Finally, someone who understands paywalls (and why they work)

Mathew Ingram posted an interesting piece over at GigsOm yesterday. He basically says what I've said before: you need to have unique or exclusive content behind a paaywall in order for it to succeed. He discusses HBO and XM Satellite Radio as 2 examples of unique content:

The latest version of this argument appeared in an op-ed piece in the Wall Street Journal written by TV writer and host Peter Funt, entitled simply “Customers Will Pay For Online Content.” The important point to remember, of course, is that the type of content has a lot to do with whether people will pay.


The problem with both of Funt’s examples — HBO and satellite radio — is that they offered something different, something new enough or unique enough that it made what they were selling qualitatively better or more valuable. Some newspapers (including the New York Times, with Times Select) have tried putting content from columnists or features or special sections behind paywalls, and had little success over the long term. The reality is that most of what newspapers offer is a commodity product, something that has a relatively short shelf life and therefore is difficult to sell as unique or different. Until newspapers solve that problem, their paywall attempts are likely doomed.

One commenter also summed it up pretty nicely:

Headline news has become a commodity, pure and simple. Putting up paywalls won’t have people paying for headline news, it’ll just have them looking elsewhere.But behind all the paywall tricks and traps newspapers may come up with, ultimately they will have to develop some sort of content strategy that will make me want to pay for their content. Headline news is great, OpEds are great… but what else you got?

It's worth noting that GigaOm have a paywall (of sorts).  They have their blogs freely available on the web, but they also have content that you can only access with a $199 a year subscription. I bet you that their content is unique, too.

About Nate Hoffelder (11479 Articles)
Nate Hoffelder is the founder and editor of The Digital Reader: "I've been into reading ebooks since forever, but I only got my first ereader in July 2007. Everything quickly spiraled out of control from there. Before I started this blog in January 2010 I covered ebooks, ebook readers, and digital publishing for about 2 years as a part of MobileRead Forums. It's a great community, and being a member is a joy. But I thought I could make something out of how I covered the news for MobileRead, so I started this blog."

3 Comments on Finally, someone who understands paywalls (and why they work)

  1. Newspapers have yet to realize they need to turn into journalist-activists. People want to know what is going on in their *real* world, not the crap newspapers *think* people want to know.

  2. MIchelle Zaparolli // 3 August, 2010 at 9:00 am // Reply

    FT is a good example of unique content and jouranalist-activism. And the right audience that has the money, desire and need to pay for it.

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