclusivity when it becomes free to read, it may have more readers, but those readers spend little time on the website. “The Independent may have more readers but it has fewer devotees, and is now a thing more glanced at, it seems, than gorged on. This moves The Independent closer to the sidelines than it used to be.” (Thurman and Fletcher, 2018:1014) The case of The Independent highlights the problem with free online news. Readers value a publication less when they get it for free, there is limited attachment to it. A newspaper is valued more when it costs money. A survey conducted in 2002 revealed that 70% of online adults in the USA could not understand why anyone would pay for online news (Chyi, 2009:597). This emphasises how paying for online news is a niche activity that has not seeped into common behaviour yet.
The consensus is that paid online news does not provide the consumer with enough value to outweigh the subscription cost (Goyanes, 2014:743). The idea that information should be free is deeply ingrained into public opinion, news is viewed as a public service that should be free. Paid online content can only succeed if there is an audience willing to pay for it. The prospective reader needs to be provided with an incentive that would make the subscription fee a worthwhile investment. “Audiences will only in rare instances be inclined to choose the fee-based version over the free-one” (Kammer and Boeck, 2014:114). The knowledge they gain needs to outweigh the financial cost. They will pay for content with unique value that they cannot find for free elsewhere. German newspaper Die Welt (The World) added a paywall to their website welt.de which was studied by Brandstetter and Schamlhofer (2014). Welt.de began charging for their online news without making any noticeable improvement to their content (Brandstetter and Schmalhofer, 2014:503). The reader is getting the same news, but now they are expected to pay for it. Welt.de has little unique content that has not been sourced from news wires or press releases (Brandstetter and Schmalhofer, 2014:502).
Rupert Murdoch, owner of The Times was once vehemently opposed to paywalls. He held the popular belief that online news should be free to access. He thought consumers were unwilling to pay for online news. Apart from exceptions like The Wall Street Journal, paywalls and the idea of charging for online content was unheard of during the internet’s infancy. Alternatives to free news were rarely considered. The Wall Street Journal introduced their paywall in January 1997 which set them apart from other major newspapers (Kammer and Boeck et al, 2015:108). Peter Kann (In Aresse, 2015:1053), CEO of Wall Street Journal’s parent company said, “I made the site paid because I was ignorant, I didn’t know any better. I just thought people should pay for content.” Murdoch eventually subscribed to Kann’s way of thinking and became a convert to the paywall cause (Chiou and Tucker, 2013). Murdoch’s new ethos was that “consumers are willing to pay to be entertained and informed” (Chiou and Tucker, 2013:61). Consumers are more willing to pay to be entertained than to be informed generally. A paywall would provide his journalists with an incentive to report stories that are not only informative, but marketable.
Murdoch acted on his new philosophy, placing The Times behind a paywall in 2010. Paywalls were common globally by 2010 but were still rare in the UK. The Times’ online audience fell by 90% when they erected a paywall, they were subject to widespreadcriticism at the time (Halliday, 2010). Losing most of the online audience is a common by-product of a newspaper introducing a paywall. The Gannet newspaper group in the United States lost 51% of its online audience when their websites went behind paywalls. This included losing 99% of their readers aged 18-24 (Chiou and Tucker, 2013:62). Chiou and Tucker (2013:62) stressed the impact paywalls have on young readers, “The introduction of paywalls disproportionately excludes the young which undermines the creation of a comprehensive community.” Problems undoubtedly arise from having a paywall, but the positives can outweigh the negatives.
The willingness of consumers to pay for online news is a central debate in the academic literature. Willingness to pay is “the maximum amount one is willing to pay for a product, which is the inevitable outcome and ultimate measure of competition” (Chyi, 2012:231). Goyanes (2014:753) stated, “understanding determinants and factors of paying intent for online news is crucial to the functioning and sustainability of online newspapers with paid content strategies.” Any newspaper considering introducing a paywall needs to be aware of what consumers are willing to pay for. When a newspaper adds an online paywall, they assume that their readers are willing to pay for their online news. The introduction of a paywall always brings uncertainty. In the news industry, “the crucial uncertainty for the future is audience’s willingness to pay for [online] news” (van der Wurff, 2012). However, the prevailing view in the literature is that most consumers do not want to pay for online news. 82% of US online news readers said they would go elsewhere if their preferred site introduced a paywall (Kammer and Boeck et al, 2014:109).
Introducing a paywall for news content comes with considerable risk. Robert Picard and Luca Naldi (2012) highlighted the dangers of overestimating how popular a paywall will be. INDenver Times was a subscription-based news website that was established after the dissolution of the Rocky Mountain News in 2009. Denver, Colorado had a journalistic vacuum after the collapse of Rocky Mountain News that INDenver Times sought to exploit. The hope was that loyal readers of Rocky Mountain News would shift their allegiance to the new website in the absence of a newspaper. However, INDenver Times proved less popular than its founders hoped. Their estimation was that 50,000 readers would subscribe, but only 3,000 readers would subscribe to the website (Picard and Naldi, 2012:78). It ceased operating shortly after its inception. This shows that loyal print readers and online news subscribers are different demographics. It is wrong to assume that regular print newspaper buyers are willing to pay for their online news. Rocky Mountain News was an established newspaper brand that had been in Denver for 150 years, INDenver Times was a news website with no history. The prospective subscriber would have more doubts about the content quality of a newly formed website than a well-established newspaper. Picard and Naldi (2012) exemplify the difficulty of encouraging consumers to pay for online news.
