Wednesday, August 18, 2010


Rupert Murdoch can be happy with The Times of London paywall even as he loses readers

by Larry Geller

Rupert Murdoch’s News Corp erected its paywall in May, and according to a report by MediaWeek, has lost 1.2 million online subscribers.

According to ComScore, the combined number of unique visitors to the two new sites has fallen to 1.61 milion in July, from 2.22 million in June, and 2.79 million in May.

The average number of minutes each user spent on the site was 7.6 in May, 5.8 in June and 4 in July.

The true situation may be worse if the visitor count includes those only stopping by the open home page of the site. In other words, they spend their minutes there, then go on to another news website. If an article gets their interest, they can read about it elsewhere just as well, for free.

Murchock may have good reason, though, to be happy with the result.

For the reading public, of course, the loss of access is real. The loss of links from Google will mean not only that fewer readers have access, but that Times writers will lose exposure. Yet that may not be a problem for the paper’s owners.

Looking at the website as a business, it is conceivable that they may rake in more from the paywall arrangement than they realized before. The bottom line for Murdoch is, well, the bottom line. It’s certainly too early to tell how many paid readers he will get.

It could turn out that the number of paying readers is miniscule in comparison to prior readership, but they are paying, whereas the free readers were not. If the measure of success is financial, then the Times could be successful with a relatively small readership that nevertheless forks over enough to produce a profit.

The same would apply to Honolulu’s Civil Beat, so the Times experiment is well worth watching. Particularly if Civil Beat is a beta test for the use of PayPal as a paywall application. In other words, the measurement of success is financial—will Civil Beat meet its payroll and turn a profit, and what small number of subscribers is necessary for that.

The difference is that the Times website was formerly the extension of a newspaper and so was viewed in the way newspapers are viewed—as a kind of public service, responsible to inform the citizenry. Civil Beat was never Civic Beat, and so we lose nothing if they continue to operate as a gated community providing a kind of controlled conversation on the news or any other subject they choose to write about.

In the future, the large-scale paywalled Times and the exclusive Civic Beat could meet somewhere in the middle, should conversation sites begin to proliferate. Scaling up would require more and better news reporting, or a sideways drift into some other kind of conversation. They’d probably do well shifting to celebrity gossip, for example. Remember, it’s a business model although it has an editor and reporters.

Back at the Times, some readers probably resent being charged for access yet may still come back as subscribers. The front page of the Times is open and could serve to re-addict them to surfing its content. The bulk of those who did not sign up will probably never come back, simply because they can get the same or similar news elsewhere, if it is news they are looking for.

Those who surf for news typically already visit other sites. It’s likely that other sites will continue to experience whatever patterns of readership growth (or loss) they’ve experienced recently.

Some may emulate Murdoch and erect paywalls. Or not. We’ll have to see. The future is probably going to have a mix of free and pay sites.


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