Last week’s announcement by News International, that Times titles will become the first nationals to put content behind a subscription paywall in June this year – sister papers The Sun and News of the World will follow at a later date – marks a hugely significant change for the newspaper model as we know it. The monetising of an online model is something that newspaper proprietors have been wrestling with since they first realised that the internet wasn’t going away.
The problem is this: a digital world makes it virtually impossible to ringfence and monetise content that costs papers money to create. In addition this dilution of free content costs them potential advertising money. To rub it in, search engines such as Google are making plenty via PPC and advertising on their sites when people search for the content.
Rupert Murdoch started going on record a few years ago talking about a limited paywall on selected content. One of his papers, The Wall Street Journal, does it already with some success and he’s in discussions with Microsoft’s Bing to become an exclusive content supplier, blocking Google.
Two things then to consider – will it work and what impact might it have on us in the sponsorship industry.
So first off – will it work?
Given the decline of ad revenues and traditional circulations publishers are looking for something that will.
The real issue is that news is free – for example the BBC, whose charter currently restricts their ability to charge for online content, will always be a free source and skews the market.
However, move beyond news to detailed analysis, unique content, marquee journalists and specialist sectors (fashion, sport, business, culture etc) and people are more likely to pay for it and if they have to pay for the news to get this package they will – as the announcement by News International says -’quality journalism never matters so much as it does today’.
In effect, a Sky TV model for newspapers online – you really want the football but first you have to buy the basics. It’s a clever and bold step by News International but no one knows if it will be the long term solution to the online challenge – even if their competitors follow them.
The power of online content is around the creation and interaction of the very communities it’s aimed at. The new sites will undoubtedly go further then before in giving consumers the chance to interact but does this miss the point that consumers now have the power and desire to create their own communities – they’ve moved from passive to active.
Rather then locking their doors to them, media owners could have a more fruitful future by becoming a platform for these communities and therefore becoming joint creators of content with the very consumers advertisers are willing to pay a lot of money to target.
But what impact might it have on the sponsorship industry?
I see a short term and a long term answer. In the short term, sponsors used to placing unique content their sponsorships afford will find themselves either having to restrict their PR outlets or likely pay to get it placed – never a happy prospect.
But in the long term this change could offer real potential with brands and media owners working together towards a mutual goal. Brands really know how to target consumers while media owners know how to create compelling content.
A savvy sponsor could play this bridging role between the existing consumer communities and a media platform with a paywall. For example, a football sponsor could buy out the paywall themselves around a major event like the opening weekend of the season. The existing audience on the media platform will be absolutely on-target; after all they’ve been paying for this content up to this time.
Give this community, both existing and new, a chance to co-create content with you on a prestigious media platform and as a sponsor you’ll build genuine affinity.
However it pans out over the next year, it’s going to be about playing the game by new rules which makes it both daunting and full of opportunity.
By Dominic Curran on April 1st, 2010
Tags: Default, Media, Paywall, Public relations, Sponsorship, Sport
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Interesting times indeed and wholly polarising as a debate within both our own industry and the newspaper world. Particularly fascinated to watch what the Guardian Media Group and Associated Newspapers do next; lest we forget that the Mail online is currently the most popular UK newspaper website (how else is Joe Public to get the very latest Cheryl Cole latest fix?) with the largest audience in the UK (12.7 million unique browsers) and average UK daily browser figures of 2.27million.
Where Rupert Murdoch goes, will the rest follow? Who knows.
I understand News International’s desire to stop throwing away their journalism for free and as a reader, am more than happy any day of the week to pay for a copy of the Times, The Sunday Times or the Sun. Call me old fashioned, I still like the feel of a newspaper in my hands. But would I pay £1 daily to subscribe to The Times Online when I can go elsewhere for free? I don’t know, time will tell.
Am also undecided as to whether this model is ultimately doomed to fail or whether this is the future. The FT, who already (and successfully) charge for online content, offers a niche product to a niche and wealthy readership who largely require the information in their chosen professions. General news and the wealth of free news services out there is something very different.
Watch this (online) space. For sure, this debate is set to run and run.
I’m not convinced Guardian online will follow – have a read of editor in chief’s Alan Rusbridger’s comments leaked to Guido Fawkes (http://order-order.com/page/2/). They are not a typical publisher due to their charitable status.
While I admire News International’s statement of intent and a willingness to safe guard quality journalism in a commercial model, it’s clear is that no-one has the answer or quite knows what the future holds so expect to see quite a lot of hedging- for example Sky online is not introducing paywalls.