Web paywalls are bad news

Free, quality news may soon vanish from the internet - Israel, be afraid

By Alex Brummer, January 28, 2010

Over the past decade or so, clicking onto media websites, from Ha’aretz to the Washington Post, has become a habit for millions of people worldwide.

Search engines such as Google allow anyone to be instantly up with the geopolitical news and gossip. Moreover, in the case of the most recognisable media outlets the reader has the benefit of newsrooms filled with journalists, a solid editing process and access to up-to-date news agency copy on breaking events.

For news junkies, bloggers and the twitterati, it has been manna from heaven. But for the newspapers which have invested heavily in the net, it is a nightmare.

The founders of the internet may treasure the notion of free access. But that clashes with the concept of “intellectual property”. The music and film industries have worked their socks off to make the internet pay and have found ways of recouping royalties. But the written media struggles.

Open access has led to a catastrophic fall off in circulations, savaging of advertising revenues and fears for the survival of the printed media.

The risk is that the free-access sites, without muscular editorial filters, will dominate

Yet in the end, amid the morass of information on the web, separating the wheat from the chaff is often impossible. If you Google, for instance, “Israel Haiti”, what comes up are allegations about IDF harvesting of organs and how field hospital resources would be better deployed in Gaza.

It is only the recognised sites, from the BBC, to the New York Times and the JC, which provide the instant filters needed for the truth. Until now it is specialist publications, like the FT and Wall Street Journal, which have managed to erect “paywalls” around their content. But in 2010 this will change.

In the vanguard are the Murdoch titles. Daniel Finkelstein has been chosen by News International to pilot The Times’s erection of paywalls. He will work alongside Gurtej Sandhu, who is being brought in from Star TV (Murdoch’s Asian channels) to deliver digital. The current estimate is that it will be up and running by May of this year, bringing an end to free access to Times material.

The biggest convert to the paywall cause is the New York Times. It has given itself a year to decide its next move, but the likelihood is that only the first 20 or so visits to its website will be free in the future.

Subscribers to the print edition will have unlimited access. In December 2009, the NYT had some 14.7m unique users of its internet offering, accessing to the paper’s bulging newsroom of 1,700 reporters, commentators and news executives.

It has managed to leverage this into $100m of advertising, but it is thought that to keep it up and running without paywalls would require 20 times that income. This is simply not going to happen very soon despite the forecast by Sir Martin Sorrell of WPP that the digital share of his £8.6bn advertising business will double by 2014.

NYT users divide into those just clicking through and heavier users, who stay on the website for an average of 17 minutes. Users at the upper end of the spectrum, who spend above that time, will be those most likely to pay.

One of the problems for media sites everywhere is free access to the BBC. This in particular is an irritant to other “quality sites” such as the Guardian, which still says it has no intention of constructing paywalls. Editor Alan Rusbridger claimed paycalls could see the industry “sleepwalk into oblivion” by divorcing newspapers from the digital revolution.

If and when the free access model breaks down, it will be the strongest and most reliable brands which triumph and the better off user who will pay. The risk then is that free-access sites, without the muscular editorial filters, could become dominant information sources.

As much as people may complain about the British media and over-sympathetic Palestinian coverage, it does seek a semblance of balance and there are complaint procedures.

Once the paywalls go up in international titles (will the Israeli papers be far behind the New York Times?), the Jewish state will be really exposed to the animal spirits. And it may not be a pleasant experience.

Alex Brummer is City Editor of the Daily Mail

    Last updated: 3:57pm, March 25 2010


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