Specialised content on topics such as finance and sport often succeeds when paywalled. These topics rely on specialist opinion and insight from expert figures. General news content lacks the specialisation that sets financial and sporting news apart. Herbert and Thurman (2007:215) recognised that consumers pay for specialised news and said, “it is impossible to charge for general news content.” A weekly column from a CEO or from a Premier League winning manager is content that readers are likely to pay for. General news is widely available on television, radio and social media which makes paying for it seem futile. Consumers only want to pay a subscription for news content and opinions they cannot access elsewhere. Opinion pieces are most likely to be placed behind the paywall (Kvalheim, 2020). This is because newspapers place the content they value the most behind the paywall. In the case of freemium websites, the paid content tends to be hard news and opinion pieces. Kvalheim (2020:30) stated that deciding what content to put behind the paywall can “be viewed as a combination of journalistic considerations, the commercial characteristics of news and what newspapers think the public is interested in paying for.”
Financial news succeeds behind the paywall because it targets a niche wealthy audience. Not everyone who reads financial news is wealthy but the typical subscriber to the Financial Times or Wall Street Journal would have an above average income. Paywalled content often succeeds when it is targeting a specific audience with a high willingness to pay. The Financial Times implemented a paywall in 2002, they offer exclusive content and do not need mass market appeal. The FT feel they can charge for online content because “we think we produce valuable, often price sensitive and exclusive information that has a value” (Herbert and Thurman, 2007:216). Talousannomat is an example of a free financial news website and their free model often leads them to compromise on journalistic principles. They resort to clickbait and celebrity gossip to attract readers (Thurman and Myllylahti, 2009:699). Financial news is always in the public interest, but the public will only read news that provides them with value. Taloussanomat’s content is largely sourced from news wires and press releases whereas paywalled websites like The Financial Times produce more original content. Richard Withey declared that unique news sites “will continue to be the ones who charge most and have the highest walled gardens” (Herbert and Thurman, 2007:216). The paywalled FT model is sustainable if the regular wealthy readers are content with the quality of news and opinion. If the Financial Times and Wall Street Journal tried appealing to a broader audience like Taloussanomat, they could alienate their pre-existing loyal readers.
Sports journalism has loyal readers who are willing to pay for online content. This has been exemplified by the success of The Athletic, a sports journalism website formed in San Francisco in 2016. The Athletic UK was formed in August 2019 and has become a market leader in online sports journalism. The Athletic which operates a hard paywall model attracted prominent sports journalists from major UK newspapers like The Guardian and Yorkshire Post. They occasionally drop their paywall for certain articles to raise awareness of their content. They hope that seeing a glimpse of their news would encourage prospective readers to pay the full subscription fee. Ed Malyon (managing director of The Athletic UK), justified the model by saying that it is the cost of a cup of coffee (2019). Malyon’s defence of paywalls is like Walter Lippmann’s defence of paid newspapers in Public Opinion. Lippmann thought that paying for news was relatively cheap when compared with all the commodities consumers buy throughout the day. Lippmann (1922:204) stated, “It would be regarded as an outrage to have to pay openly the price of a good ice cream soda for all the news of the world. Though the public will buy that and more when it buys the advertised commodities.”
Lippmann believed that consumers pay for the news directly or indirectly by buying the products that fund free journalism.Malyon (2019) stated, “Putting up a paywall is not The Athletic being greedy. This is a three-year-old start up and all of the money we receive right now gets invested back into improving the product.” Cook and Attari (2012) suggested that consumers are more willing to pay when the reason to charge has been justified like this. Malyon and Lippmann argue that we often spend money frivolously on ephemeral commodities such as coffee with little consideration for the price. If this money were spent on news content instead, the price would not be steep at all. They want to show news is affordable when compared to what else we spend money on every day. When consumers are told that their subscription is the same as one coffee, it makes the price seem less daunting. The Athletic website is ad free which is another factor that motivates consumers to subscribe. They are not just receiving “the best sports writing on the planet” (Malyon, 2019), they are getting a seamless reading experience, free of intrusive advertising. Free news websites rely on advertising which often leads to pop up ads and videos which disturbs the process of reading articles. Many users are willing to pay a fee for a more comfortable reading experience. Online subscriptions tend to be less expensive than regularly paying for a print newspaper.
Opposition to paywalls is perhaps more ideological than it is based on price. It is based on a view that online information should be free, and that information is restricted once a price is put on it. Malyon (2019) reiterated the relatively low price by stating, “I hate the price comparison with coffee so let’s just say it is a half a kebab. Or a Diet Coke at an airport. It’s 8p a day. To read the best sports writing outlet anywhere.” This is reminiscent of a Walter Lippmann quote from Public Opinion. Lippmann (1922:204) wrote, “The citizen will pay for his telephone, his rail road rides, his motorcar, his entertainment. But he does not pay openly for his news.” The Athletic have begun to experience financial difficulties recently. They laid off 46 employees which was 8% of their workforce. They also cut pay across their workforce by 10%, Time will tell how successful The Athletic’s hard paywall model will prove.
