Buried in a Wall Street Journal story about how “‘paywalls aren’t about to reverse publishers’ deteriorating finances” is the fact that paywall success stories are plentiful. The WSJ had a big head start, of course, and is old news. But 80,000 of its 537,000 digital subscribers read tablet, smartphone or e-reader versions of the paper, a strong indication that these devices are making digital content more appealing. The Financial Times instituted their paywall in 2007, and has already reached 267,000 subscribers. Even the New York Times has built a digital sub file of 380,000 – half the size of its print circulation. The article eventually makes the critical point that “digital readers are inherently more profitable per capita” than print subscribers, because paper and delivery costs are eliminated.
Of course, these are high end papers. But even Gannett forecasts $100 million in additional revenue for their community newpapers in 2013, thanks to their paywall.
Publications chose the free content + advertising route becuase it was easy. They were forced to embrace subscription paywalls by necessity when they could no longer stomach trading “print ad dollars for digital ad dimes.”
Getting paid for content is hard work, and it may take a few years to break-even on subscription acquisition. But it’s well worth it.