It is over 18 months since The Times set up its paywall, requiring people to pay to read its online news, rather then get it free. At the time there was a huge controversy with many other newspapers crying it would never work. But the owner of The Times, Rupert Murdoch, is a canny businessman. He knows that income and profits are ultimately the only thing that matters to his company; indeed in the final analysis numbers of website visitors is less important than money.[youtube]http://www.youtube.com/watch?v=YHjOokCDx2A[/youtube]
So how is Mr Murdoch doing? Well having shut down The News of the World he has lowered his costs and now has enough set aside it seems to launch The Sun on Sunday this coming weekend. But he is also making real money now thanks to the Times paywall. The experiment which other media critics said would never work, has for the time being, shown it can make serious amounts of money. According to the latest figures The Times online is now reaching almost 120,000 paying subscribers. That’s diddly-squat compared with the 21 million who used to read The Times when it was free. But those freeloading readers did not provide any opportunities for much of an income for the newspaper, other than the display and pay-per-click advertising it had.
Now, though, 120,000 subscribers brings in just under £12.5m a year for Mr Murdoch. It is proof that less is more online.
But here’s the problem for The Times. The fewer people who you reach, the less influence you can have. Now that over 20m previous readers have left The Times and gone elsewhere, no longer are they exposed to the viewpoint of the newspaper. Mr Murdoch may have more cash but that is at the expense of power and authority. And it is not just News International that wants such influence – so do its columnists and journalists. After all, who would you rather work for? An organisation which gets your work in front of 21m people, or one that reaches just 120,000? The danger for The Times is that it will lose quality columnists who seek more fertile ground for their ideas. Which means, in turn, that the people who ultimately end-up writing for The Times may not quite be of the same quality and then, it suggests that people will stop subscribing – especially if they can now get their favourite writers free of charge elsewhere.
What Mr Murdoch has demonstrated is the fact that if you want to make money online you can do so if you concern yourself more about doing business and less about getting traffic (the ultimate goal of most online business it seems). He openly admits that chasing numbers of readers is simply the wrong approach online; instead it is delivering to those who are prepared to pay. But in a global media market, 120,000 is simply not enough. So is it any wonder that rumours have been flying around for a year now which suggest that the paywall may be “relaxed”?
Online you need a balance between focusing on paying customers and having enough clout to warrant attention from potential customers. You can only get that influence if you get enough traffic; shutting yourself away and preventing people from accessing you is reducing your authority. So, yes, you should focus on getting business but you cannot do that unless you also focus on traffic – they are not mutually exclusive notions, in spite of what some experts might tell us.
- Murdoch announces cut-price weekend tabloids, but doubles the Times’ digital subscription price (thenextweb.com)
- To paywall or not to paywall? (umpf.co.uk)
- Sun on Sunday: never has a newspaper been launched in such adversity (guardian.co.uk)