Cannibalisation is the name of the phenomenon where the popularity of a newspaper’s free website contributes to the decline of the print version. Paywalls exist because “offering the online content for free would remove the incentive for anyone to purchase the printed newspaper, thus eroding print sales” (Herbert and Thurman, 2007:211). There are different ways of viewing the relationship between a newspaper’s website and the print version. A website can be viewed as complementary to the print version or a substitute for it. Cannibalisation happens when the free website becomes a replacement for the print version. In 2006 The Guardian launched a web first policy, publishing articles online before the print edition. Their official stance was “we will take the internet seriously, but we must not let it get in the way of our primary business, which is publishing a paper each night” (Fletcher, 2006). Regardless of their intent, the website has surpassed the print edition in popularity terms. The popularity of The Guardian’s website at the expense of the print version is a prominent example of cannibalisation.
The Guardian are opposed to erecting a paywall. This is despite significant financial losses and redundancies at the paper. Iris Chyi disputed the idea of cannibalisation, arguing that a free website had a minimal impact on print sales. Chyi (2009:596) did not believe that the website had become an alternative to the print version. However, the sales of The Guardian’s print edition that cannibalisation is real and having an impact on print. In 2019, The Guardian’s circulation was 130,484, 53,000 sales fewer than The Daily Star (Mayhew, 2019). Due to their large global readership, it is likely that a paywalled Guardian website would succeed. A paywall would mean that none of their news is being read for free, every reader is making a financial contribution. However, there are readers who read a newspaper’s website and also buy the print paper. They are dedicated to the outlet and want to contribute financially so that journalism can continue to be produced.
Introducing a paywall can protect a newspaper’s print edition. There is no risk of cannibalisation when an online paywall is on the website. The presence of a paywall informs readers that none of this newspaper’s content will be free. Readers are more likely to pay for a print newspaper when they cannot access the same content for free online. A paywalled newspaper does not have any casual readers who occasionally look at the website. Everyone who is reading online or in print is contributing capital to the newspaper. 15,000 users signed up for The Times paywall after it was launched. Paradoxically, a paywall does not need huge amounts of subscribers to be successful. Chyi (2012:242) asked the rhetorical question, “why would newspapers pursue the subscription plan, knowing that the paywall may turn away the majority of users, whom they have always been striving to save?” The paywall acts as a defence mechanism against the cannibalisation of the newspaper’s content. “Simply because no one would pay, does not mean newspapers should not charge for it” (Chyi, 2012:243).
28% of news executives in the United States implemented a paywall to protect their print edition (Chyi, 2012:243). 35% of daily newspaper publishers in the US believed that introducing a paywall would halt the decline of their print edition (Jenner and Fleming, 2011). The Arkansas Democrat Gazette is an example of a newspaper who erected a paywall to protect their print edition. Journalism costs money to produce and a financially savvy newspaper seeks to maximize reader contributions. “When someone buys a newspaper, they make a financial investment in the product” (Thurman and Myllyalahti, 2009:696) The print reader is a newspaper’s most valuable reader. “An average print reader brings in 16 to 228 times more in advertising than an online reader” (Pattabhiramaiah and Manchanda, 2019:28). In the case of the New York Times, in 2014, print readers generated $1100 per year, whereas the digital subscriber generated $175 per year (Pickard and Williams, 2014:206). It has been estimated that 20-100 online readers are needed to make up the loss of one print reader (The Economist, 2006).
Many prominent journalistic academics are vehemently opposed to online paywalls, Victor Pickard and Merja Myllylahti being the most well-known. Their core argument against paywalls is that they have commodified news. Commodification was defined by Vincent Mosco (2009:132) as the process where “products which meet individual and social needs change into products whose value is set by what they can bring into the marketplace.” Their view is that informing the public is more important than profit. Truth and information is the highest ideal rather than financial gain. Pickard and Myllylahti state that the paywall has commodified news, overlooking the fact that news has been a commodity for centuries. The creation of the newspaper meets Mosco’s definition of commodification, the newspaper made news a commodity which had to be bought. It is myopic to treat charging for news content as something new when newspapers are bought across the world every day. A commodity is defined as “a substance or product that can be traded, bought or sold.” A newspaper meets this description perfectly. Pickard and Williams (2014) stated, “If news is treated as a commodity, then it is rational to maximize profits by any means possible.” When studying the literature around the financing of journalism, it is important to step away from the paywall debate and look at newspapers. The paywall around print newspapers receives a lot less attention than their online counterparts. It is viewed as socially unacceptable to walk into a shop and start reading the newspaper without paying it. This was the old-fashioned way of viewing screenshots from a paywalled article for free on Twitter. Walter Lippmann, acclaimed journalist, and public intellectual of the 20th century, covered the debate around paying for newspapers in his 1922 book Public Opinion.
