Newsday Readers Don’t Pay, They Go Away

Many of you have by now read the NY Observer story about Newsday, which famously put up a paywall for online content late last year. After a little over three months at it, only 35 people have reportedly decided to pay the $5 per week that Newsday is asking:

That astoundingly low figure was revealed in a newsroom-wide meeting last week by publisher Terry Jimenez when a reporter asked how many people had signed up for the site. Mr. Jimenez didn’t know the number off the top of his head, so he asked a deputy sitting near him. He replied 35.

The article goes on to qualify this shocking number a bit by saying that print Newsday subscribers get online access for “free” and that a subscription to local cable provider Optimum Cable (owned by Newsday’s parent) also provides free online Newsday access. So one might look at the picture a little differently in that larger context.

What we might infer from this example is that online paywalls are better used as a print retention tool or as part of a larger product bundle (if that’s an option). The online only subscriber acquisition is clearly a failure.

(See also: Play Paywall!, the new web game sweeping the newspaper industry.)

This Newsday episode is widely being seen as a cautionary tale or harbinger of doom for the NY Times in its effort to go forward with a tiered pricing model in 2011.

I was speaking about all this this earlier tonight with a friend who was a journalist and is still an editor and writer. He said that unlike the NY Times or WSJ Newsday doesn’t have the same high-quality content. However very few other papers in the US do either.

There’s also much discussion on this “tablet eve” of whether Apple’s new device will make people more inclined to pay for content and thus boost the coffers of traditional media. In some contexts it may, iTunes is a nearly “frictionless” payment system that makes it very easy to buy. But that by itself, and/or a shiny new device, won’t solve traditional media’s problems.

However, it will likely accelerate the necessary movement of traditional media into more earnest efforts toward multi-platform distribution that includes online, mobile and, now, tablets.

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Related: Only 2.4% of print newspaper subscribers are reportedly paying for online news access where paywalls have gone up:

Graphic from Alan D. Mutter

One Response to “Newsday Readers Don’t Pay, They Go Away”

  1. Rocky Says:

    I’d argue that the denominator used for the chart is incorrect. Mutter should use the online uniques in that market, not print circulation if you’re trying to represent the audience that the pay wall is turning away.

    That would make these already grim numbers much grimmer.

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