Victor Pickard does not believe that paywalls are an economically viable model for online news content. He shares the view of Merja Myllylahti that the presence of online paywalls creates a digital divide between those who can afford to pay and those who cannot. Pickard has suggested that more journalism needs to be publicly funded. Opponents would argue that publicly funded journalism merely shifts the production costs to the taxpayer. Journalism will always cost money whether it is paid for in subscription fees or in taxes. Benson (2019) supports Pickard in his calls for more publicly funded journalism. Pickard cites the case of the BBC as an example of successful publicly funded journalism. The BBC has been long established as a public institution in the United Kingdom whereas in the United States there is more opposition to public broadcasting. Public broadcasters such as PBS exist but they are not major players when compared to CNN and Fox News. Victor Pickard and AT Williams (2014) organised their opposition to paywalls into three distinct categories. They highlighted the legal, economic and democratic problems with paywalls. They believe that free online news is held in low regard and is a common enemy within the newspaper industry. Pickard and Williams (2014:198) disagree with this theory, they do not believe free news is to blame for journalism’s financial woes. Merja Myllylahti shares their opposition to paywalls. Myllylahti (2014:190) stated “charging for news content has the potential to create a new digital divide between those who can afford to pay for the news, and those who cannot. It also raises a question about the role of publicly funded journalism.” The idea of a digital divide is also supported by Pickard and Williams. They stated, “paywalls defy the internet principle of openness; they disenfranchise people unable to afford the digital subscription cost; they further inscribe commercial values into the newsgathering process.” (Pickard and Williams, 2014:207)
Chapter 3
Survey Data Analysis
The survey which was creating on Survey Monkey was completed by 40 respondents. 40 was the maximum number of respondents that could complete the survey under the free Survey Monkey plan. It would have been beneficial for the reliability of the data and the strength of the dissertation if the survey had more respondents. However, the financial cost of allowing more respondents to complete the survey unfortunately proved too expensive for the purposes of this single survey.
This survey consisted of seven questions, the first two questions dealt with the gender and age of the respondent. The remaining five questions dealt with the respondent’s attitude towards online news content and print newspapers.
Question 1: What is your gender identity?
There were three options for this question, male, female, and other so the survey was not exclusionary to anyone on the grounds of gender. The 40 respondents who completed the survey were all either male or female, 23 were female and 17 were male. Previous surveys on paywalls have not included information on gender, they are included in this survey. There may not be any correlation between gender and willingness to pay but it is an area worth analysing.
Table 3.1
| Male | 17 |
| Female | 23 |
Question 2: What age bracket are you in?
Rather than asking respondents their exact age, the survey asked them to place themselves in the appropriate gage bracket. This efficiently puts the respondents into their appropriate category rather than organising them based on their individual ages.
The number of respondents from each age group that completed the survey are detailed in the table below.
Table 3.2
| Under 18 | 1 Respondent |
| 18-24 | 16 Respondents |
| 25-34 | 6 Respondents |
| 35-44 | 3 Respondents |
| 45-54 | 4 Respondents |
| 55-64 | 6 Respondents |
| 65+ | 4 Respondents |
Question 3: Do you currently pay any online news subscriptions to a newspaper/website?
This question sought to understand how popular or unpopular paid news content is in Northern Ireland. The hypothesis was that most respondents would not pay for online news. 8 respondents pay for their online news, 32 do not. In percentage terms, 20% of respondents pay whilst 80% of respondents do not.
Table 3.3
| Yes | 8 |
| No | 32 |
Question 4: If yes, what type of online content do you pay for?
Online news comes in various categories and this question asked respondents what type of news they pay for. There were 7 options to choose from. An online newspaper subscription, general news, fashion/lifestyle content, financial news, sport news and other.
This question was not applicable for 78.95% (30 respondents) of respondents because they answered no to question 3. If a respondent answered no to question 3, they were directed to choose the “not applicable” option. Of those who do pay for online content, 7.89% (3 respondents) pay for online newspapers, no respondents pay for general news, no respondents pay for fashion/lifestyle content, 1 respondent pays for financial news, 5 respondents pay for sports news and 1 respondent pays a print and digital subscription to a newspaper.
These responses support many of the claims from the literature review, mainly that consumers are unwilling to pay for general online news. This is the news that they can find for free on social media or on a website like the BBC or The Guardian. It proves that specialised content on niche topics is what consumers are most likely to pay for. The assumption can be made that the 5 respondents who pay for sport news are paying a subscription to The Athletic. This may not be the case but it is the most popular hard paywalled sports website.
Table 3.4
| Online Newspaper Subscription | 3 |
| General News | 0 |
| Fashion/Lifestyle | 0 |
| Financial News | 1 |
| Sport News | 5 |
| Not Applicable | 30 |
| Other (please specify) | 1 (Print and digital) |
Question 5: If no, how likely are you to pay for online news in the future?
This question is directed towards the respondents who answered no to question 3, these are the respondents that do not pay for any of their online news. A consumer may not pay for online news currently but that does not mean they will never pay for it in the future. This question sought to understand what the future willingness to pay was amongst these respondents. This data suggests that the willingness to pay for online content is quite low among the people of Northern Ireland. Online publishers would find it concerning that only 3 respondents stated that they would be very likely to pay for online content.
Table 3.5
| Very Likely to Pay | 3 |
| Likely to Pay | 5 |
| Somewhat Likely to Pay | 3 |
| Somewhat Unlikely to Pay | 1 |
| Unlikely to Pay | 9 |
| Very Unlikely to Pay | 9 |
| Not Applicable | 10 |
Question 6: Do you prefer reading online news or a print newspaper?
This question is about what respondent’s preferred medium of reading the news is. The information gathered from this question indicates consumer attitudes to different mediums and informs us about Northern Ireland’s reading habits. An interesting phenomenon from the data is that many respondents stated that they prefer reading a newspaper, but also rarely buy one. On the surface this seems quite contradictory. It could be because they like reading a newspaper occasionally but do not want to make the financial outlay for one. More respondents prefer reading a newspaper than reading online news but perhaps feel that online news is more convenient. The process of reading online news could be purely functional whereas there is more enjoyment in reading a newspaper.
Table 3.6
| Prefer Online News | 15 |
| Prefer Print Newspaper | 19 |
| Don’t prefer one over the other | 6 |
Question 7: How often do you buy a newspaper?
Paying for an online subscription and regularly buying a print newspaper are not mutually exclusive. One respondent pays an online subscription to a sports website and also chose print as his preferred medium. The number of respondents who very rarely or never buy a print newspaper (20) is the same as those who buy one daily, once or twice a week or occasionally (20). This indicates that print newspapers are not quite experiencing a terminal decline but their popularity is waning slightly.
Table 3.7
| Daily | 7 |
| Once or twice a week | 6 |
| Occasionally | 7 |
| Very rarely | 11 |
| Never | 9 |
The only person aged under 18 to complete the survey indicated that they would be likely to pay for online news in the future. This is only the views of one person and is not representative of the youth population’s attitude towards paid content. However, it does show that the willingness to pay for online content exists among young people. The rise of paid streaming services such as Amazon Prime and Netflix has made them familiar with paid subscriptions. This generation could have more willingness to pay than the 18-24 demographic who were used to online content being free.
The data suggests that those aged 55-64 and 65+ are the most likely to regularly buy a print newspaper and the least likely to pay for online content. They also are more likely to prefer reading a print newspaper to reading online news. The survey data collected indicates that those who pay for online sports news tend to be male. Every person who paid for online sports new on this survey was male.
There are notable limitations to this survey, mainly the small sample size. The opinions of 40 people on the issues of online content and print newspapers cannot be viewed as representative of the wider population. However, this is the largest sample that could be gathered under the current circumstances and due to the restriction of the Survey Monkey website. One positive despite the small sample size is that every age bracket had at least one respondent. This allows some conclusions, imperfect they may be, to be drawn about age and the willingness to pay for online news. The data would have been more reliable if each age group had more respondents so more accurate conclusions could be drawn.
Chapter 4
Interviews
Gabriele Marcotti Interview
Question 1: Explain your opposition to websites like The Guardian publishing all their content for free online. What impact do you think it is having on newspaper sales?
The opposition has both ethical and commercial considerations. The commercial considerations are evident to me. This is the equivalent of selling products at a loss to gain market share (dumping) and it’s hugely damaging to an industry. It was doubly damaging in this case because the Guardian (and others, to be fair) thought they could support themselves through online advertising which, as we saw, turned out to be a chimera. Audiences were too sophisticated to click on banner ads and, these days, online advertising has either dried up entirely or been replaced by advertorials and paid content and other garbage. And if you can’t generate revenue, you can’t invest in journalism, particularly the sort of investigative journalism that costs money and gives readers a sense of added value.
The ethical consideration is simple. If you have subscribers as your main source of revenue you have to primarily answer to them. And they will, ideally, be a wide-ranging group of people with diverse interests. If your main source of revenue is advertisers, then you will have a much more limited source of revenue and, crucially, a source of revenue that’s driven by a desire for profit for shareholders. And this, in turn, will make a media outlet far more vulnerable to pressure and less independent.
Question 2: What is your opinion on the Athletic UK having a paywall and do you think it will be sustainable? Are people willing to pay for online sports journalism when free alternatives exist?
I think the Athletic model is good for journalism. And, if it succeeds, it can form a blueprint in other fields such as politics or foreign reporting. (Business reporting, to some degree, is already paywalled). If it’s qualitative enough and comprehensive enough, people pay for it, regardless of free alternatives. It’s a certain kind of journalism and it might not have a huge following, but given the lack of distribution costs I think it can be sustainable.
Question 3: What do you think of arguments against paywalls? Many have said that paywalls contradict journalism’s function of informing the public and are purely about profit.
With respect, those are foolish arguments. First and foremost, if there is a major story of public interest and it appears behind a paywall it will very quickly spread across TV, radio and free websites (not to mention wire services). That part is easy. The difficult part is getting the major story of public interest and that’s what cost money and that’s why paywalls are necessary. As for the public being informed, there’s the BBC and a host of other free services. It’s not as if knowledge/information is being hoarded and hidden away.
Oli-Franklin Wallis Interview
Question 1: If you were starting your own news website from scratch, what online model would you adopt sand why?
The honest answer is: I wouldn’t. But generally, I think that paywalls – with some mechanism for free sharing – are the only way to continue to fund journalism online given the total loss of advertising revenue to Facebook and Google. The major challenge is not just the loss of advertising revenue but the inherent monopoly-driving tendencies of network effects, such that it’s likely that online journalism will be dominated by a very small number of large companies.
Question 2: Why do you think many people are willing to buy a newspaper everyday but are reluctant to pay for online news?
The main problems are: oversupply of free news; little difference in perceived quality of breaking news from different sources; and the ridiculous levels of friction to sign up and/or pay for most online news. The primacy of subscription models over single purchase is a big obstacle for many readers – we’ve simply not been able to create the experience of buying a single newspaper or magazine.
Question 3: How economically viable do you believe the hard paywall model to be?
It entirely depends on the brand. There are a number of examples of businesses – The Information, Stratechery, etc – that run hard paywalls and have thrived. But hard paywalls are usually most effective for publications with unique, niche coverage that subscribers can’t get elsewhere.
Question 4: What problems, if any, do you think arise from providing news content for free eg The Guardian?
Free news will always exist, as there will always be a demand for it. The voluntary funding model of the Guardian is a decent attempt at striking the balance between scale of audience and reader revenue, however the cost of operating a high quality media organisation at that scale does seem difficult for multiple organisations to achieve. (That is: not a lot of organisations can be The Guardian.)
Chris Sherrard Interview
Question 1: The Belfast Live website is free to read online, why do you believe this model is suitable for the website?
Our primary focus on Belfast Live has always been live, breaking news and I’ve always been of the view that people won’t pay for that. Why? Because we operate in a marketplace which contains the BBC which has massive resources and is able to provide free news on its platforms. I’d rather compete with them, and others, in that space than disappear behind a paywall and funnel all the readers towards them.
Question 2: What is your opinion on the increasing frequency of online paywalls for newspapers and other news sites?
I understand why they’re doing it and I admire them for taking the step to do it. It comes down to your definition of success and if that’s customer registrations and being able to directly communicate with readers who you know more about and can fully serve that relationship then it can certainly work.
Question 3: How willing do you think people are to pay for online news?
I have never thought people will pay for general, breaking news. If they’re going to pay for something it needs to be suitably different and feel like premium content. Where this works well, it seems to me, is with interesting and insightful columnists whose views readers are happy to pay to read.
Question 4: What impact do you think free news online is having on the newspaper industry?
Newspaper circulation figures were on a decline before the rapid ascent of online news coverage. How much it has contributed to it is open to debate. I think there will always be a market for print, certainly for national newspapers like we have with the Daily Mirror.
William Scholes Interview
- Question 1: What is your opinion on the online model of the Irish News with a mixture of free and paid content?
We don’t give away the printed paper for free, so why should you give away the same content for nothing online? That doesn’t make sense, unless perhaps there’s an abundance of lucrative online advertising to pay for it. And of course online advertising is anything but lucrative. Separately, the Irish News has traditionally not engaged in the practice of dishing out ‘bulks’ i.e. the bundles of free newspapers that you can pick up in train stations, hotels and so on. Other titles do this to inflate their circulation figures. I joined the Irish News from a publisher in Britain who loved bulks. I remember asking why the Irish News didn’t do it and a very senior figure asked why should we give away anything for free, and if we didn’t value the product, then why would readers and advertisers? (if you drill into the detail of ABC circulation figures, you’ll see our ‘not paid for’ copies are tiny). So I think there’s a philosophy of not giving away content.
The fact the Irish News is a standalone, independent (family-owned) title is probably a factor, too. Other Belfast titles are part of large groups who are taking group-wide decisions in a business model that may not be that nuanced for local factors. That does mean they get access to the back-office type expertise for websites/digital too. The Irish News would be keenly aware that it has to do these things on its own, i.e. it’s a relatively larger investment for us.
Another reason for what some might regard as a measured or cautious approach to digital is that the Irish News circulation is still strong and, as mentioned earlier, strongly made up of full-price paid-for copies. So the push-factor to get into digital quickly in a free-for-all way isn’t there to the same extent that it might be elsewhere.
So a site which is essentially subscription-based is more sustainable from a business point of view. The digital ad revenue simply isn’t there otherwise.
Question 2: Do you believe there is much willingness from the public to pay for online content?
Yes. There are notable examples where this has worked very well – the Financial Times and The Economist have long been held up as paragons of making paid-for content work. More recently, The Spectator has been thriving with its subscription model. They all have specialist content, of course. It’s trickier for a general daily newspaper because there are simply so many sources for ‘news’, from smartphone notifications to the radio to the 10 o’clock news on TV. It’s everywhere! And all of that stuff is free, or effectively free. I suppose that’s where a title has to know its readers and its own identity, and have the confidence to offer something different from and beyond the generally available free material. In our case that would be comment/opinion (I’m obviously biased, but I don’t think any of our competitors has the breadth and depth across the week that the Irish News has, in subject matter as well as political position) and sport. But our ‘take’ on the big running stories – those ones that everyone is covering, like coronavirus, the Bobby Storey funeral, etc – still seems to appeal to readers and does well in print and online. Exclusive stories help too – as long as I’ve been at the Irish News, there has been a tradition of leading with or developing stories that are different from what everyone else is running with. That works online, too, it seems. It’s very hard for a newspaper (like the Irish News) to try and do breaking news – that is just so resource-intensive, and inevitably means you are distracted from actually developing and researching your own stories and doing the analysis/comment/opinion on those stories… which is the stuff that people will perhaps pay for.
Question 3: What is your opinion on free online news such as The Guardian website? What do you think it means for print journalism sales?
I think since I last emailed with you about The Guardian, it’s announced redundancies across its departments. I suspect that’s the answer to your question. Even an organisation with the trust fund safety net under it that The Guardian benefits from can’t sustain an operation that to all intents and purposes looked like it was trying to ape the BBC (there’s another question for The Guardian about whether there is a substantial audience for its political point of view – perhaps not?). It’s free online operation certainly hasn’t been good for its print operation. As per comments in earlier answers, how can it surprise anyone if a business gets into difficulty by giving away its assets?
Question 4: Does the presence of paywalls create a digital divide between those who can afford to pay for high quality news and those who cannot?
I see where you might be coming from with the digital divide question – but do digital subscriptions not tend to be cheaper than buying the printed paper?
A general point might be around the importance of social media in driving traffic to newspaper/publisher websites. Almost no-one goes to the Irish News website home page and navigates around it like a pseudo copy of the printed paper – vast majority of traffic on our site arrives there from social (or our own emails/newsletters, which is kind of the same thing). I believe that’s the case for almost all newspapers. So effective social media/digital teams are incredibly important.
The other side of that is the fact that a lot of our subscribers like the e-paper approach – basically a digital version of the printed paper via the app (personally, I prefer that too!). It’s usually available just after midnight and I know that people will look at the next morning’s paper before they go to sleep, if you follow me. To them, I suppose it’s like getting the printed paper extra-early (I’ve regular correspondents who will email me after midnight and one man in particular who gets up extremely early and will have often emailed or DM’d me at 4.30am about something in that day’s paper). I’m led to believe this has done well for us during lockdown).
On top of all the digital upheaval, coronavirus won’t have helped anyone. Advertising simply stopped for three or four months, and that will have a big effect on the industry once things have settled down a little. I suspect that will render conversations about paywalls and websites redundant in a lot of cases…
Una Murphy Interview
VIEWdigital is a community media publisher based in Belfast. We first published VIEW social affairs magazine in 2012 and incorporated as a Community Interest Company in 2013 after completing the Invest NI Social Enterprise Programme.
Our aim is to produce social affairs journalism to a professional standard in VIEW magazine and on the VIEWdigital.org news website. We produce high quality, in-depth journalism through themed magazines on social issues that impact communities that are under-served by the mainstream media such as addiction, palliative care and the housing crisis. Our website (www.viewdigital.org) is a platform for social affairs and community stories in Northern Ireland and our archive of VIEW magazines is part of a free-to-use and accessible back catalogue on the website: https://viewdigital.org/category/magazines/ Each magazine is produced in collaboration with an expert as a guest editor including ‘experts through experience’ in our community.
VIEWdigital seeks sponsors from third sector and public sector organisations for each edition of VIEW magazine. We also apply for grants from charitable trusts and philanthropists. In addition to sponsorship we receive advertising from time to time and generate revenue from our monthly e-newsletter as well as our website. We are currently examining ‘softer’ paywalls such as ‘pay if you can’ from Axate and membership plugins such as Steady for the VIEWdigital.org website.
We developed a ‘Champion’ members scheme in 2017 for individuals and organisations who wanted to financially support independent social affairs journalism. We also developed a paid subscribers scheme in 2020 for people who would like a printed copy of VIEW magazine delivered to their doorstep. The digital edition of VIEW magazine is free and sent by email to people who have signed-up on our website or who access VIEWdigital social media channels Facebook: https://www.facebook.com/VIEWdigital.team and Twitter: https://twitter.com/VIEWdigital
VIEWdigital is a community media publisher which produces social affairs journalism. We need to generate revenue to pay for our journalism however we focus on sponsorship and grants rather than getting revenue from our readership at present. We ensure there is a contract with sponsors so they understand our impartiality as journalists will not be undermined.
Specialised news content behind a paywall is economically viable as shown by the Financial Times. Most readers expect free online content and those who chose to pay do so because of distinctive content, convenience/price or support the ‘mission’ of journalism – like the Guardian or the New York Times.
The move to digital-first by traditional ‘legacy’ media outlets has had a huge impact on print journalism, particularly newspapers. Magazine print and digital editions, with specialised content and aimed at niche audiences have been the journalism format which has attracted sponsors and generated revenue for the community media publishing business I co-founded with Brian Pelan.
VIEWdigital is producing a premium print product (VIEW social affairs magazine), a monthly e-newsletter and in the future would like to develop podcasts. Changing business models are needed to support journalism but at the moment no-one has all the answers.
Interview Analysis
Gabriele Marcotti is an Italian-American sports journalist who works for ESPN. He is a supporter of paywalls for online journalistic content. He thinks the process of making online news free has discouraged the public from paying for news, they expect it to be free. He shares the view of Iris Chyi that people will not pay for something they are used to getting for free. Marcotti echoes Alan Mutter’s view that free online content is the “original sin” of the internet. Marcotti believes the subscription model is more transparent than a free model that relies on advertising revenue. It is better for the readers to hold the power rather than businesses which can dictate the content published by an outlet. He offered a perspective that did not feature in the academic literature. It was that readers are too sophisticated to be swayed by pop ups and online banner advertising. “Audiences were too sophisticated to click on banner ads, and these days, online advertising has dried up entirely or been replaced by advertorials and paid content and other garbage.” He supports the view that paywalled content succeeds when it is specialised and centres on a singular topic. He echoes the common theme in the literature that consumers will pay for content that offers them unique value. “If it’s qualitative enough and comprehensive enough, people pay for it, regardless of free alternatives.” Pickard and Myllylahti’s view that paywalls lead to a digital divide is challenged by Marcotti. He stated that this is a foolish argument as there are more than enough free news outlets to keep the public informed. “As for the public being informed, there’s the BBC and a host of other free sources. It’s not as if knowledge/information is being hoarded and hidden away.”
Oli Franklin Wallis is a freelance journalist who has written for GQ. He wrote an article for GQ about the hard paywall strategy of The Athletic. He shared Marcotti’s view that paywalls are a necessary means of funding online journalism. He believes that a balance needs to be struck between paid and free online news content. The internet should not be charging for all online news content. Franklin Wallis mentions an issue that was not discussed in the academic literature, that many people do not pay for online news due to the perceived difficulty and lengthy nature of the signing up process. Like Marcotti and other academics, Franklin Wallis stated that paywalled content succeeds when it is specialised. He recognised that problems arise from free online news and organisations providing free news need to have significant funding.
Chris Sherrard is the editor of Belfast Live, a free news website owned by Reach PLC that provides news content about Northern Ireland. Chris supports the idea argued in the literature that consumers are not willing to pay for general breaking news. He recognises that breaking news is available for free across the internet so it would be foolish to charge for it. He clarified this view, declaring, “I have never thought people will pay for general breaking news. If they’re going to pay for something it needs to be suitably different and feel like premium content.” Sherrard, Franklin Wallis and Marcotti agree with the principle that niche journalistic content sells online. Belfast Live’s news content is general and could not be compared to specialist outlets like The Financial Times, hence why they do not have a paywall.
William Scholes is the religious affairs correspondent of The Irish News. He is a supporter of online paywalls and echoes the views of Rupert Murdoch that news should not be given away for free. His response drew parallels to the literature review discussion about Walter Lippmann and paid newspapers. Scholes made the point that we do not expect print newspapers to be free so why should it be different for online news? He backs Marcotti’s view that free online news is causing financial damage to the journalism industry. He references the success of financial publications like The Financial Times and The Economist behind the paywall. Once again the idea that consumers will pay for quality content is being reaffirmed. Scholes believes that The Guardian is suffering the effects of cannibalisation as sales of its print edition are falling due to the popularity of their free online content. They are not encouraging readers to pay for their news. Scholes stated, “how can it surprise anyone if a business gets into difficulty by giving away its assets?”
Una Murphy is the co-founder and editor of View Digital, a social affairs magazine based in Belfast. View Digital’s website is free to read like the website of Belfast Live but they are a publicly funded magazine rather than a for profit news site. They represent the type of non-profit journalism that Victor Pickard and Merja Myllylahti want to see more of. Their model could be compared to The Guardian, free to read and funded by user contributions and other donations. Una stated that reader contributions is one of their key sources of funding. The editorial team of View Digital do not want their journalistic integrity to be infringed on by advertisers. “We need to generate revenue to pay for our journalism however we focus on sponsorship and grants rather than getting revenue from our readership at present.” A major theme throughout all of the interviews is that the public are willing to pay for quality specialised news content. Una Murphy mentioned The Financial Times in her response, it featured prominently in the academic literature as an example of a successful paywall.
Chapter 5
Conclusion
This dissertation reveals that economic viability of paywalls cannot be judged generally and is dependent on each publication’s set of circumstances. Each paywalled website should be judged on its own merit, a paywall could be successful for one newspaper and a failure for another. The academic literature indicates that paywalls are most viable for newspapers with a global following like The New York Times and The Times. The Guardian have a global following and their paywall would likely succeed, but their editorial stance is opposed to paywalls, their belief is that online news should be free. The public are more willing to pay for news from brands that they recognise and trust to provide quality content. The willingness to pay for online news has increased in recent years but paying for online news remains a niche activity. The literature and the survey data indicate that willingness to pay for online news is low amongst the public.
When consumers do pay for online news it tends to be for specialised content on a particular topic. Two topics consumers are willing to pay for are sporting and financial news. General news is available for free across social media, radio and television, there is a limited incentive to pay for it compared to specialised news. Persuading readers to pay for news is the greatest existential question currently facing the journalism industry. Paying for newspapers became the norm and the next battle is to normalise paying for online news. Opponents of paywalls argue that they have commodified news, turning news into a product rather than a public service. If commodification means paying for news then they are overlooking how the creation of the newspaper commodified news. The debate about paying has just shifted from print to online. Truth rather than profit should be journalism’s highest ideal but without funding, journalists cannot bring truth to the public. The paywall challenges journalists to produce content that readers are willing to pay for. The paywall is not suited to every publication and there is still a place for free online news. It remains to be seen if paywalls will become more commonplace but when quality paywalled content is targeted to a specific audience, it has a strong chance of being economically viable.
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Appendices
Appendix A
Appendix B
McKillenReport 